Home Insurance, Jewelry and other Valuables

Home insurance is the way to protect your home and valuables, but did you know your standard home insurance policy might not provide full protection? Typical standard homeowners insurance provides you four areas of coverage -- the structure of your house, your belongings, liability and expenses in case you are temporarily forced from your home because of an insured disaster.

If your belongings include items such as valuable jewelry, fur coats, vintage musical instruments or even a stamp collection, those valuable items might not be fully covered under your home insurance policy. The reason for this is certain items covered by your home insurance policy have special limits on how much your insurer will pay in the event you have an insurance claim on that item. Jewelry is a good example because it can be easily stolen, and thieves often seek out jewelry during home robberies. Home insurance providers create a low limit of liability for loss of jewelry, typically around $1500. Obviously it is very easy to own jewelry that exceeds that figure.

The way to ensure your high-end valuables are covered under your home insurance policy is to review your valuables to first determine if their value exceeds the liability limit and if so by how much. If your valuables don’t go too far over the limit of your home insurance policy you can increase your coverage by raising the limit of liability. This is the less expensive option to cover your valuables, but there will still be limits on how much you can claim. There will also be limits on coverage for individual items. For example your new liability limit might be $5000, but your home insurance policy might limit liability for any individual item to $2000.

The second method to ensure your valuables are covered is to “schedule” each individual item through a “floater” policy in addition to your standard home insurance. The value of items to be insured via floater policies must be appraised and the coverage is more expensive than raising your liability limit. In return the floater policy gives these items much broader protection that covers any type of loss, including accidental loss that your home insurance policy would not cover.

Premiums on floater policies are largely set by the value of the insured item, so an accurate appraisal is in your best interest. For jewelry you might be able to obtain a lower rate on a floater policy if the item is rarely worn and typically stored in a safe deposit box or a home safe.

Like all insurance, before raising your home insurance liability limits for valuable items, or purchasing floater policy for additional coverage, it pays to take the time to shop around and compare insurance quotes for any changes or additions to your home insurance policy.