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Your homeowners insurance covers your jewelry only when it is damaged or lost due to one of 16 specific perils. The protection afforded to your jewelry by your home insurance is subject to a number of limitations and stipulations. This article will explain when and how your jewelry is covered and let you know what options are available to you to ensure your valuables are sufficiently protected.
When Does Homeowners Insurance Cover Lost or Damaged Jewelry?
When jewelry is lost or damaged because of a 'listed peril', such as theft or fire, it is covered by your homeowners insurance. If, for example, your home is burglarized while you’re away on vacation and thieves manage to steal a necklace that has been in your family for generations, your policy will cover part of its value--up to a maximum limit defined by your specific policy. If a fire in your home causes damage to your jewelry collection, the damage will be covered by your insurance, but, again, only up to your coverage limits. All the listed perils are stated below:
- Lightning or fire
- Damage caused by vehicles
- Falling objects
- Water damage from plumbing, heating, or air conditioning overflow
- Pipe freezing
- Hail or windstorm
- Riots or civil disturbances
- Volcanic eruption
- Water heater cracking, tearing, and burning
- Damage caused by aircraft
- Smoke damage
- Damage from the weight of snow, ice, or sleet
- Damage from electrical current
Your jewelry is not covered by homeowners insurance when loss or damage is a result of something not listed above. For instance, if your ring slips off your finger and falls down the drain while you’re cleaning, it won’t be covered by your insurance policy because the loss isn’t the result of something explicitly listed in your policy. Likewise, misplacing a piece of jewelry or damaging it somehow - even by accident - won’t be covered by your homeowners insurance. As well, if jewelry is lost or damaged in a flood, you will need a separate flood insurance policy since your homeowners policy will not cover any damage associated with a natural flood.
How Much Does Your Homeowners Policy Cover You For?
While your homeowners insurance might provide you with, for example, $200,000 of coverage, your jewelry isn’t covered by the same amount. Most home insurance policies provide personal property coverage of 50% to 70% of the total insurance coverage. Jewelry, though, is considered high-value property that can be easily lost or stolen, so coverage for it is to a certain amount - usually between $1,000 to $2,000.
If you, for example, own a $15,000 diamond engagement ring, your home insurance would only provide coverage up for the first $1,000 to $2,000 of value. In most cases that coverage doesn’t offer very much protection for more than one or two pieces of jewelry, especially if some pieces of jewelry are particularly valuable or you have a large collection.
How Do You Increase Coverage for Your Jewelry?
If your jewelry is worth more than what's set forth in your policy, you can purchase an additional endorsement or floater. Also known as scheduled personal property coverage, it is a good way to raise the coverage limits of specific high-value items, such as valuable family heirlooms, that you own. Premiums for floaters are dependent on the types of items you’ve scheduled, how much the items are worth, and the area in which you reside. Unlike with personal property coverage provided by your homeowners insurance however, there’s no associated deductible for items covered by a floater.
An added benefit of a floater is the additional protection some offer you. Some floaters cover you for situations in which you lose a ring or leave it behind on vacation. Personal property coverage under your home insurance policy would not cover you in that case since it's not a listed peril. When scheduling the items you wish to raise coverage limits for, your insurer will likely require you to have the items appraised, unless they were recently purchased and you have receipts available. Having the items appraised means the floater will insure the item or collection for its full value, instead of only being insured to a coverage cap.
Should You Get a Jewelry Protection Insurance Policy?
Jewelry protection insurance is a separate insurance policy meant especially for insuring jewelry. Like scheduling your jewelry with a floater, jewelry protection insurance covers your jewelry beyond the common perils. Unlike a floater, though, claims made against a jewelry protection insurance policy aren’t counted as a claim against your homeowners insurance. A quick comparison between a standard homeowners insurance policy, a floater and jewelry protection insurance can be seen in the table below:
|Type of Coverage||Covered Events||Coverage Limit||Deductible||Premium|
|Homeowners Insurance||Listed perils||Capped, usually between $1,000 and $2,000||Homeowners insurance deductible||No additional premium|
|Floater||Listed perils, plus accidents, maybe other risks||Appraised value||No deductible||Premium based on value, items covered, and area of residence|
|Jewelry Protection Insurance||All events, accidents, and unintentional damage||Appraised value||May have a deductible||Premium based on value, items covered, and area of residence|
Jewelry protection insurance is a very viable option, particularly when you want to insure high-value or at-risk jewelry such as a multi-carat diamond ring. As an added bonus, where claims made against home insurance or an additional floater impact your premium and future insurability, jewelry protection insurance is its own separate policy and insulates your home insurance from any claims. The premiums for most jewelry insurance policies are between 1% to 2% of the total insured value, meaning $10,000 of coverage might cost only $100 a year.
How to File a Claim for Lost or Damaged Jewelry
If your jewelry is stolen, you should first contact the police to report the theft. Be sure to provide as much information as possible about the stolen jewelry and request a copy of the police report in the event your insurer asks for it. If there is a situation where your jewelry is damaged from a source covered by whichever type of policy you own, take pictures of the damaged pieces and the source of the damage.
The next step is to contact your homeowners insurance company. If you have separate jewelry protection insurance, you’ll need to contact the insurer of the jewelry insurance policy and not your home insurance company. When you contact your insurer, you will have to give details as to what happened to your jewelry. Depending on the type of coverage you have, you may have to pay a deductible before beginning the replacement or repair process.
Your insurer may require you to use a jeweler or repair and replacement company of their choice. With a jewelry protection insurance policy, your insurer would permit you to have repair or replacement work done at a jeweler of your choice and would provide you with the same kind and quality of jewelry as the missing or damaged piece. The covered amount of your jewelry with jewelry protection insurance is the appraised value of the piece after you pay your deductible, if your policy has one.