Insuring Valuables

Most Homeowners Insurance policies have stringent limits on coverage of valuables:

• As little as $1,000 of jewelry
• Up to $2,000 on firearms
• Up to $2,500 on silverware
• May not cover through theft, accidents, or natural disaster

A valuable items endorsements provides higher limits (as high as $50,000), which is enough for many homeowners. Others require separate policies for sufficient coverage.

Items that may require additional coverage:

• Jewelry
• Silverware
• Heirlooms (furniture, paintings, etc.)
• Rugs
• Musical Instruments
• Fine art
• Antique china, crystal, decorative items
• Designer appliances
• Furs
• Vintage wine
• Collectibles (stamps, coins, glassware, etc.)
• Firearms
• Computers

Conducting a Home Inventory

• Take detailed photos of every room in your home.
• Photograph valuables against a white background.
• Place a common household item next to valuables as a size reference.
• Take photos of the serial numbers of your appliances.
• Store digital copies in a safety deposit box, in your home and at your office.
• Use video to document the same details.

Complete a home inventory checklist, itemizing all possessions. Be sure to include the following:

• Item description
• Date purchased
• Quantity
• Current Value
• Purchase Price
• Retailer's Location

Actual Cash Value vs. Replacement Cost

Actual cash value (ACV) is the value of property minus depreciation:

• Depreciation determined based on various criteria, accounting for wear and age of the item.
• Insurance company pays depreciated value.

Replacement cost is the value of property as if new:

• Item replaced based on value of other property that is made of comparable materials and is used for similar purposes.

Keep in mind:

• Replacement cost allows you to replace the cost of yesterday's purchases at today's prices (less deductible).
• The ACV pays significantly less for your damaged or stolen valuables.
• You must have proof of your belongings (checklist, photos, videos).

Insurance Options

• Take out a valuable items endorsements for furs, antiques, and jewelry.
• Provides coverage for many types of losses, except nuclear explosion, war and intentional destruction.
• Take out a blanket endorsement for collections in which no one item is worth more than $2,500.
• Covers the entire collection at one agreed-upon amount.
• Endorsements typically have a lower deductible than your Homeowners Insurance policy.
• Endorsements generally include "mysterious disappearance" coverage - covers losses when the cause is unknown.
• Keep a keen eye on the value of items and collections. Since they fluctuate in value, adjust your coverage accordingly.

Things to consider:

• Limits on a policy covering breakable items such as china and statuses should also cover breakage.
• When having high-ticket items appraised, use specialized appraisers.
• Example: An appraiser specializing in rare sports memorabilia should appraise a baseball card collection.
• Your jewelry policy should cover replacements with similar quality and type of items.
• Installing a security system may qualify you for a discount.

Homeowners Policy:

• Limited coverage on dollar amount and type of loss that can be recovered.

Valuable Items Endorsement:

• Enhances coverage by providing higher limits and expanded protection for special property.

Valuable Items Policy:

• Essential for coverage of extremely valuable items, such as a ring valued at > $10,000 or a collection of fine arts valued at > $50,000.
  • Higher limits of coverage
  • Covers more perils
  • Provides worldwide coverage
  • Can be expanded to provide loss due to breakage

Floater:

• Covers one specific item that is easily movable. Can be an endorsement or separate policy.

Newly Acquired Property

• Many policies insure up to 25 percent of total scheduled insurance for up to 30 days from date of purchase.
• For fine arts, you may have up to 90 days to notify agent.
• You need not notify your agent the moment you buy a valuable item.
• However, avoid delay - automatic coverage lasts for a limited time!

Insuring Antiques

• Have all antiques appraised.
• Keep inventory, copy of recent appraisal, measurements and photos in a safety deposit box.
• Hire a specialized appraiser with experience looking at items similar to yours.
• If you plan to take your antiques to shows, consider a floater policy and worldwide all-risk coverage.
• Notify your insurance company when you purchase a new item so it can be added to the policy.

Insuring Art

• Insure your art for as much as possible.
• Hire an independent art appraiser who can provide you with a statement of value.
• If you have sales receipts and authenticity information, keep them in a safety deposit box.
• Have your artwork reappraised periodically and adjust coverage as necesseary.
• Minimize your risk of losing several pieces of art at once by placing them in different locations (vacation home, office, primary residence).

Insuring Jewelry

• Have all jewelry appraised in store or by an independent appraiser. Have each piece listed separately with its value.
• Review your homeowners insurance policy to determine whether the value of your items exceeds policy limits.
• Store your most valuable jewels in a fore-proof safe or safety deposit box.
• Have jewelry inspected and reappraised frequently and update coverage accordingly.

Insuring Collectibles

• Homeowners insurance policies have limited coverage of collections - determine whether an endorsement/separate policy is warranted.
• Have collection appraised every 3-5 years and adjust coverage.
• List collection items separately on your policy.
• Assign each collection item a number for periodic inventories.

Insuring Family Heirlooms

• Make a list of family heirlooms that necessitate additional coverage.
• You may wish to split the cost of the policy with family members.
• To determine the current market value of replaceable heirlooms (furniture and china), use an antique pricing guide or consult an appraiser.
• Make copies of appraisal documents for family members your insurance company.
• Photograph heirlooms from various angles to establish their condition.
• Purchase a floating insurance policy (a "floater) if you have an heirloom that moves between family members or if you travel with the item.
• Each item requires a separate floater.

Insuring Electronic Equipment

• Increase your homeowners insurance policy to cover expensive electronics.
• To document how much you paid, keep receipts from electronics purchases in a safety deposit box.
• Purchase a computer insurance policy for your college student.
• Ask your insurance company about damage to a laptop.
• Do not leave electronic equipment in plain view.
• Consider installing a security system for added protection.

Minimizing Your Risks

Consider these precautions to minimize the risk of theft:

• Always keeps doors and windows locked to your home and car.
• Replace door locks periodically.
• When out of town, make your home appear lived in.
  • Place a hold on mail/newspaper at the post office.
  • Also, ask someone to mow grass or shovel snow.
  • Place lights on a timer in the evening.
• Put valuable items (jewelry, electronics, collectibles) in your carry-on instead of your suitcase when traveling.
• If you must remove jewelry when outside of the home, keep it in a secure place.
• Store valuable items out of sight when you invite guests into your home.

Ensure that your valuables are properly insured.