With consumers estimated to spend over 17 billion dollars on Valentine’s Day gifts this year, it is extremely important that expensive items such as jewelry or electronics are properly insured.
Engagement rings and other expensive jewelry are perennially favorites for Valentine’s Day gifts, but with the soaring popularity of electronics of all types some people may feel that nothing says ‘I love you’ like a new TV, tablet, or iPhone.
If you receive an expensive gift, you should contact your insurance company immediately in order to determine whether additional insurance is needed or whether you simply need to store the receipt and add the item to your home inventory.
Standard homeowners and renters insurance policies include coverage for jewelry and other valuable items such as furs. However, many policies limit the dollar amount of coverage for the theft, or loss due to a covered peril, of such items—the limit is usually $1,000 to $2,000. In terms of electronics, there may also be a category limit, so consumers should check with their company to see if they need to raise the limit. To properly insure jewelry and other expensive items, consider purchasing additional coverage through a floater or an endorsement.
With floaters or endorsements, you are also covered for “mysterious disappearance.” This means that if your ring falls off your finger or is lost, you would be financially protected. There are no deductibles and frequently you will have the option of having the insurance company replace the item for you.
Floaters and endorsements are available as additions to homeowners and renters insurance policies. Prices for floaters and endorsements will vary depending on the type of jewelry, the insurance company you choose, where you live and where the item will be kept. In addition to jewelry, floaters are also available for furs, fine art, musical instruments and even golf equipment.
To make sure your jewelry and other valuables are adequately protected, consider the following:
Contact Your Insurance Agent ASAP
Let your agent or company representative know that you are now in possession of an expensive piece of jewelry or other costly items. Find out how much coverage you have and whether additional insurance is needed.
Have the Item Appraised
Heirlooms and items that were purchased several years ago will need to be appraised for their dollar value. Ask your insurer for recommendations regarding a reputable appraiser. It is important that expensive items be appraised properly. If you purchase a floater or endorsement, your premium will be based on the appraised value and in the event of a claim you will be compensated accordingly.
Keep a Copy of the Store Receipt
You should forward a copy of the receipt to your insurer so that the company knows the current retail value of the item. Keep a copy for yourself and include it with your home inventory.
Store Valuables in a Secure Location
Protect your jewelry by storing it in a secure location in your home. If you do not plan to wear the item regularly or are holding it for a child, consider keeping it in a safe deposit box. You may save money on the cost of insuring it as some companies offer “in vault” coverage. If you want to wear the jewelry for a special occasion, many insurers will offer the option of purchasing additional coverage for the time it is out of the bank; you do, of course, have to notify your insurer ahead of time if you plan to do this.
Update the Value of Your Valuables
Expensive items can go up or go down in value. Talk to your insurance professional about how to make sure the dollar amount of your floater or endorsement reflects these changes.
Take a Picture of the Item or Collection
Get into the habit of keeping a visual record of all of your personal possessions. This helps to document your loss and can speed up the claims process. It is also useful when documenting antique and unusual pieces of jewelry.
Add the Item to Your Home Inventory
Everyone should have an up-to-date inventory of their personal possessions, including valuables. This can help you purchase the correct amount of insurance and will make the claims process easier if there is a loss. You can add a digital photograph of your new gift and save scanned receipts. Computerizing your inventory also makes updating it fast and easy.