Jewelry Pitfalls in Homeowners Insurance and How To Fix Them

Christmas and Valentine’s Day are, traditionally, big gift holidays, and they’re pretty much back to back. In the midst of all the holiday craziness, it’s pretty darn easy to forget to tell us, your favorite insurance agency, about those items. So, say you forget. Now it’s March and the new necklace is stolen- what do you do? Will your home insurance pay?

What (might be) included

Your basic, standard homeowners insurance policy (or even renter’s insurance) usually includes coverage for jewelry, furs, art, etc. However, basic insurance policies limit the amount of coverage- possibly as low as $1,000 for any claim, with a limit of $250 per item. This means if any one item in question is more than $250, or if the total amount lost or stolen is over $1,000, you’re out of luck.

If you’re lucky, you *might* have a homeowners insurance policy that automatically grants you $10,000 for jewelry. Your partner loves buying you sparkly things, and your wedding ring/engagement ring set is a whopper! Plus there’s Grandma’s earrings, Aunt Mildred’s pearls, Uncle Joe’s Rolex, and all those Valentine’s gifts. It adds up quick!

”Engagement rings and other expensive jewelry are perennially favorites for gifts, but with the soaring popularity of electronics of all types some people may feel that nothing says ‘I love you’ like a flat screen TV or an expensive leather handbag,” said Jeanne M. Salvatore, senior vice president and consumer spokesperson for the Insurance Information Institute (I.I.I.). Where does coverage for your Apple Watch fall? Or that fancy Louis Vuitton? Guns are all over the news now, but is the antique firearm insured?

More than just theft

So with your basic, standard homeowners insurance policy limit of $1,000, you most likely have coverage for fires and theft. Here’s one for you- what happens if you’re out skiing and you just lose your diamond stud earring in the snow? You throw a party and afterwards you can’t find your watch. Or you’re out at a restaurant and the center stone pops out of that antique ring you have?

True story- my parents and I went shopping and then ate lunch at TGI Fridays. Mom’s ear looked… weird. I did a double take and the diamond was no longer in its setting in her ear. The stone had literally just vanished. We searched the booth, the floor – EWW! – but and knew it was pretty much hopeless. Well, if you’ve done it right and have a solid jewelry policy that you paid extra for, it will include “mysterious disappearance.”

“While there is no way to insure the sentimental value of jewelry or other expensive items, having it properly covered will provide financial protection in the event it is lost or stolen,” pointed out Salvatore.

We suggest the following
  • Contact your insurance professional immediately (today is fine!)
    Let us know that you are now in possession of an expensive piece of jewelry or other costly items- even if it’s a gift and you haven’t given it yet- and you want to add it to your homeowners insurance policy.
  • Have the item appraised
    Reappraise heirlooms and items that you purchased years ago. If you have not had your high-valued jewelry appraised within the last few years, consider obtaining an appraisal from a reputable jeweler.
  • Keep a copy of the store receipt
    You should forward a copy of the receipt to us so that the insurance company knows the current retail value of the item. Keep a copy for yourself and include it with your home inventory.
  • Store valuables in a secure location
    Protect your jewelry by storing it in a secure location in your home. If you do not plan to wear the item regularly or are holding it for a child, consider keeping it in a safe deposit box. You may save money on the cost of insuring it as some companies offer “in vault” coverage. If you want to wear the jewelry for a special occasion, many home insurance will offer the option of purchasing additional coverage for the time it is out of the bank; you do, of course, have to notify your insurer ahead of time if you plan to do this.
  • Update the value of your valuables
    Expensive items can go up or go down in value based on the cost of gold or other precious metals. Talk to your insurance professional about how to make sure your insurance reflects these changes.
  • Take a picture of the item or collection
    Get into the habit of keeping a visual record of all of your personal possessions. This helps to document your loss and can speed up the claims process. It is also useful when documenting antique and unusual pieces of jewelry.
  • Add the item to your home inventory
    Everyone should have an up-to-date inventory of their personal possessions, including valuables. This can help you purchase the correct amount of insurance and will make the claims process easier if there is a loss.

Moral of the story: If you receive an expensive gift or any other valuable items, you should contact your insurance professional immediately.

Sources: Insurance Journal, Insurance Information Institute, Insurance Risk Management Institute

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