How Does Jewelry Insurance Work & Do I Need It?

How Does Jewelry Insurance Work & Do I Need It?

Whether it's your favorite pair of earrings, wedding ring, or a family heirloom, your jewelry isn't only an expensive accessory, but it also has sentimental value. This is the reason why you wear your jewelry pieces with care and keep them in a safe place. One way to further protect these valuable possessions of yours is to buy jewelry insurance. Discover how jewelry insurance works and why it's worth getting.

What Is Jewelry Insurance?

Jewelry insurance is a type of insurance that allows you to claim reimbursement if your jewelry is lost, stolen, or damaged. However, you may or may not be fully reimbursed for your lost or damaged jewelry, depending on the coverage limit in your insurance policy. If you have full coverage, you'll receive either monetary compensation equivalent to the appraised value of your jewelry or a replacement that's similar to your original piece. In the event that your jewelry is damaged but can still be brought back to its previous state, your insurance may cover the repair costs.

What Kinds of Jewelry Are Covered?

Regardless of the type of jewelry you want to insure, you'll be able to find an insurance company that provides the coverage you need. Examples of commonly insured types of jewelry include:

  • Wedding bands
  • Engagement rings
  • Necklaces
  • Earrings
  • Bracelets
  • Watches
  • Pendants
  • Brooches
  • Loose stones
  • Entire jewelry collections

However, it's important to note that some insurance companies may take certain things into consideration before insuring your jewelry pieces, such as their overall condition and appraised values. You can find out from your agent whether your jewelry qualifies for coverage.

Does Your Homeowners Insurance Cover Jewelry?

A basic homeowners insurance policy provides some coverage for your valuable possessions, such as jewelry, artworks, fur coats, and antiques. This type of coverage is referred to as itemized or scheduled personal property. Nonetheless, in most cases, it'll only cover your jewelry up to a certain dollar limit.

A standard policy tends to have a low coverage limit for theft, which is generally around $1,500. This means your insurance company won't pay you more than $1,500 as reimbursement if your jewelry is stolen. If someone steals your $5,000 engagement ring, you'll be at a big loss. The rest of the cost of replacing your ring will have to come from your own pocket.

You have the option to increase the itemized personal property limit in your homeowner's insurance policy. However, you should know that there may be restrictions on the maximum amount of compensation you can claim. These restrictions may vary depending on individual jewelry pieces and overall losses.

Why You Should Get a Specialized Jewelry Insurance Policy

Raising the personal property coverage limit in your homeowner's policy is an easy way to get additional protection for your jewelry. Nevertheless, it may not be the best solution, especially if you have a highly valuable jewelry collection. A standalone jewelry insurance policy offers more comprehensive coverage than your homeowner's insurance policy. Although it's useful, a home policy only protects you against certain risks, such as theft. If you drop your engagement ring down the sink, have a chipped stone on your pendant, or damage your watch, you may not be covered.

Besides having fewer coverage gaps, a specialized jewelry insurance policy offers a number of other benefits that make it a worthwhile investment. These benefits include:

  • Higher coverage limits: Even if you add a jewelry floater to your home policy, there may be a cap on the maximum amount of coverage you can get. A standalone jewelry insurance policy tends to have higher coverage limits. You'll be better off getting this type of insurance if you have expensive pieces in your jewelry collection.
  • Lower deductible: If you file a reimbursement claim through your homeowner's insurance policy, you're required to pay the deductible, which is usually quite high. In some cases, the deductible in a home policy can be as high as $2,500. A specialty jewelry insurance policy, on the other hand, comes with a more flexible deductible. You can even opt for a zero-deductible policy, which means you'll get reimbursed for the full appraised value of your jewelry if something happens.
  • Lower impact of claims: There's a possibility that you'll lose your jewelry more than once, which can cause you to file multiple claims. With a basic homeowners policy, filing too many claims can lead to an increase in your premium or cancellation of your policy. This isn't the case with a jewelry insurance policy, which allows you to make claims without having to worry about your premium skyrocketing.
  • Worldwide coverage: If you left your expensive watch behind in a hotel room or have your necklace stolen while you're traveling abroad, you probably won't get any reimbursement from your homeowner's insurance provider. Most specialized jewelry insurance policies provide worldwide coverage for lost or damaged jewelry items, giving you the peace of mind you need to fully enjoy your vacation.

How Much Does Jewelry Insurance Cost?

Specialty jewelry insurance is actually quite affordable. It typically costs 1% to 2% of the total appraised value of your jewelry. If you want to insure a $10,000 wedding ring, you have to pay a premium of $100 to $200 a year. It's a small price to pay to protect your valuable assets. Some insurance companies may give you a discount if you take proper measures to safeguard your jewelry items, such as keeping them in a safety deposit box or installing a home security system.

How to Purchase Jewelry Insurance

The exact procedure for getting jewelry insurance may vary from one insurance company to another. However, you generally have to provide your insurer with the following:

  • Receipt for the purchase of your jewelry
  • Certificate of authenticity
  • Jewelry appraisal
  • Photos of your jewelry

With the availability of specialized jewelry insurance, you can keep adding new pieces to your jewelry collection without worrying that they'll be lost, damaged, or stolen. If you're looking for top-quality jewelry that features the finest materials and craftsmanship, consider shopping at Martin Busch Jewelers. Contact us today to find out more about our products and services.