Jewelry Insurance by Touchstone

Jewelry Insurance Is It Worth The Cost?

Insuring your jewelry with a policy of its own is very much worthwhile considering that the coverage is quite broad and the premiums low. Even though homeowners insurance is supposed to have a jewelry insurance component built in, it is often found that covered jewelry is valued very low. When a claim does need to be made, a separate insurance policy yields better coverage.

Why insuring your jewelry with a separate policy is beneficial

A separate jewelry insurance policy will list out each of the items and describe them minutely, mentioning the value of each individual piece. If you happen to lose any item or end up with damage due to repair, insuring your jewelry will enable you to have it replaced or repaired with the help of the descriptive list.

The Procedure Involved For Insuring Your Jewelry

Usually state laws govern the insurance industry and even mandate the type of language to be used in the contracts. In some states there is more flexibility where insurance companies can word their own policies. It is always better get in touch with an agent in your area to know the right procedure.

Depending on the jewelry insurance company, there will be a minimum annual premium applicable. It is usually advisable to have your jewelry evaluated by a professional to avoid errors in judgment both at the time of going in for a new policy as well as a renewal. You will need to find out from your insurance agent what the procedure for a claim is. In case you lose your jewelry, you would want to know whether the appraised value is paid to you or whether there will be deductions. It is better to make a note of whom you can approach for your claim. While insuring your jewelry, clarify special clauses and find out what happens if you lose one item from a set of two and whether the insurance policy will cover the entire set, if specified in the policy.

As far as premiums are concerned this can vary depending on where you live.
Most companies will charge based on the value of the jewelry, in the sense that the more expensive, the higher the premium. It is possible to negotiate the best deal by going in for insuring your jewelry with the same insurance company where your home or car is insured.

How claims are settled

There is one thing you ought to know about insurance companies. The money paid to the claimant will always be the amount it would cost them to replace the item, and not the insured value. If a specific piece of jewelry was appraised at a particular amount, the compensation will only be the cost of the replacement, which could be less than the insured value. If your jewelry is damaged, the insurance company will offer to repair it. If you lose it, they will make a replacement with a similar quality item. The options for settlement will also differ from company to company depending on what is specified in the policy.

Do not just take it for granted that you will simply be paid the appraised value should you make a claim. The appraised value is only the maximum amount that the insurance company is liable for, and not necessarily what you will receive. Depreciation also comes into the picture over time and the actual cash value that the insurance companies talk about will reflect the cost of replacement after the depreciation is deducted. The actual cash value depends on the prevailing rates of gold, silver and diamonds and your claim settlement could be very different from what you foretell.

Remember to retain all your original bills and photos of your jewelry at the time of insuring your jewelry, along with the appraisal made by your jeweler since this will be required to calculate your premium.