Where’s the Necklace?

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No insurance professional ever wants a call from a client who has just lost an expensive piece of jewelry or some other expensive item that was not properly insured. The homeowner policy provides very little coverage for items such as jewelry, watches, furs, money, silver, guns, precious gems, and stamp and coin collections. One can, however, increase the sub limits in the policy or specifically insure the items with a special policy called a “Scheduled Floater” or “Valuable Items Floater”. The floaters are useful because they are “all risk” and there is no deductible to contend with. Most people think that the primary reason to insure a valuable item is for theft. There are many other things that can happen. A stone could fall out of a setting or a ring could slip off a finger or be accidentally flushed down the drain. Someone could spill a glass of wine while admiring your stamp collection or a child could decide to change the color of your mink. Some people schedule items that are not restricted on the homeowner policy such as cameras, musical instruments, and fine arts. Again, the appeal is that there is no deductible and the coverage is broad. Also, by placing a value on the item, you establish its worth up front so there is no dispute if there is a claim. We often advise our clients to consider not insuring valuable items that are inherited. The sentimental value can’t be replaced and since there is no monetary investment, paying a premium to protect them may not be worth it. Since many are using higher deductibles on their homeowner policies to save premium, the use of floaters for singular items of value makes even more sense. By having a scheduled floater, you can relax a little- knowing that if that Rolex you got for Christmas is missing, you will get another one without despair, tears, and regret.

The author of this blog, Guy Hatfield CPCU CIC, can be reached at 203.256.5660.

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