There is alot to talk about when the subject of jewelry insurance comes up and is one of the most common questions we get at Warren Jewelers. Should the unforeseeable occur and you suffer a loss, we work closely with your insurance company to help you with replacement or compensation of your valuable jewelry or family heirloom.
Reasons to insure your jewelry
Jewelry is one of the top three largest personal property purchases in your life. You do have insurance on your home and car but those do not have the great sentimental value your jewelry has. It does not matter if it is your wedding ring, diamond earrings you received from your mother or grandmother. Part of taking care of these items is insuring them. Make sure your insurance will cover loss from theft, accidental loss and damage.
Reasons to buy a stand-alone policy
Private jewelry insurance gives you choices that a standard homeowners or renters policy may not. Price is one of the main considerations for private jewelry insurance because it offers to replace your item with like kind and quality and not a cash amount that lowers your cost to insure the item. With a private jewelry insurance policy you do not risk the premiums on your homeowners or renters policy in the case of loss. You can also choose a deductible from $0 to $500.00. The larger the deductible the better the discount.
Things you need to know about Jewelry Insurance:
State laws differ but are regulated by the Insurance Commissioner and insurance departments of the individual states. Some states tightly regulate insurance company contract language and other states allow insurance companies to write contracts with their own language. You should discuss your insurance needs with your insurance agent. If you do suffer a loss you do have the right to choose the jeweler who you trust to replace the item. Your insurance company may make suggestions but it is up to you to tell your insurance companying whom you would like to use to replace the item.
Most jewelry is covered under your homeowners or renters insurance policy. You can also buy private jewelry insurance so a loss will not affect your homeowner rates.
Unscheduled personal property includes jewelry which would be covered by your homeowners or renters insurance. However, in most policies not all losses are covered. In addition there are low dollar limits on unscheduled personal property. In a case of a large theft you may only be covered for a total loss as low as $500.00 compensation. For any item of jewelry with a value over $1000.00 you should schedule your jewelry to cover specific items. This is done with a Personal Articles Floater, which is attached to a homeowner or renters policy. You can also purchase a stand-alone or private jewelry insurance policy. The coverage on these types of insurance can be very broad covering all types of losses with very few exclusions.
Premiums or Cost to Insure
Prices to insure items can vary from state to state. They can also vary from different insurance companies serving the same area. Most rates are quoted per $100.00 of insurance coverage. Some companies have a standard rate; others have graduated rates, which may change depending on the value of your item. You can save from paying excessive premiums by raising your deductible or opt for a private jewelry insurance policy. You should do some comparison-shopping. Even an alarm system or safe in your home may add up to discounts on your insurance.
Loss Settlement Options
The most common types of settlements are:
- Replace it with a like kind and quality
- Pay you the actual cash value, known as A.C.V.
- Repair the jewelry
- Pay you an amount equal to the cash equivalent
- Pay you for the item’s scheduled amount
These are not the only options but are the most common types. Most people assume the scheduled value or amount is based on just the appraisal. People assume that the appraised value is what they will receive if there is a loss. That is not the case. A cash-out type payment is bases on an item’s actual cash value (A.C.V.). This means replacement cost at the time of loss. This can be determined less depreciation or value of gold, diamond, gems, etc. at the time of loss. You should understand that there is no way to predict what you will receive if a loss occurs in the future. That is one of the reasons you may want to request the insurance company replaces the item with a new item of like kind and quality. A new item will have no wear and tear and can be replaced at current value. The A.C.V. can be much lower and you may not be able to replace the same item with a cash payment.
Paperwork you need
You need to supply your insurance company with copies of paperwork such as sales receipts, current appraisals and certificates on gemstones from independent laboratories such as GIA Gemological Institute of America, E.G.L. European Gemological Laboratory or one of the many other independent laboratories. If your appraisal does not include an independent laboratory certificate you should take your item to an independent laboratory to have your item appraised to be sure that qualities are consistent and that the jewelry is what you think it is. Appraisals need to be kept up to date even if you have had your jewelry appraised in the past and you already have a policy on it. If it has been two or more years since you have updated your appraisal you could have problems if you have a loss so, keep your paperwork up to date. Appraisals should be done by a Graduate Gemologist, G.G. and should include a photo for your records. Documentation is the best way to protect yourself. All the staff at Warren Jewelers is knowledgeable about what jewelry should be appraised and insured and can help you navigate this so you do not over insure.
A lot of jewelers offer all types of extended warranties. Some are free, no extra charge, and others charge for an extended warranty. You should think it over before you pay money for a warranty. This is adding to the price you paid for that item and evaluate what you are getting for that extra money. Warranties do not take the place of insurance. Even if you have the best comprehensive warranty, it is not insurance. If a warranty is offered make sure to follow the terms of that warranty, such as having your jewelry cleaned and checked at regular intervals. This should be basic care and maintenance. The only way to protect your jewelry is to have an insurance rider on it from the day you purchase it.