Is Insuring Your Jewelry Worth the Money?

With the average cost of an engagement ring in the United States surpassing $6,000 in 2017, it’s safe to say that jewelry is among the most expensive personal possessions you could own. Adding in the sentimental value that often comes attached to jewelry, it can be emotionally and financially devastating if an item is damaged, lost, or stolen. Because of this, many people turn to purchasing insurance plans specifically meant to cover jewelry and other heirlooms. But is purchasing jewelry insurance just in case something happens financially a good idea?

What Is Jewelry Insurance?

Jewelry insurance is a lot like any other insurance policy you have on personal property, such as auto or home insurance. It protects your valuables in the event of damage, loss, or theft, and can pay to repair or replace these items. Premiums for jewelry insurance typically run $1 or $2 per $100 of the piece’s value per year, so a $10,000 necklace would cost you $100 to $200 per year to insure. These policies also include deductibles, or portions of the repair or replacement cost that you must front before the insurance company will pay.

Can’t I Just Cover My Jewelry Under My Homeowner’s Insurance?

Yes, you can, but there are some conditions that may make purchasing a separate policy necessary. Some homeowner’s insurance policies only cover up to a certain amount, say $10,000 of unscheduled individual property. Unscheduled property is considered anything of value in your home that you don’t specifically list in your policy, such as televisions, computers, and furniture. If your home is broken into and you lose televisions, sporting equipment, electronics, and jewelry, the total cost of these unscheduled items easily can surpass $10,000. That would mean you will need to pay out-of-pocket to replace anything over and above that $10,000.

You could also talk with your insurance agent about adding a specific rider to your homeowner’s insurance just for your jewelry, though the premiums for this rider may be more than purchasing specific jewelry insurance. And, the terms for repair or replacement are likely to be much more strict than a jewelry-only policy, meaning there will be fewer qualifying events where your insurance company would pay out.

What Does Jewelry Insurance Cover?

The actual coverage under insurance for jewelry varies from policy to policy and company to company. Most policies fall into two main categories: scheduled policies and unscheduled policies. With scheduled policies, all covered pieces are listed specifically in the policy. For example, if you had an engagement ring, two necklaces, and an antique watch you wanted covered, your insurance policy would specifically list these items. For an unscheduled policy, however, all items up to a certain value are covered, so you don’t have to list individual pieces. There can be unscheduled portions of an otherwise scheduled policy as a catch-all for other items of jewelry.

In many cases, jewelry insurance will cover certain damage, loss, or theft of jewelry. These terms will all be listed out in the fine print of any insurance policy, so read your contract carefully and ask your agent as many follow-up questions as necessary to clearly understand everything. In some policies, damage to a ring from a broken prong is covered if you can show that the damage was accidental, but not if there was any negligence on your part, such as wearing it while at the gym or doing other heavy activities.

Your contract also will cover the terms under which any lost or stolen jewelry will be replaced. If you have a one-of-a-kind or custom piece, make sure to ask how they handle replacements. Some companies will allow you to use your own jeweler, while others require that you work with their chosen jeweler. Find out the specifics of your individual policy to avoid headaches and heartbreak down the road in case something happens.

What Will Be Required To Get My Jewelry Insured?

At the very least, your chosen insurance company will require an initial appraisal of all insured pieces to determine how much they are worth. This helps you purchase the right amount of coverage, and allows your insurance company to know if you are overestimating the value of any individual pieces. Some companies will give you discounts on your premiums if you have a home security system or home safe for storing your insured valuables.

If possible, keep receipts and any verification certificates for your insured pieces. While this isn’t often possible for those antique heirloom pieces, it’s good practice to keep these records on any new jewelry you purchase. Additionally, take frequent photographs of your jewelry and get your frequently worn pieces inspected by a jeweler on a regular basis to check for wear and tear. You also will want to have your pieces reappraised every few years, as the price of stones and metals fluctuates, so a piece worth $15,000 now may be worth $20,000 in five years. Keep all records related to your jewelry and insurance policy in a safe place should you need to make a claim.

So, Is Jewelry Insurance Worth the Money?

If you have lower-value items or feel you could easily replace any important pieces if they got lost or damaged, jewelry insurance may not be right for you. However, if you own a lot of jewelry, own high-value pieces, or if you don’t feel you could replace that special necklace on your own if something were to happen to it, jewelry insurance might be a good fit. No matter what, you are paying for any damage or replacement to your jewelry – it’s just a matter of whether you’re paying for it all at once or paying a little bit now in case something happens down the road.

Gorgeous Custom Jewelry in Frederick, Maryland

At Gold Thumb Jewelry, we make it our mission to find the right piece of jewelry to suit every style and taste. We offer a wide selection of diamond and other gemstone jewelry, or choose our custom design services to create a piece that’s one-of-a-kind. Contact us today to discuss your jewelry needs!