Summer is quickly approaching and many people will be heading off to have fun…or to see their relatives. Whether you’re having fun or visiting family (hopefully that’s fun too), chances are you’ll be bringing some jewelry along. Jewelry is often one of the most overlooked insurance issues. Many people don’t have the right coverage and don’t realize the limitations of their homeowners policy.
Let’s start with the bad news about jewelry coverage and your homeowners policy:
- A standard homeowners policy will not cover jewelry for disappearance, so if your luggage is lost or your ring disappears, there is no coverage. · A standard homeowners policy will only cover theft of jewelry for $1000. This means that regardless of how many pieces and how valuable those pieces are, $1000 is the maximum amount your policy will pay.
Here’s the good news (not great news) about jewelry coverage and your homeowners policy:
- A standard homeowners policy has no limitation to where you can travel (anywhere in the world is ok), the method of travel (boat, plane, etc. is fine) and how your jewelry is stored (in luggage, on your person, etc. doesn’t matter). · A standard homeowners policy does cover jewelry for fire, wind, explosion, and some other perils. So if your hotel room catches fire, your jewelry can be covered up to the full limit of the policy.
Since the most common claims for jewelry are for theft or disappearance, the homeowners policy is a poor way to insure jewelry. So what are the options to get the right coverage? You can schedule your items onto your homeowners policy as an extra endorsement or you can purchase a separate policy specifically for items like jewelry. By doing either of these, you will be covered for theft, disappearance and other possible claims such as:
- Stones disappearing from settings b. Weight of people or animals (like someone stepping on an item) c. Non-malicious acts of children (think of kids flushing that necklace down the toilet) d. Spillage (think of paint or chemical spills) e. Animals (think of a dog chewing or eating items) f. Dropping items (think of dropping an item and chipping or cracking a stone) g. Damage from fighting (let’s not think about this one) h. Dropping a ring down the disposal (this is more common than you might think)
When you schedule items onto your homeowners policy or purchase a separate scheduled policy, those items are covered for a specific value (usually the appraised value of each item). The items are covered for almost any peril and the amount of your claim is basically guaranteed because the item was covered for a specific value to begin with. You won’t have to argue with an adjuster to convince him or her of the value of the item.
When you purchase an extra endorsement or a separate policy to cover jewelry, make sure you check with your agent about any specific requirements for your items. Generally, you can travel anywhere you want in any way that you want, although occasionally a policy may require that certain items be kept in a safe when not worn. Also, some policies could have limitations about the amount of jewelry that can be taken when traveling. However, both of these requirements would probably only apply to very high-end jewelry (items valued over $100,000) that most people wouldn’t travel with anyway.
If you have the right coverage, you can rest easy whether you travel with your jewelry or leave it at home. Obviously, it’s probably not a good idea to take all of your jewelry on a trip since there are more opportunities for it to get lost or stolen. On the other hand, if your jewelry is sitting at home while you’re gone, it can be stolen too. Your jewelry is probably a little safer at home, so minimizing the amount you take on a trip may be smart. But the whole purpose of insurance is for peace of mind, so make sure you are covered with a good policy and then relax regardless of what you take or leave at home.
Another thing to remember is that some jewelry may have more sentimental value than cash value. There is no way to insure sentimental value. That the ring your grandmother gave you can only be insured for an appraised value. Since jewelry may be more susceptible to loss on a trip, make sure you really want to travel with that piece and make sure that you take precautions to keep it safe.
For the jewelry you do take, make sure to use proper precautions to secure the jewelry and keep it as safe as possible. In most cases, it’s probably better to wear it than to keep it off of your person. Hotel rooms and luggage racks are notorious places for jewelry to “disappear.” If you are wearing jewelry, don’t forget that it may attract a lot of attention, especially in less secure places where muggings and kidnappings may be more common. If you are going to these places, it’s probably better to bring a minimal amount of jewelry with you. Insurance is not a substitute for prudence and safety.
As long as you have the right coverage, you’ve checked with your agent about policy requirements, and you are smart about what you take and how you take it, you really shouldn’t be too concerned about traveling with your jewelry. So enjoy your vacation (even if it’s with your relatives) knowing that your jewelry is properly covered!