Homeowners Insurance Pitfalls: Day 2 – Will Your Jewelry be Replaced?
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Every basic home insurance policy comes with some personal property coverage, but your average homeowners policy will not cover every type of property and often limits the amount it will pay out for certain types of losses.
Cindy Koegel, a Gillman insurance Problem Solver, sees this commonly create issues with fine jewelry that is lost or stolen. “In the event of a loss, say your house burns down or a valued piece of jewelry is stolen, many people think their homeowners policy will cover the full value of the jewelry, but that just isn’t so.”
She goes on to explain that often jewelry is subject to a value limit (think $2,500) and requires that the homeowner pay their deductible. “If your deductible is $1,000,” explains Cindy, “then really you’ve only received a pay out of $1,500 for a piece of jewelry that could be worth a lot more. That is why I always recommend that people schedule their jewelry.”
“That is why I always recommend that people schedule their jewelry” -Cindy Koegel
What is scheduling? Scheduled personal property is an endorsement that can be added to your homeowners insurance coverage, ensuring that you receive back the value of that piece of property in the event of a covered loss. People often schedule fine furs, antiques, paintings, guns, and yes, expensive jewelry.
Scheduling an item requires an appraisal first and foremost. You will then submit the appraisal to the insurance company with your request to have the item scheduled on the policy. Once your insurance company agrees to the value of the item, they will endorse the item and add it to your homeowners policy.
Scheduled Personal Property offers three advantages over a standard homeowners policy:
Scheduled items are covered based on a replacement cost value that has been predetermined. This means that the value of the item is not subject to depreciation based on the age of the item. You will receive a payout that covers the real cost of replacement based on the appraisal that was previously submitted.
Scheduled items are covered under more causes of loss. You can effectively gain coverage in the event of almost any type of loss, unlike a standard homeowners policy which may only cover a handful of standard perils. This means that even if you misplace a piece of jewelry, you can file a claim.
Scheduled items are not subject to a deductible. You are not responsible for paying any deductible on your item, which means all of the insurance money can go to replacement.
Be aware that most insurance companies set a limit on scheduled personal property coverage. Any items that you wish to insure which would exceed the limit would need to be insured under a separate policy. It is always best to talk to a trusted agent when making financial decisions.