Imagine enjoying a beautiful day in the city with your family only to discover upon returning home that a valuable bracelet that you wore is missing, lost somewhere in your day’s adventures. There is a sentimental loss, of course, but the personal property coverage on your homeowner’s insurance should cover the financial loss, right?
Many homeowner’s policies have limitations on personal property such as jewelry, firearms, instruments, collectibles, and fine art. If the loss doesn’t exceed the deductible (often higher on a homeowner’s policy in an effort to reduce premiums) it may not be covered at all. In other words, a claim on your bracelet that is valued at $400 might not be paid if your deductible on the policy is $500. And even if it is covered, it might be subject to depreciation. For example, if a five-year-old camera that cost $1,000 new is broken on your day trip, it might be depreciated to $700, making your reimbursement only $200 after the $500 deductible. You would be paying a significant amount out of pocket to replace that loss.
So, what do you do? Lock up your valuables and never let them see the light of day? Sacrifice using and enjoying them in an effort to keep them safe?
There are other options.
Scheduled Personal Property
One way to make sure you have coverage for these valuable items is to schedule them on your policy with either Replacement Cost Coverage or Agreed Value Coverage. Scheduled items often even bypass the deductible on your regular policy.
Replacement Cost Coverage indicates that the policy may pay to repair or replace damaged or lost property, without considering any depreciation of the item. Agreed Value Coverage means that you would list an agreed value for the item you’re insuring and that would be the amount paid in case of a loss. Providing an appraisal or bill of sale will help determine the proper value to schedule.
You might also be able to blanket some personal property, giving additional flexibility when making a claim for insured property.
Determining Valued Property
Consider the items you wouldn’t pack in a moving van…the ones you would deem valuable enough to carry on to a plane. These are often the items that need to be scheduled. If they are significantly more valuable, such as collections of jewelry or art, separate insurance may be preferable.
Talking with your Compass Insurance Partners professional will also help you determine which items need to be individually scheduled and which type of coverage is to your greatest advantage.
So, wear the bracelet…take the camera…display the art…USE those special things! Have the confidence that, should you sustain a loss, you’re covered.