Valuables insurance is additional coverage you can add to your existing homeowners or renters insurance to protect your cherished items such as jewelry, art collections, antiques, musical equipment, and high-end electronics. This insurance typically offers higher coverage limits and broader protection than standard homeowners insurance.
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Planning for the Unexpected: The Importance of Valuables Insurance
While most standard homeowners and renters insurance covers precious items such as fine jewelry, art, and instruments, the coverage limits are often low. Some policies may contain stipulations on which high-cost items can be covered. For example, your high-value items may only be covered if the loss resulted from perils included in your standard homeowners policy, such as fire, theft, and vandalism. In other words, if you accidentally dropped your engagement ring down the kitchen sink, your policy may not cover it.
So, if you keep precious personal belongings in your home, you may want to purchase valuable insurance in addition to your standard homeowners insurance. You can do so by buying blanket coverage or individually scheduling the items you wish to insure on the policy. We’ll touch on these two coverage options later in the article.
What Does Valuables Insurance Cover?
Insurance companies consider many personal belongings high-value. Some of these include the following:
- Jewelry: This includes engagement rings, necklaces, bracelets, and more. Some insurers may also offer jewelry coverage as a stand-alone product.
- Fine Art: Fine art encompasses paintings, sculptures, drawings, and photography, among other genres.
- Antiques: Antiques are vintage objects with historical and financial value. An object must typically be at least 100 years old to be considered an antique.
- Collectibles: A collectible is an item worth more than it was initially sold for due to its rarity or popularity. Some common collectibles include comic books, coins, and vinyl records.
- High-End Electronics: This includes laptops, home theater entertainment, TVs, speakers, electric massage chairs, and more.
- Musical Equipment: Valuables insurance also covers musical equipment such as pianos, guitars, drums, violins, etc.
- Firearms: Firearms means guns, rifles, pistols, or handguns. Some insurance companies may offer stand-alone policies.
What’s Not Covered?
Most insurance companies are unlikely to cover damages caused by general wear-and-tear or extreme situations such as war or nuclear hazards. However, these exclusions may vary depending on the insurer. Check with your insurance provider before purchasing add-on coverage to know exactly what your policy covers.
The Benefits of Being Covered
While purchasing additional coverage may increase your premiums, it provides various benefits that could offer you peace of mind, such as:
- Financial Protection: Standard homeowners or renters insurance typically only covers losses associated with fire or theft — not accidental damage or loss. However, if you purchase additional coverage for your high-value objects, you could receive reimbursement if your items are lost or damaged.
- Sense of Security: With adequate coverage for your valuable items, you can replace or repair them without hurting your finances.
- Fits Your Individual Needs: Most insurers allow you to customize your coverage amount according to how much your possessions are worth.
If the coverage limit of your existing homeowners or renters insurance is insufficient, you could access additional valuables insurance coverage in two ways: purchasing a blanket coverage or individually scheduling the valuable item you want to insure.
Scheduling an item means adding a specific item to your policy. You should schedule an item if its value exceeds your homeowners insurance coverage limits. For example, standard homeowners insurance policies typically have a relatively low limit of liability for theft of certain items — such as jewlery — generally around $1,500. So if your jewelry costs $10,000, it’s a good idea to purchase scheduled personal property insurance, a rider you could add to your existing policy.
The cost of scheduled personal property insurance depends on the item and the insurance company, but you can expect to pay around 1% to 2% of the item’s value. While scheduling items will raise your premium, it ensures your items are adequately covered. One perk of scheduling your valuables is that you typically do not need to pay a deductible when you make a claim. However, depending on the value of each item, your insurer may require you to provide an appraisal before extending coverage.
Unlike scheduled personal property insurance, blanket coverage allows you to cover multiple items with one rider instead of purchasing a separate rider for each item. However, blanket coverage may have a sub-limit for each item. For example, if your blanket coverage has a limit of $5,000 for valuables, each item may only be covered up to $1,000. Because blanket coverage is more affordable than scheduling individual items, it could make financial sense if you own multiple valuable items worth under the sub-limit amount.
How Much Does Valuables Insurance Cost?
Many factors can influence how much you pay for valuables insurance, including:
- Appraised Value: The higher the appraised value, the more expensive it is to insure the item.
- Deductible: Typically, the higher the deductible amount, the lower the premium cost.
- Location: Places with higher rates of natural disasters or theft may result in higher premiums.
- Type of Item: Coverage amounts could vary depending on the item you want to insure, which affects your insurance costs.
- Age of Item: Items more susceptible to damage due to age may be more expensive to cover.
Remember that insurance costs vary depending on the insurance company and specific policy, so always shop around to find the most suitable option for your situation.
How to Get Valuables Insurance
Before purchasing additional insurance for your prized possessions, read the fine print of your homeowners or renters insurance policy to understand the coverage limits. If it’s not enough, do not worry. Most insurance companies allow you to purchase valuables insurance on top of your existing policy. Contact your insurance agent to see what options are available and learn more about the limits and exclusions that come with additional coverage.
Also, consider scheduling appraisals for your high-value items to ensure your desired insurance policy’s coverage limits offer adequate protection. Note that some policies may require appraisals for coverage if your item is worth $100,000 or more, so check with your insurance provider beforehand. Once you’ve decided on a policy, keep it up-to-date by updating it when you acquire new high-value items.
If you do not have homeowners or renters insurance, you may be able to find insurers that offer stand-alone policies that cover solely the items you’re looking to insure, such as jewelry. Be sure to compare coverage limits and quotes from various insurers before making a decision.
Filing a Claim
If your items were unfortunately damaged or stolen, you could file a claim with your insurance company by taking the following steps:
- Review Your Policy: The first thing you want to do is review your insurance policy and understand the steps you need to take and what exactly is covered.
- Make a List of Damaged/Stolen Items: Then, create a list of the damaged or stolen items. Be as detailed as possible, and take the time to double-check and ensure you’ve included every item.
- Gather Documentation: This could include appraisal paperwork, photographs, evidence of a natural disaster or theft, etc.
- Contact Insurance Company: Once you have your supporting documents ready, initiate the claims process by contacting your insurance company. Some insurers may allow you to file a claim online or by phone.
- Collect Reimbursement: After successfully filing a claim, your insurance company will look at the damage and determine your settlement amount. You’ll typically receive the reimbursement through a check or via direct deposit.
Tips for Protecting Your Valuables
Losing your prized possessions such as a wedding ring or vintage silver collection can be emotionally and financially devastating. Here’s how to ensure your valuables are adequately protected at all times.
- Make a home inventory. To keep track of the precious items in your home, create a home inventory or a catalog of your high-value personal belongings. You can do so by filming videos or taking pictures of each item. Do not forget to include information such as the item’s original value as well as the date and place of purchase.
- Schedule appraisals. If you’re unsure how much your items are worth, schedule an appraisal with a professional. Appraisals are critical if your valuables appreciate with time, such as rare art, fine wine, or silver.
- Review your policy annually. Check your policy annually to ensure the coverage reflects the current value of your possessions.
- Consider purchasing a protection plan from the merchant. When you purchase a high-end product such as a diamond earring or gold watch, consider purchasing a protection plan from the merchant. While it typically comes with an additional fee, a buyer’s protection plan could offer additional coverage on top of your homeowners policy.
All in All
Most standard homeowners and renters insurance does not provide enough coverage for high-value items, so not having additional coverage for your prized possessions means you might not receive reimbursement if something unfortunate happens to them. Consider purchasing valuables insurance if you own high-value items such as diamond rings, fine art, a rare coin collection, or expensive musical instruments. If you’re unsure about whether valuable insurance makes financial sense for you, chat with your insurance agent to explore your options.