By: Alan Mani
Welcome to this week’s “Coverage of the Week” blog where we discuss a particular coverage to educate and clarify a particular topic. This week’s topic…Valuable Articles Insurance. There are several insurance policies you can purchase to protect your valuables. I asked one of our Personal Lines Executives to help me gather as much information as I could. Hopefully the information below will benefit you.
First things first. Let’s address the myth that your jewelry, silvers, and collectibles are covered in your homeowner’s policy. There is a bit of truth to this myth because there are some basic protections for your valuable possessions, but the homeowners form has a cap. Generally, you will be limited to $2,500 to $5,000 for covered losses, and claims are subject to your deductible. This is where Valuable Articles Insurance comes into play.
So what is Valuable Articles Insurance? Basically, it’s when you “schedule” certain items such as jewelry, art, furs, silverware, stamps & coins, musical instruments, guns, cameras and collectibles. There is no deductible for this insurance, and exclusions that apply to your general contents will not apply under the valuable articles coverage. For example, your valuables would be covered for flood, dampness, loss by animals, earthquake, and mysterious disappearance – all generally excluded by your homeowner’s policy.
You have two options when you want to insure your valuables. Individually itemizing the valuables (scheduling) or placing them under a blanket. When you itemize your valuables, you are placing a specific value on each item and insuring it for that amount. For items of high value such as fine arts, gold, and silverware you need to get them reappraised every 3 to 4 years so that they can be insured to the correct amount since these items increase in value. When you place items under a blanket, you take your smaller valuable items and insure them for their total replacement costs. There is a limit to how much an individual item is awarded; typically it’s $10,000 per item.
Finally, you have the option of insuring items kept in a bank vault. The rates are much lower for these items, but any vault-stored item can be taken out no more than 3 times a year.
It may be time to make a list of all of your valuables and sit down with your insurance professional to discuss the value of each item, how much coverage you have for those items under your present homeowner’s policy and if that is sufficient, and if a Valuable Articles policy is the best way to protect those items in case of loss.