Maybe your grandma slips an heirloom ruby necklace valued at $10,000 into your holiday stocking. Or perhaps you’ll ring in the New Year with a $5,000 engagement ring on your finger.
While you think these pieces are safe if they’re stashed in a jewelry box, what happens if you lose the necklace in a house fire or the ring is stolen from your bedroom? Will your homeowners insurance cover these pieces?
A standard homeowners insurance policy typically falls short of fully covering high-value jewelry. But you can add the right coverage if you know what to look for.
Let’s look at the three main methods for locking in jewelry insurance.
1. Basic Homeowners Insurance for Jewelry
A standard homeowners insurance policy covers jewelry, including losses caused by fire, a tornado, theft or vandalism. But the policy normally imposes a $1,500 limit for the theft of jewelry and watches, as well as precious and semiprecious stones. Why is the theft limit so low? Because jewelry is so easy to steal, according to the Insurance Information Institute, a trade group.
You can raise the home insurance coverage limits for jewelry, but even those dollar amounts might be insufficient. For instance, you might pay extra to bump up the limits to $2,500 per piece and $5,000 overall—which may still not be enough.
Too many homeowners discover when it’s too late that their standard home insurance won’t fully cover the loss of a $25,000 ring, says Bryan Howard, director of product management and personal lines underwriting at Jewelers Mutual, an insurer that covers jewelry. “That’s a difficult pill to swallow,” he says.
If you make a home insurance claim for theft or damage, such as fire damage, your insurance check will be reduced by the amount of your deductible.
2. Insurance Floater for Jewelry
You can get better jewelry insurance by supplementing your homeowners coverage with what’s known as a “personal articles floater,” which costs more than simply raising the coverage limits on your homeowners policy.
A floater can cover jewelry that exceeds the coverage limits of your homeowners policy. A floater itemizes each piece (such as that ruby necklace or engagement ring) and lists types of losses that might be excluded, such as jewelry destroyed in a flood.
A deductible typically isn’t applied to a floater.
A floater provides jewelry insurance that’s broader than a standard homeowners policy. For instance, a floater covers an “accidental loss”—like dropping your engagement ring down the bathroom sink or leaving a necklace in a hotel room. When you buy a floater, you’re required to get each itemized piece professionally appraised.
Floaters usually cover items no matter where they are, such as in your home, on a plane heading to France or in a hotel room in the Caribbean.
3. Stand-alone Policy for Jewelry
A stand-alone jewelry insurance policy can be purchased from a company that specializes in insuring jewelry.
Many stand-alone policies and floaters offer similar components, according to the Insurance Information Institute, although this varies from insurer to insurer. The similarities may include:
- Coverage for a variety of problems, such as theft, accidental loss and mysterious disappearance
- Coverage of the loss of part of a set, such as one diamond earring
- Coverage for jewelry that you take with you on international trips
- No deductible
However, a specialized jewelry policy may go beyond a floater by covering incidents that a traditional insurance policy might not cover, such as a chipped stone in a ring or a broken clasp on a necklace, according to Loretta Worters, a spokesperson for the Insurance Information Institute.
In many cases, annual coverage from a speciality insurer costs 1% to 2% of the jewelry’s value. Jewelers Mutual says this means a $5,000 engagement ring could be covered for $50 a year. The company says its deductible options include zero, $100, $250 and $500.
For extremely valuable jewelry, Jewelers Mutual might offer deductibles of $25,000, $50,000 or even $100,000. An appraisal determines the jewelry insurance limits under a Jewelers Mutual policy.
One advantage to a separate jewelry insurance policy is that claims stay off your home insurance record and therefore won’t affect your future home insurance rates. Jewelers Mutual also lets you choose the jeweler that repairs or replaces your lost or damaged item. (Other insurers may work with jewelry services to settle a claim, meaning a policyholder might not be able to rely on their own jeweler to repair or replace an item, says Don Elliott, director of claims at Jewelers Mutual.)
“We have had a lot of success stories where we were able to save the day because the fiance lost the [engagement] ring he had coverage with Jewelers Mutual and we were able to quickly work with his jeweler to get an identical replacement,” Elliott says.
PURE Insurance—which specializes in coverage for high net-worth individuals—insures jewelry through its homeowners policies. It either insures a collection of jewelry whose values have been itemized or supplies blanket coverage for a broad collection of lower-value jewelry items. In several ways, its coverage is similar to Jewelers Mutual’s coverage.
The jewelry insurance limits under PURE’s homeowners policy exceed those for typical homeowners coverage: a $25,000 limit for a single piece of jewelry that is stolen, lost or misplaced, and an overall limit of $50,000. A PURE customer can buy “scheduled” coverage for higher-value jewelry as an add-on to their regular PURE homeowners coverage. With this extra coverage, items must be professionally appraised.
To get the right jewelry insurance, PURE executive Claire Marmion recommends doing regular inventories and appraisals of your collection.
“People tend to underestimate how much jewelry they have. They live with it every day, they love it, they take it around, and they just sort of forget what they have,” Marmion says.
Summary: Jewelry Insurance Options
Tips for Protecting Your Jewelry
GEICO, one of Jewelers Mutual’s partners, gives these tips for protecting jewelry:
- Keep copies of purchase receipts.
- Take pictures of your jewelry.
- Store valuable jewelry in a secure place, such as a safe deposit box. Howard at Jewelers Mutual suggests stashing high-value jewelry in a heavy at-home safe that’s bolted to the floor and out of sight.
- PURE’s Marmion says it can also be a good idea to keep jewelry in different places in your home to make it harder for thieves to find and steal all of your pieces.
- When you’re traveling, bring only those pieces of jewelry that you plan to wear. Going a step further, Elliott recommends traveling only with costume jewelry that looks like pricier pieces, rather than with high-value items.
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