Insuring Your Jewelry
by Brian Boak and David J. Singer
A very common question that insurance brokers hear is, “Why do I have to cover my jewelry any differently than my other possessions?” In this short piece, we will give you the answer to that question, and what you should think about when deciding about jewelry coverage.
The reason that jewelry is treated differently than other possessions is that it is a target of thieves. Therefore, the insurance companies need to charge more to cover your jewelry. In order to do that, every home, condo, co-op, and tenants’ policy has limits on jewelry coverage and if you have more jewelry than the policy’s limit, you need to buy more coverage. The limit may be as low as $500, but could be as high as $5,000. The jewelry coverage may also be subject to the policy’s deductible, meaning that the policy would only pay for claims in excess of the amount of the deductible. Even if you do not have more coverage than the policy’s limit, you may wish to “schedule” your jewelry, as discussed below.
Jewelry coverage can cost between $15 and $25 per $1,000 in coverage (depending on location). There are two ways coverage can be added to your policy, Blanket or Scheduled:
BLANKET COVERAGE: You tell the insurance company how much coverage you want in total. You would not need to list individual items (good). Some companies have an endorsement to add $1,000, $2,500 or $5,000 of jewelry coverage to your policy. Other companies allow higher limits. A deductible may apply to a loss and there is normally a per piece coverage maximum.
SCHEDULED COVERAGE: You would provide the insurance company an appraisal (or a bill of sale in some cases) for each item you want insured. Those items would be listed on your policy, and in the event of the claim, the value would be predetermined. In addition, a deductible is usually not applied to a loss (better for you).
Insuring a piece or not is completely up to you. We recommend Scheduled for expensive items and Blanket for lower value items. The decision should be based on whether or not you are comfortable without the coverage. If you are not, the peace of mind that insurance will give you is very much worthwhile.
A couple of final suggestions:
- Have your items appraised every 5-7 years to be sure the value is current.
- Determine if your insurance company will pay cash for the loss (without replacing the item) and if they will let you use your own jeweler (or if you have to use their jeweler to replace the item.) If you are not happy with your insurance company’s answers, look for an insurance company that provides coverage the way you would prefer.
Brian and David are with the insurance broker Singer Nelson Charlmers www.singernelson.com. David is also the author of the recently published Six Simple Rules for a Better Life www.sixsimplerules.com.
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