Insurance can definitely be confusing, and understanding what is or isn’t covered under your homeowners or renters insurance policy is no exception. You probably have a lot of items in your home or apartment, which may include some valuable, higher-cost items. Even though these high-value articles may be covered by your homeowners or renters insurance, the coverage is limited in many cases. For instance, the standard homeowners policy provides only $1,000-1,500 for theft of jewelry, watches, furs, and precious and semi-precious stones—and there is no coverage for damage or mysterious disappearance. Fortunately, there is a way you can schedule these possessions to ensure they can be repaired or replaced, or the full value received in the event of a loss.
Let’s take a closer look at jewelry coverage. To have an article of jewelry covered for its full value and for perils in addition to theft—like damage or mysterious disappearance—you need to schedule it. That means you have the article appraised (depending on the value) and listed individually on the policy. By scheduling it, you can get protection from a wider range of dangers. The value, in the event of a total loss, is the actual cost to repair or replace the item.
If you feel more comfortable knowing exactly what you will receive for an item in the event of a total loss, you can cover the article on an agreed value basis. With agreed value, you and your insurance carrier agree on a set value for the article in advance. Then, in the event of a covered total loss, the full agreed value is paid to you.
In this blog we covered jewelry as an example, but there are other high-value items you might want to consider scheduling, including fine arts, stamp or coin collections, collectible sports memorabilia, or high-priced technology items. Talk to your insurance agent if you own these types of property, and he or she can instruct you on how a loss would be handled before it occurs, helping to uncover any potential coverage gaps.
The bottom line is that internal limits in your policy control how much coverage you have for certain types of property. Be sure you know these limits and secure additional insurance in situations where the internal limit doesn’t meet your needs.