Jewelry Insurance covers theft of jewelry, accidental loss, burglary, or damage to jewelry kept in some fixed bank lockers. Some insurance policies offer protection to jewelry worn in person as well. Typically, there is a sub-limit on the jewelry to be insured. However, some policies provide a separate all-risk cover for valuables and jewelry where you can choose a suitable sum assured.
Jewelry Insurance is another way to protect your jewelry after bank lockers. A type of property insurance policy that specifically covers fine jewelry, like rings, necklaces, watches, earrings, and sometimes even loose gemstones. If your insured jewelry gets lost, stolen, or damaged, the insurance company pays to repair or replace the item.
How Does Jewelry Insurance Work?
A homeowners Jewelry insurance policy will pay for a jewelry repair or replacement after a problem covered by the policy, such as a fire. But a standard homeowner’s insurance policy limits coverage to $1,500 for theft of jewelry, watches, furs, precious and semiprecious stones.
You can buy separate jewelry insurance if you have items whose value exceeds your homeowner’s insurance limit.
What’s right for you depends on the value of the jewelry you want to protect.
Benefits of Jewelry Insurance:
Having a lot of jewelry locked up at home is not a safe option anymore. It is very important to shield the jewelry you own as it has many benefits:
– Jewelry comes to the rescue when you are faced with a misfortune and are in sudden dire need of funds.
– Having insurance on the jewelry saves you from the trouble of opening a locker with the bank.
– Bank lockers are not fully safe and there is always a certain amount of risk associated with it.
What Does Jewelry Insurance Cover?
A separate jewelry insurance policy typically covers damage, loss, or theft. Damaged jewelry will only be covered if the damage is caused by a problem covered by the policy, like a fire.
You can insure many types of jewelry, including:
Engagement rings
Wedding rings
Earrings
Watches
Antique jewelry
What Does Jewelry Insurance Not Cover?
Jewelry insurance doesn’t cover every type of loss. A jewelry insurance policy generally doesn’t cover:
Pre-existing damage to jewelry
Wear and tear
Intentional damage
Pest damage
Types of Jewelry Insurance
1. Basic Homeowners Insurance for Jewelry
A standard homeowner’s 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 semi-precious stones.
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, 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 homeowner’s coverage with what’s known as a “personal articles floater,” which costs more than simply raising the coverage limits on your homeowner’s policy.
A floater can cover jewelry that exceeds the coverage limits of your homeowner’s 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 Jewelry Insurance Policy
A stand-alone jewelry insurance policy can be purchased from a company that specializes in insuring jewelry. 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.
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
No deductible
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 the Insurance Information Institute.
Process of Applying for Jewellery Insurance:
The following factors play an important role in applying for jewelry insurance:
- Valuation – While applying for jewelry insurance, you are required to present a list of items that will be covered along with their valuation. Valuation certificates of the jewelry can be attained from a reputed jeweler as they may be required for items of high value.
- Cost Factor – Premium towards jewelry insurance depends on the total sum assured. However, you can always try to avail discounts from the insurance company.
- Filing a Claim – In case of loss of the insured jewelry, you must file a claim with the insurance company. The claim form needs to be filed along with the details of the loss and valuation of the jewelry. You are also required to provide a report from the fire department in case of fire and an FIR in case of theft of jewelry. It is also advisable to keep a copy of the insurance policy.
- All-risk Cover – The insurance should be an ‘all-risk cover’ that protects against fire, burglary, and other perils. Some covers are 100% insured, while some are on a ‘first-loss limits’ basis, which implies a portion of the jewelry’s value is insured. The insurance company determines the maximum probable value that can be lost in a single incident. This value is termed as the first loss sum insured.
Factors That Affect Jewelry Insurance Cost:
The cost of jewelry insurance depends on several factors. Comparing quotes from a few different insurers can help you find the best jewelry insurance.
Appraised value: Items with a higher value are more expensive to insure.
Deductible: If you have a choice of deductibles, choosing a higher deductible will result in a lower premium.
Security: If you store the jewelry in a home safe or safe deposit box, or if you have a home security system installed, you might pay less for jewelry insurance.
Your location: Where you live affects rates. For example, our analysis found that it is usually more expensive to insure a piece of jewelry in Palm Beach, Florida, than in Dallas or San Mateo, California.
How to Get an Appraisal for Jewelry Insurance:
Look for a professional appraiser in your area. Most jewelry stores can appraise pieces. You can also search for a reputable appraiser through organizations like the American Gem Society and the National Association of Jewelry Appraisers.
Once you find an appraiser, bring your jewelry and any documentation you have for the item, like the original sales receipt or certifications from the Gemological Institute of America. The appraiser will evaluate your jewelry using specialized equipment. They’ll look for things like the condition and quality of the item, the quality and characteristics of the gemstones, and the quality of the setting.
You’ll receive a copy of the report, which will include the current estimated replacement value. This is the amount of coverage you should purchase. Getting your items reappraised every few years is smart, as the value of your jewelry can change.
Source: www.forbes.com