Whether it's your diamond engagement ring or fine art, the treasures you value most may be the hardest — and most expensive — to replace.
Sure, your renters or homeowners insurance policies will provide some protection. "But is this coverage enough?" asks Barri Pool, assistant vice president in USAA P&C Underwriting.
While a standard renters or homeowners policy may cover some personal belongings, they typically only insure for specific types of losses, such as fire, theft, hail or wind damage. You'll also generally pay a deductible before the insurance kicks in. And don't forget there may be coverage limits, meaning your insurance pays only up to a certain amount.
For broader protection, Pool recommends valuable personal property insurance. This coverage can help you replace certain treasures -- furs, jewelry, cameras, musical instruments, fine art, silverware, guns and stamp and coin collections -- in the event of a loss. If your wedding ring or silver serving pieces are stolen, they may be subject to a deductible under your homeowners or renters insurance policy. In addition, such policies put a dollar limit on valuable personal property.
Valuable personal property insurance, however, can cover an item up to its replacement value -- with no deductible. And coverage isn't usually restricted to natural disasters and theft. If a stone falls out of your engagement ring or you lose the emerald necklace handed down from your grandmother, those losses are typically covered, too.
Remember, most insurance companies that offer valuable personal property insurance require that you carry a homeowners or renters policy. And no matter what kind of policy you have, know the limits.
How to Get the Most Protection
Thinking of purchasing a valuable personal property insurance policy? To ensure your items receive the most comprehensive protection possible, follow these steps recommended by USAA.
- Check your current coverage. Before getting an additional policy, review your homeowners or renters policy and fully understand what the policy covers and what it doesn't.
- Update the appraisals. Keep appraisals current (at least every five years), and notify your insurance company if the value changes. Appraisals should be done by a certified professional appraiser with expertise and credentials in the type of item you are insuring.
- Keep all documentation. Proof of ownership is required when you report a loss, so the more paperwork you have -- receipts, appraisals, financing statements, and repair or cleaning bills -- the easier it will be if you have to make a claim.
- Details matter. Provide your insurance company with a full description of each item. For example, if you are insuring a diamond ring, you want to list the cut, clarity, carat, color, number and measurements of the diamonds, and the type of gold -- the more detail the better.
- Do your part. Keep your valuable possessions properly cleaned, maintained and safely stored to avoid damage, loss and theft