Friday, 8 January 2016

Insuring Your Jewellery

insurance

We spoke to our own insurer and gained some valuable insights to the rights and wrongs of insuring your jewellery.


Disclaimer – This information is general in nature and you should speak directly with your own insurer regarding the terms and conditions of your own policies. Where values are stated, these are the numbers used by our insurer, yours may be different.


General Insurance


Most household policies will provide some limited cover for jewellery that is not specifically listed on the policy. Unlisted items under $1000 may be covered in the home without requiring proof of purchase. There is usually a limit for all unlisted items on a policy, in our case it is $4000.


Items to be taken outside the home should be listed with your insurer as portable. Normally this would include the jewellery you wear daily.


Items that need to be listed individually


Any individual item of jewellery over $1000 in value should be listed with your insurer. You will also need to be able to provide a receipt in the event of a claim.


Items of $2500 and over will require a valuation in addition to the store receipt if you need to make a claim. The valuation must be performed by a registered valuer and should be recent. It is recommended that you have your valuations updated every year or two. This is also a good opportunity to have your jewellery checked for wear or damage that may need repairs.


Listed items over $1000 are typically covered as being portable.


Accidental Damage


It would also be wise to ensure that your jewellery is covered for accidental damage. This covers events where a total loss hasn’t occurred but the jewellery is unwearable. If your ‘waterproof’ watch is damaged by faulty seals etc. you could make a claim to have it repaired. Often accidental coverage will include portable cover so your jewellery would be covered outside of your home as well.


If you are travelling overseas, you should check the conditions of your policy for the coverage that is provided.


Jewellery Valuations


Legally, anyone can provide a jewellery valuation in Australia without being qualified or registered (talk about not worth the paper it’s written on). However, an insurance company will require a valuation provided by a registered valuer. The National Council of Jewellery Valuers will be able to provide you with the contact details for valuers in your area.


The valuation should be detailed including dimensions and weights and classifications of precious stones showing carat weight, clarity, etc.


How much should I insure it for?


Let’s say you bought a solid gold chain for $1500. The jeweller told you that you got a great deal and supplies you with a valuation for $2600.


The insurer at the time of paying a claim will pay up to the insured amount. Often they will source a replacement for you and not directly pay you any money.


You should insure it for the replacement value. So how much is that? If you know you can go back to the jeweller and buy the necklace again for $1500 tomorrow, then that is the replacement value. If you really got a great deal and couldn’t buy it again for less than $2600, then that is the replacement value.


Should you choose to insure your gold chain for $4000, you are likely to only be paying too much on your insurance premium. The insurer may well determine that the replacement value is only $1500, so you are paying for extra cover that will never be paid out in the event of a claim.


What about a new purchase?


If you were to buy a new diamond ring for $3000 and have it stolen as you are leaving the jewellery store, it is likely NOT to be covered by your insurer. You should contact your insurer to have new expensive items listed before you take possession of them. You wouldn’t drive away in your new car without insurance would you?


Biggest Insurance Mistakes


The most common (and costly) mistakes people make when insuring their jewellery are:


  • NOT having ‘portable’ insurance for items that leave the home.

  • NOT keeping documentation – receipts, valuations etc.

  • NOT having a valuation for items over $2500

  • NOT having accidental cover.

Record Keeping


You should keep in a safe place copies of invoices/receipts and valuations. Having photos of your items can also be an advantage both for the insurance and for the police to use in case of theft.


Many insurers now allow you to upload copies of these documents to their website. That will be to your advantage in the case of a claim.


In Summary


  • List valuable items on your policy and keep the receipt and have a valuation performed by a registered valuer.

  • Check where your jewellery is covered.

  • Consider accidental damage options.

  • Don’t over or under insure individual items.

 


Photo credit: free pictures of money via Foter.com / CC BY


 



Insuring Your Jewellery

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