Insurance experts warn that your homeowners or renters policy often won’t replace higher value items if they’re damaged or destroyed. Similarly, your policy might not cover your most unique or sentimental possessions.
Special items warrant special coverage
For unique and hard-to-value possessions, it’s best to go with an insurer that specializes in such items, says Jaclyn Krywar, who works for QBE Specialty Insurance. The insurer covers everything from engagement rings to rare book collections, your grandmother’s brooch or the Lladro collection in your living room hutch — even a million-dollar wine collection.
“A company that specializes in underwriting valuable articles can provide the most competitive pricing, broadest policies, and in the event of a claim, accurate estimates for replacing or restoring an item,” she says. “Specialty insurers can also provide more flexible, tailored coverage than a standard homeowners’ insurer and with no deductible.”
For example, if you have a decadent wine collection, QBE Specialty’s wine policy includes risks that aren’t often covered, like breakage, label restoration and spoilage due to mechanical breakdown of a cellar. And if you have historical memorabilia or a fine art collection, Krywar’s company would cover the risk of lending these to a museum as a loan or on exhibition.
For off-beat and sentimental items, like your family heirloom Civil War rifle or that costume from Star Wars you bought on eBay, you’ll likely need a specialty insurer in order to find coverage. However, Krywar says most specialty policies protect more common valuables like a family’s wedding china or silverware, a few paintings and a small jewelry collection.
“Large or small, and even if you can’t put a value on it, be sure to insure it,” she says.
A floater could float you
Another option is inland marine coverage (often called a “floater” or “scheduled personal property”) that’s added to your homeowners or renters policy. This will boost your limit and broaden your “cause of loss” for specific items.
Why is that important? Take a wedding ring. The average cost of a diamond ring is almost $4,000. But if it’s stolen your standard homeowners policy would probably only cover about $1,000. And on a standard homeowners or renters policy, jewelry is covered for “named perils” like fire, theft or lightning. When scheduled separately, it’s covered on an “all-risk” basis, even if you drop your diamond into the running garbage disposal.
“Jewelry is valuable, and it’s easy to lose and easy to steal,” says Jonathan Farris, assistant vice president at QBE Regional Insurance. “When it’s scheduled, you can rest assured that it will be covered no matter how it’s lost.”
Farris adds that most consumers find the cost of scheduling to be very reasonable. For example, to cover a $3,000 ring costs about $30 a year on a policy from QBE Regional’s General Casualty or Unigard brands.
When deciding which items to schedule, the experts say to consider anything valued over $1,000 or any group collectively valued over $2,000 (think china set).
“Schedule items you couldn’t afford to replace on your own,” Farris says. “And consult with your independent insurance agent to make sure your most prized possessions are adequately protected.”
Courtesy of ARAcontent