96% of Stolen Jewelry Is Never Recovered. Can You Afford That Risk?
An average engagement ring costs nearly $6,000, and heirloom pieces and other kinds of jewelry could have significantly higher values. And while jewelry remains a top choice for thieves, most stolen jewelry is never recovered by law enforcement.
What’s more, this valuable property is often not adequately covered under the theft victim’s homeowners or renters insurance, leaving huge out-of-pocket costs for replacing an item that is stolen, lost, or damaged.
Here’s how to make sure you have enough jewelry insurance coverage for your treasures.
The Only Way to Secure Your Expensive Jewelry Forever
The average cost of an engagement and wedding ring set in 2014 was $8,000 ($6,000 for the engagement ring and around $2,000 for the wedding bands). Other precious items you own can be just as pricey—if not more—to replace.
According to the FBI, only 4% of jewelry is recovered after being reported stolen. The bottom line: If your ring is stolen, you are not likely to get it back. You need insurance coverage that helps you replace a stolen, lost, or damaged engagement ring and other jewelry without extensive out-of-pocket costs.
So how will you replace your jewelry if something happens? You can’t assume your standard homeowners or renters insurance policy is adequate. Yes, most homeowners insurance policies provide jewelry coverage, but it is limited, even if you have really good coverage. A typical limit for jewelry coverage is around $1,500 (after a deductible), and this is a combined limit that applies to all of the jewelry you have in your household. If you have any one item that is more valuable, your coverage for that item is still limited to $1,500.
In this scenario, your average-cost engagement ring ($6,000) has only $1,500 in insurance coverage. If it is stolen, you need to pay the difference ($4,500) if you want to replace it.
What’s more, most standard homeowners and renters insurance policies only provide jewelry coverage in response to certain “covered perils,” or causes of loss. Most do not cover jewelry for damage (e.g., bent prong and lost stone), or accidental loss (e.g., your ring is lost while swimming).
What can you do? You can add a scheduled personal property rider, or jewelry rider, to your homeowners or renters policy to increase the individual coverage limit on your jewelry. Each valuable piece can be listed on the rider, with a corresponding value for which it is insured.
How Do I Buy Jewelry Insurance and How Much Does It Cost?
The amount of jewelry insurance you need depends on the value of your engagement ring or other jewelry. Whether you want to insure precious gems or a piece with great sentimental value, here’s how you can be sure that you have the right amount of jewelry coverage.
- Know what you have. Take an inventory of all of the items that you wish to insure. Include photos and receipts where you can.
- Get an appraisal. The only way to know the true value of your jewelry items—and to insure them properly—is to get a professional appraisal. This will also document the features and specifics of your items for insurance and replacement purposes.
- Consider the risks. Insurance companies will also look at factors other than value to determine the coverage amount for a particular piece of jewelry. Very expensive items that require special storage might also require additional coverage. In addition, items that are worn regularly (e.g., an engagement ring) generally carry more risk than items that are worn infrequently and therefore have less exposure to loss or damage.
- Work with a qualified insurance agent. An independent Trusted Choice® insurance agent can help you evaluate all of your jewelry and valuable possessions and determine exactly how much coverage you need. In addition, your agent will help you determine if you need a special rider for your engagement ring or other valuable pieces.
- Evaluate your coverage regularly. Because the price of gold and other precious metals fluctuates, it is a good idea to get a new appraisal every few years and adjust your policy as necessary.
- Ask about discounts. You might be able to receive a discount on your premium if you have a home safe or an alarm system.
- Discuss coverage. Make sure you know if your policy covers only theft, or if it also includes coverage for loss and damage. Add coverage as needed.
- Discuss replacement cost vs. actual cash value. Your Trusted Choice insurance agent can explain the difference between replacement cost coverage and actual cash value coverage, and recommend the right choice for you. In general, replacement cost coverage will let you replace your lost or stolen item with a new item of equal value. Actual cash value coverage will only provide cash value equal to what the item cost at the time of purchase.
- Choose a reputable insurance company. Our agents work only with trusted, reputable companies that have experience covering valuable personal property.
You may be wondering what it costs to properly insure your engagement ring or other jewelry. You must purchase enough coverage to limit or eliminate your out-of-pocket costs should you have a loss. While it may seem like you are spending a lot, imagine trying to pay for your stolen item on your own, or worse, being unable to replace it at all.
On average, jewelry or engagement ring insurance should cost around $1 to $2 for every $100 in replacement cost. Simply put, expect insurance for a $6,000 ring to cost $60 to $120 per year. Rates can be higher in larger cities or areas where jewelry is considered more susceptible to theft.
If you keep your jewelry in a vault or a home safe when you aren’t wearing it, you might be eligible for certain discounts. In addition, the insurance company will consider your situation less risky if you take these precautions.
Will My Jewelry Insurance Policy Cover Loss and Damage, Too?
When looking for engagement ring coverage, other jewelry coverage, you must pay close attention to what types of losses your particular policy actually covers. Most will cover theft, but coverage for loss or damage is often limited or excluded.
Adding a special jewelry rider provides “all-risk” coverage. This means that the scheduled items are covered for all risks, including damage and accidental loss, not just theft, fire, or other perils outlined in the main homeowners or renters policy.
How Do I Find the Right Insurance Company to Insure My Jewelry?
While your jewelry may include some of your most precious possessions, it is not difficult to insure. Typically, you will add coverage for your engagement ring or other jewelry to an existing homeowners or renters insurance policy. As you add valuable items to an existing policy, you want to make sure your insurance company is still the best one for your needs.
You can shop for homeowners and jewelry coverage at the same time. Consider these tips for finding a jewelry insurance company:
- Check ratings from agencies like A.M. Best. These ratings are an important indicator of an insurance company’s financial health and ability to pay claims.
- How valuable are your items? Some insurance companies specialize in high-end pieces, heirlooms, or antiques. If your jewelry is fairly typical, you won’t need to work with one of these companies. But if you do have unique needs, there are companies that will be able to accommodate you.
- Evaluate coverage specifics. Not all companies offer the same coverage for the same types of perils (causes of loss). Be sure you know what you are purchasing, and how the quotes you receive differ from one another.
Remember to compare policies carefully and seek the advice of your independent insurance agent. One of our Trusted Choice agents can find the best combination of coverage and price to suit your needs and budget. Contact an agent today to help you sort through the best coverage and quotes for your jewelry.
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