Personal Articles Insurance

If any of the following incidents were to happen, do you know if your homeowners insurance would pay the full claim, part of the claim, or deny it completely?

  • Your golf clubs are taken out of your car.
  • Your expensive digital camera is dropped and broken.
  • Your home-office computer is ripped off.

Unfortunately, with just a standard homeowners insurance policy, the likelihood of your full claim being paid is not great.

While your homeowners insurance policy does provide some coverage for valuable items, it is usually limited in the types of covered claims and payment amounts.

In order to have full coverage for the incidents above you would need to purchase a Personal Articles Floater. A personal articles floater provides coverage for possessions with higher monetary values like:

  • Cameras (video or still) and related equipment
  • China and crystal
  • Firearms
  • Golfer’s equipment
  • Jewelry
  • Musical instruments
  • Personal computers
  • Silverware
  • Works of fine art

It will also provide some additional coverage for things like mysterious disappearance and breakage. And the best part is that this type of policy isn’t very expensive at all.

Why should I consider a Personal Articles Floater?

Benefit 1: A personal articles floater will provide higher limits on your valuables.

Standard insurance policies limit coverage for the items listed above at anywhere from $500 to $1,500 depending upon the item. In many cases that may be sufficient; however, if the item is rare or valuable, the regular might not be enough.

One of the benefits of a personal article floater is the freedom you have in selecting your limits. Rather than predetermined limits, insurance companies are more willing to provide higher limits (as long as you can provide proof of said value).

Benefit 2: Claim payments are facilitated in a more proficient manner.

Claims for a personal articles floater usually paid one of two ways:

  1. Replacement Cost: Your insurance will pay the necessary amount to repair or replace your item with another one of like kind and quality.
  2. Agreed Value: The insurance company will use an “Agreed Value” limit for the item. This means that, in the event of a covered claim, your insurance company will simply just pay you the amount listed on the policy.

An agreed value limit is great when you’re insuring items like jewelry, fine art, antiques, and other unique items because it means if you suffer a loss on a covered item, you will not have to negotiate a settlement price with the insurance company.

Benefit 3: A personal articles floater provides expanded coverages.

A standard homeowners policy does not include some vital coverages for rare or valuable items. For example, a personal articles floater can provide coverage for “mysterious disappearance” or “breakage.” So if you were to lose a valuable piece of jewelry or accidentally break some fine china, your policy would pay the associated claim.

Benefit 4: Coverage can be expanded worldwide.

While most homeowners policies will typically only cover items located on the premises listed within the policy, personal articles floaters will provide coverage anywhere in the world.

For example if you lost your expensive camera while on vacation, your policy would pay for a replacement.

Benefit 5: Most personal articles floaters do not have a deductible.

A standard homeowners insurance policy will usually include a $500 to $1,000 deductible. A personal articles floater is different; many of them actually remove the deductible removing any out-of-pocket expenses as the policy owner.

Some Tips when Adding this Coverage

  1. Make sure to keep a detailed list of the items listed on the policy, including copies of the appraisals.
  2. Photograph each piece of your collection and store the photos in a safe place. This will make it easy to list each item on you claim report if your entire collection is stolen or damaged.
  3. If you have a number of high value items, it may be in your best interest to store them in a safe deposit box or install a security system in your home. Doing so will help discount the premiums on your policy as well.

How Much Does the Coverage Cost?

Now the big question, right? How much does a policy of this type cost?

Personal article floaters are actually much cheaper than you think given the coverage they provide. The increased cost can be anywhere from $20 to $2,000 annually, depending upon the type of items insured and their associated value.

*The above information is to be used as guidance only, and should not be considered as definite in any particular case. Every policy is different and you need to read through your policy and consult with your agent to best determine how your coverage will respond. Within this article we simply cannot analyze every possible loss exposure and exception to the general guidelines above.

 

How to Properly Insure Jewelry

Insuring Jewelry

Knowing how much personal property coverage you have on your homeowners or renters policy is a good place to start with insuring jewelry. Most of the time, you’ll be covered up to a certain limit if it is stolen ($2,500 total). But with the average value of an engagement ring in the US costing around $5,000, homeowners insurance policies will most likely not cover the full value.

Since your standard policy most likely only covers part of your jewelry’s cost (and there’s usually no coverage for items that are lost or damaged), you may have to add additional coverage to insure the full cost should you ever need to replace your jewelry. This is done through a personal articles floater attached to your homeowners policy.

For high valued items, like engagement rings, the item is on a “schedule” and insured separately. Usually you can expect to pay around $1-2 per $100 of the item value. If the ring or piece of jewelry is brand new, the receipt from purchase can help determine the value.

Prior insurance carrier declarations are also good documentation to have on hand if your jewelry has been previously insured. It’s a good idea to get a professional written jewelry appraisal done to make sure that the item is being insured at its correct value. This is especially true if the jewelry is an heirloom or hasn’t recently been purchased.

Remember that the value of jewelry can change over time. It is important to have a recent appraisal done every 2-3 years and update your policy when the value of jewelry changes to ensure adequate coverage.

Another important factor is insuring your new jewelry in a timely fashion. You’ll want to make sure you’re covered even if something were to happen in the days after purchasing or receiving it as a gift.

Once you have jewelry insurance, keep your current appraisal, policy information, and any documentation about the piece in a safe place should you ever need to make a claim. It’s recommended you also take pictures of the pieces (which should be included in a professional written appraisal).
*The above information is to be used as guidance only, and should not be considered as definite in any particular case. Every policy is different and you need to read through your policy and consult with your agent to best determine how your coverage will respond. Within this article we simply cannot analyze every possible loss exposure and exception to the general guidelines above.