Is your Valentine's Day gift insured?

The saying “Diamonds are forever” may sound romantic when giving or receiving expensive jewelry for Valentine’s Day, but in reality, jewelry is just as vulnerable to theft and loss as any high-value item. That’s why it’s important to protect your investment by reviewing and updating your insurance coverage to make sure your treasured gifts are fully covered.

According to The National Retail Federation, consumers are expected to spend more than $29.1 billion overall on Valentine’s Day this year, including $7 billion on jewelry alone.

Standard homeowner’s policies typically include some coverage for the loss of personal possessions, including valuables like jewelry. However, if you’ve purchased or received jewelry or other items of special value such as cameras, musical instruments, expensive golf clubs, coins or fine arts, the included basic coverage for theft is limited and may not be enough on its own to cover your loss.

What’s covered

Most Homeowners Insurance policies cover jewelry for its full value when it’s damaged or destroyed by certain disasters, such as fire or windstorms. Theft coverage, however, is usually capped—often between $1,000 and $2,000 total for all jewelry in the household.

A Renters Insurance policies typically impose similar sub-limits, with overall coverage for lost, stolen, or damaged jewelry sometimes as low as $1,500, which may not come close to replacing an engagement ring or other fine jewelry.

While standard homeowners and renters policies place limits on items such as jewelry, high-end bicycles, golf clubs, and other valuable personal property, additional coverage is available to close those gaps.

Options for Additional Protection

Consumers can purchase special coverage, commonly called a Floater or Endorsement, to insure valuable items for their full value. This added protection typically has no deductible and covers a wider range of losses, including theft, accidental loss, or even losing a stone from a ring. It may also provide coverage for events like floods or earthquakes, which are not included in standard homeowners policies.

A floater or endorsement typically costs 1 to 2 percent of the value of your jewelry. If you have a $5,000 engagement ring, for example, it will cost approximately $50 to $100 a year to insure.

Appraisals Matter

Undervaluing your valuables may save a few dollars on insurance premiums, but it can cost you thousands if a loss occurs and your coverage falls short, forcing you to pay out of pocket to replace a stolen, lost, or damaged item.

When adding coverage for jewelry, insurers require a current, accurate appraisal for each item. Both your premium and the amount paid in the event of a claim are based on the appraised value you provide.

Experts recommend having jewelry inspected annually to ensure settings are secure and updating appraisals every two years. Updated appraisals should be submitted to your insurance company so coverage can be adjusted as values change.

NW Insurance Council recommends the following steps to help protect valuable jewelry for years to come:

• Contact your insurance company or agent to review how much coverage you have and whether additional protection is needed.
• Ask how adding a floater or endorsement affects your policy deductible.
• Examine jewelry regularly for loose stones or signs of wear.
• Have jewelry cleaned and inspected annually; many jewelers offer guarantees with regular checkups.
• Store valuable jewelry in a secure location, such as a safe or safe-deposit box.
• Keep a video, photographic, and written inventory of personal property, including receipts for high-value items. Many insurers offer mobile apps to simplify home inventory tracking.

To learn more about protecting your jewelry, visit NW Insurance Council or call (800) 664-4942.