There are several events that should trigger an insurance policy review. The least recognized event is Valentine’s Day. According to statisticbrain.com, 17.3% of all Valentine’s gifts will be in the form of jewelry and, overall, according to Businesswire.com, the US saw $316 Billion dollars in jewelry sales in 2016. That’s a lot of bling! Whether one receives jewelry on Valentine’s Day, or several times a year, a policy review is most likely in order after Valentine’s Day.
Why is reviewing a personal jewelry collection so important? Due to the ease of losing jewelry, home policies typically only provide $1,000 to $2,500 dollars in jewelry coverage on an unscheduled basis and will only cover for perils specifically listed in the policy. This may be adequate for a single person, or young, unmarried couple. However, the simple purchase of wedding rings, or the value of a collection of jewelry received over only a couple of years can surpass that limit handily. By reviewing a jewelry collection regularly, an insured is able to assess if they have the necessary amount of coverage to protect their collection.
Once a collection surpasses the coverage limits given in a typical homeowner’s policy, upgrading coverage is a necessity. There are two strategies, each with its own pros and cons. An insured can endorse their current policy with floater coverage, or they can purchase a stand alone floater policy. Each and every company provides different coverage amounts, however with an endorsement, typically an additional $5,000 to $10,000 dollars of protection is offered and will most likely be on a scheduled basis. Floater coverage endorsed onto a homeowner’s policy will be limited to the perils listed for the rest of the policy.
If the value of a collection exceeds what is stated above, purchasing a stand alone floater policy may be the best option. The perks to this type of policy are higher limits and broader coverage. This policy type will most likely be written on a scheduled basis; this means only items listed on the schedule submitted to the insurance company will be covered. This absolutely necessitates keeping an up-to-date inventory of jewelry holdings. Insurance carriers will most likely require a recent appraisal to be submitted with the schedule to verify the amount of coverage for which an insured is asking.
After Valentine’s Day is over, the first step a policyholder should take to ensure they have the correct jewelry coverage is to inventory all the jewelry in the home. Then, dust off the insurance policy and read the limits listed for jewelry. If the value of what is owned is exceedingly higher than the limits offered in a policy, call the insurance agent immediately to discuss the strategy that would be best suited to cover the policyholder’s particular needs.