Is your coverage a “gem”?
Most home insurance policies limit the amount payable for jewellery claims. $6,000 is a common limit found on many policies. Keep in mind that the jewellery limit is for all jewellery lost in a claim, and not for each item. Several pieces can exceed $6,000 quite quickly.
Scheduling more valuable jewellery is a relatively inexpensive way to obtain additional coverage. Scheduling provides a limit of insurance for a specific item based on a jewellery appraisal which is submitted to the insurance carrier. In the event of a claim, many insurance carriers will direct you to a jewellery wholesaler or manufacturer. Often your piece of jewellery can be replaced for as little as 50% of what you paid at your local jewellery store.
Some carriers offer scheduling on a “valued” form which in the event of a loss pays out the scheduled amount regardless of actual replacement cost. The example below will illustrate the differences between the three forms of coverage.
Let’s assume the lost ring was bought for and appraised at $15,000. The home policy carries a jewellery limit of $6,000. The jewellery wholesaler can replace it for $9,000.
- Not scheduled – even though the least you can replace it for is $9,000, the most you will receive for this loss is the $6,000 jewellery limit on the policy.
- Scheduled for $15,000 – you can either replace the item at the wholesaler or cash settle for $9,000 remembering the $15,000 limit is a maximum, not what you would receive in the event of a loss.
- Scheduled under a “valued” form for $15,000 – you can replace the item at the store of your choice (up to the scheduled limit) or cash settle for the $15,000.
Don’t wait until after the fact to explore your best options for insuring your jewellery…