Roses are red… violets are blue… my jewelry was just stolen… what should I do?
As we say farewell to Valentine’s Day, many homeowners will be wondering, “Is this beautiful new piece of jewelry covered by my home insurance policy?”
While personal property coverage is included under most standard home insurance policies, there are a few exceptions when it comes to valuable items such as jewelry.
According to the Florida Department of Financial Services, standard home insurance policies usually have special limits for coverage on jewelry and other valuable personal items in order to keep premiums at a reasonable price.
In the case of People’s Trust Insurance, a standard HO3 policy maintains a $1,000 limit for loss by theft of jewelry, watches, furs, precious and semi-precious stones.
It is important to review your People’s Trust Insurance policy to confirm your level of coverage. If you need more coverage, you may be able to add an endorsement to your current policy.
Endorsement Options: Blanket Coverage vs. Scheduled Coverage
With a blanket coverage endorsement, you set a total insured amount for all of your jewelry, rather than each individual piece. Though not required, you may want to appraise your jewelry to prove ownership and value in case you need to file a claim.
Advantage: Blanket coverage does not have a deductible and usually covers more risks than a standard homeowners insurance policy.
Disadvantage: Blanket coverage policies generally have per-item claim limits of $1,000 to $5,000.
With a scheduled coverage endorsement, you itemize all jewelry items you want to insure. Scheduled coverage protects against all types of loss and damage, with the exception of normal wear and tear.
Depending on eligibility, scheduled coverage may increase coverage limits to $10,000 or more. This endorsement does not factor in appreciation, so you should periodically appraise your jewelry to ensure you’re receiving adequate coverage.
Advantage: Scheduled coverage offers “mysterious disappearance” coverage, so if you lose a piece of jewelry, it will be covered. Since you have to appraise items in order to schedule them, this ensures that you’ll receive the correct amount of coverage for each item.
Disadvantage: Scheduled coverage is more expensive and requires you to appraise items.
Which Coverage Option Is Better?
Once again, it all depends… The New York Times recommends adding blanket coverage for less expensive items like smaller pieces of jewelry. For more valuable items, especially expensive jewelry worn on a daily basis, scheduled coverage is highly recommended.
Replacement Cost Coverage vs. Actual Cash Value Coverage
In case of jewelry or other personal property loss, it’s important to understand the difference between Personal Property Replacement Cost and Actual Cash Value coverage.
A standard homeowners policy includes coverage for your personal property at Actual Cash Value that factors in depreciation at the time of loss. If you select the Personal Property Replacement Cost coverage endorsement, for an additional premium, People’s Trust Insurance will settle losses to your specific personal property at the current replacement cost without considering depreciation.
The Personal Property Replacement Cost endorsement also provides replacement cost for several building items that would otherwise be limited to Actual Cash Value. This includes: awnings, carpeting, household appliances, and outdoor antennas/outdoor equipment.
No matter what type of home insurance you have, it’s important to have a recorded inventory of your personal property along with proof of value in case something were to happen.