The holiday season is behind us and you probably received a few gifts. If any of these items were costly, you definitely want to revisit your insurance policy to ensure they’re covered. Here’s why.
Standard Policy
Your standard homeowner’s, condo, or renter’s insurance policy covers most household goods against the perils named in your policy. These perils are things such as fire, theft, vandalism, hail, smoke, and lightning. However, all insurance companies also limit the amount they’ll pay you for certain items.
Some companies offer higher limits than others and some offer optional coverages. However, understanding the limits of your policy is important, because if you don’t, you may end up paying out-of-pocket.
Policy Limits & Exclusions
Here’s an example. You popped the question and bought your fiancée an engagement ring. Someone breaks into your place and steals it. Your insurance policy stipulates that the insurance company will only pay $1,000, even though you have far more liability coverage.
You paid the average cost for an engagement ring in 2016 of $6,163. Since your policy limit is $1,000, you’re out $5,163. Ouch.
Item Limits
Insurance policies vary, so it’s important you understand your coverage. The following are common items that may require additional coverage, but it is not an all-inclusive list:
- Cash
- Prepaid Cards
- Gems & Semi-Precious Stones
- Securities
- Precious Metals – gold, silver, etc.
- Expensive Rugs
- Silver, gold, and platinum-ware or plated-ware
- Fine Art
- Antiques & Heirlooms
- Collectibles – Sports Memorabilia, Comic Books, Dolls, Figurines
- Collections – Stamp, Coin, etc.
- Furs
- Firearms
- Musical Instruments
- Computer Software & Hardware
- Bicycles & Sporting equipment
- Mobile Devices – cellphones, tablets, laptops,
- High-End Camera Equipment
The best way to protect these items is to add a rider to your homeowner’s, condo or renter’s insurance policy. “Scheduling” items normally requires a purchase receipt or a professional appraisal to determine the value of the item.
Benefits of Scheduling
While additional coverage is an added expense, it offers many benefits. First, you’ll have coverage for more risks, including accidental loss. If your fiancée takes off her expensive ring and knocks it down the drain, you’re covered.
Second, when you schedule items you usually do not need to pay a deductible for these items if you need to make a claim.
Lastly, since scheduling items you’ve owned for a while requires an appraisal, it is also an excellent way to establish current values. These items may increase or decrease in value through the years, and there’s no sense paying for more coverage than you need.
Policy Review
The Insurance Information Institute highly recommends you create a home inventory to accurately assess value. Of course, you’ll want to add your new stuff to the list.
As an independent insurance agent, we will review your policy and inventory and highlight any potential problems. We’ll look at discounts, life changes, and bundled options to combine coverage, simplify billing, and reduce your expense.
Don’t leave valuable items unprotected. Get the coverage you need.
