The season of giving is here! Chances are good that some fine jewelry or a nice watch or perhaps an engagement ring will be given to you or someone you know. It's crazy how much jewelry is bought this time of year. In my younger days, I used to sell jewelry in a mall in Tucson. I know how much jewelry is purchased this time of year. Literally, a year's worth of sales in a matter of weeks.
But I have a warning for you: If you don't properly schedule these items of jewelry or watches with your home insurance or renters insurance you won't be properly covered and it could be a very cold winter, especially for the men out there.
You might be asking, Why should I schedule jewelry on my policy, doesn't my policy already cover jewelry? This is a very common question that we get in the agency. The answer to that question is that you have Limited coverage. And by Limited, I mean Limited. To find the definitive answer for your coverage situation, you must look to your home insurance or renters insurance policy specifically. All policies are not the same! Generally, your policy will have a section for Special Limits for Certain Types of Personal Property. Jewelry and watches will be listed here. You'll have limited coverage for theft only and in an amount from $500-$2,500 in most policies. Plus you would have a deductible to pay as well.
Most policies do not cover Mysterious Disappearance and Loss so if the item is lost, misplaced, or otherwise disappears (something other than theft) then you would have NO COVERAGE at all!
Back to that pesky deductible. Let's say you buy a diamond bracelet for $2,500 and let's say your policy coverage is $1,000 for theft of jewelry and let's assume your deductible is $1,000(many policies have this deductible). If that bracelet is stolen you would have no coverage ($1,000 limitation minus $1,000 deductible equals Zero payout). If the bracelet gets lost or disappears then don't even call your insurance company to file a claim because you have NO COVERAGE in that scenario with most policies. Some of my carriers include a small amount of coverage for Mysterious Disappearance and Loss but again you would be subject to the deductible and the same outcome would apply as if it were stolen.
How do you best handle this problem so you can stay in good graces with your partner in life or significant other? The solution is to Schedule these items specifically onto your Homeowners Insurance or Renters Insurance policy. To schedule an item, you are specifically identifying this item to the insurance company via an appraisal or bill of sale that describes the characteristics of the item in detail and then you pay an extra premium for this. Typically this should cost less than $1 per $100 of value. The cool thing is, not only is the item now covered for it's appraised value you've also broadened the coverage to include Mysterious Disappearance and Loss AND you typically have a ZERO deductible for the item as well. Trust me, you will want to have this coverage if something were to ever happen to wife's wedding ring.
Stay warm this winter with your honey by properly insuring that fine piece of jewelry or watch that you purchase for your "Better Half". Now, get shopping!
If you have a story about whether or not you were covered for a jewelry loss please share that with me in the comments section. I'd love to hear it.
Author Richard Morris
Richard Morris, an independent insurance agent in Gilbert, Arizona and Chandler, Arizona, has been serving and helping Arizona families and businesses with all their insurance needs for over 25 years. Visit his website at http://www.southwestpremierinsuranceagency.com to see all the ways he can help you with your insurance needs or call the office at (480) 336-2707 or toll-free at (888) 907-9349. Connect with Rich on Google+ and Twitter.