Insurance Replacement

Most people do not learn they are underinsured or altogether uninsured until they file a claim with their insurance company. It is a common misconception that a homeowner's insurance policy fully protects individuals from the theft, damage or disappearance of jewelry and other valuables. In fact, most standard policies of this nature are peppered with fine print and have extensive limitations on coverage for jewelry, but most people do not learn they are underinsured or altogether uninsured until they file a claim with their insurance company. When that moment comes, it is usually too late to make other arrangements to guarantee protection from the financial burden of replacing what one has lost.

In fact, even if jewelry is covered under a home policy, it is subject to potentially expensive deductibles that can range from hundreds to even thousands of dollars depending on the provider and the client's preferences. Additionally, any insurance claims filed in this manner can affect the premiums on a homeowner's policy once it comes up for renewal -- a premium increase that could be higher than the amount received to replace the lost or damaged piece in the first place. Even high-end carriers have limitations regarding jewelry. While these companies do offer broader protection, the broker must still be consulted in order to establish a sensible coverage plan for specific items.

Insurance replacement

Navigating this process can be challenging, but it is important in order to safeguard a jewelry collection for the long term. This is why it is essential to utilize a broker that can provide assistance in building an insurance program that protects a client's best interests. Since brokers work with multiple insurance companies, they are aware of the pros and cons of each policy and will be able to recommend the best option for an individual's unique needs. It is always better to have a strategy in place that may include a mixture of jewelry coverage, itemized (coverage for a defined piece of jewelry) and blanketed (a set amount of coverage that does not require a specific list of all of an individual's jewelry items).

Blanketed jewelry coverage is underutilized, and is a wonderful solution for items that are $5,000 or less in value. Also, there are lower rates available for items stored in bank vaults, which may be a good solution for larger, more important pieces that are worn fewer than five times annually.Regardless of coverage, it is a best practice to have a thorough appraisal conducted on a jewelry collection every five years (or every two years for high-value pieces) by a trusted and reliable source in order to determine the proper insurance amount. 

This practice guarantees that one's items are always fully insured to current market values, which minimizes financial risk. If it has been several years since a collection has been reappraised, one could not, with complete certainty, replace the item with an exact match -- especially if the piece is gold, platinum, or a diamond, as these materials have seen a large increase in value during the last few years. This approach has an added bonus: an appraisal report will include detailed information about a collection in the event of a loss. Unfortunately, anyone may present himself or herself to the public as a personal property appraiser, since it is a field that remains largely unregulated.

It is important to seek out an individual or a company that has the proper training, credentials and background to provide a trustworthy report and appraisal. TIVOL appraiser Lindsay Ross received her Graduate Jeweler Gemologist designation from the Gemological Institute of America in 2004.