Protect Your Jewellery Against Insurance ‘Grey Zones’

If you don’t want surprises – make no assumptions.

An insurance ‘Grey Zone’ usually blindsides people when they make assumptions about what their home insurance policy covers when it comes to jewellery, coin and stamp collections. Everything boils down to making sure you’re ‘in the know’ and prioritizing coverage needs. It doesn’t need to be expensive; for example, a $10,000 wedding ring may be the one piece you want to schedule against loss or damage. It’s really quite simple, once you know the real risk and what you are willing to expose yourself to – you can make smarter decisions. It’s also important to note that unscheduled pieces are subject to your home insurance deductible – making claims for some items of lower value futile.

You may believe this isn’t a problem you would ever run into yourself, but take this Ontario woman’s experience as an example of what could happen. She didn’t realize until she lost her 20k engagement ring diamond that it wasn’t covered by insurance.

How much is your jewellery worth?

Most people have more jewellery than they realize. Between your Grandmother’s antique wedding ring, the pearl earrings from your anniversary, and numerous other small pieces you’ve collected over the years – the replacement costs add up fast.

While most homeowners assume that jewellery will be covered up to the limit of their policy, many home policies only cover jewellery up to a certain sub-limit. With multiple pieces, including family heirlooms (which are difficult or impossible to replace), it doesn’t take long to exceed that limit. The sub-limits can be even lower for collectibles, including stamps or coins.

You can read more about common home insurance misconceptions in this CBC article.

Jewellery is liquid cash for small-time thieves.

It’s one thing to have a diamond fall out of a weakened setting, lose a ring or damage a valuable watch – it’s a whole lot worse to have your jewellery, coin or stamp collection cleaned out during a break-in. Thieves love small valuable items they can turn over for a quick buck – so that’s what they look for first.

Only 4% of lost or stolen jewellery is recovered.

With 1 in every 235 insured homes reporting a break-in each year, your exposure to a huge potential loss is high for anyone with inadequate coverage. Even if you had adequate coverage 5-10 years ago, the rising value of gold, platinum and various gemstones has left many unknowingly underinsured.

Steps to Protect and Properly Insure Your Jewellery

1. Check your current policy limits.

Within your current policy, look up your sub-limits (that’s all the insurer will pay in the event of a loss unless you get additional coverage). For jewellery, it’s typically $6,000 with a standard policy and $10,000 or more with high-value home insurance (Guarantee, Chubb, Acce or Aviva Dolce vita). In either case, your deductible applies, limiting your recovery.

2. Check your specific coverage.

Most homeowners, condo or tenants insurance policies only have limited coverage for jewellery, coins or stamp collections. That means if you only have a basic policy, you may not have coverage for jewellery that the insurance company deems to be “lost.” Mysterious disappearance is a term often used by the insurance industry to describe a claim for lost jewellery, diamonds or gems from a piece of jewellery. The disappearance of the item might not actually be a mystery – the insured person might know exactly where the item was lost – but it might be irretrievable. If for example, you lose your wedding ring while swimming in a lake. You’d have a pretty good idea of where the ring was, but no way to recover it. It pays to know ahead of time whether you’re covered in this type of situation.

3. Schedule items of significant value.

Scheduling, or a jewellery floater, is the best way to protect yourself if you have one or more high-value pieces. It allows you to list one or more specific pieces directly on your policy at the value appraised and indicated on the floater. This can also be called a rider and is an endorsement attached to an insurance policy to add coverage for the specific item.

One advantage of scheduling an item is that no deductible applies if you have to put in a claim. However, scheduling comes the responsibility to track the value of the piece in case of fluctuation. While your broker should ask if you’ve had any fluctuations or bought new valuables during a renewal meeting, these items will not be updated automatically on an annual basis, unlike other home insurance coverages.

4. How can I get coverage for all my jewellery?

Blanket coverage is useful if you have a collection of less expensive pieces, not just one knock-out. You set a coverage amount, say $25,000 for the entire collection, and don’t need to estimate the value of each item. However, blanket coverage can also be subject to both sub-limits and deductibles. For specifics, make sure to consult with an insurance broker.

5. How much jewellery coverage do I need?

The easiest way to answer this is to get an appraisal. If you’ve had a piece for more than three years, an appraisal from a professional can give you a concrete indication of how to properly value the piece. The value of jewellery depends on several factors: condition, age, colour and clarity of stones, style, provenance (where it was bought) and the purity of the metals used, e.g. 10-karat, 12-karat, 18-karat, or 24-karat gold. Make sure to seek out an independent appraiser, so they won’t low ball the value in an attempt to buy the piece for under market value.

6. How can I prove my jewellery’s value in the event of a claim?

The easiest way to keep track of value is to create and keep an inventory of your jewellery. This should include a photo of the item, the date you got the piece, how much it cost, and where you got it. Additionally, include the market value if you’ve had the piece appraised. Keep all of your receipts and staple them to a photograph of the item. Keep a copy of the inventory on your computer and in your safe deposit box. In the event of a loss, this will be important in establishing the item’s value.

7. How can I keep my jewellery safe?

The best solution is to have your jewellery properly insured and maintain proper appraisals, receipts and photos. Extremely high-value pieces should be kept in a safe or safe deposit box. If you have heirloom pieces you only wear on occasion this is a good option.

Another way to protect against theft is a home security system – plus, you’ll likely get a discount on your homeowner’s insurance that will cover a portion of the annual service fees. Some collectors have in-ground vaults, camera systems, and screen household help to prevent hiring past thieves. Of these options, the most cost-effective deterrent is often a camera system which can make thieves view your home as too risky to target.

8. How can I protect my jewellery from loss?

When considering jewellery, many people forget that items can be lost as easily as stolen. A simple protective measure for rings with gems is regularly checking the setting to see if it’s loose. It’s much less expensive to have a piece repaired than to replace a lost diamond. This also applies to clasps on necklaces and bracelets.

Additionally, if you’re planning on doing manual tasks, entering a pool, spa, or lake, or even just exercising – all situations where jewellery might become damaged – consider removing the jewellery beforehand. Rushing to do the dishes certainly doesn’t warrant a diamond down the sink. That said, if you are properly insured, you’re likely covered.

The easiest way to prioritize your jewellery insurance.

The easiest way to protect and prioritize your jewellery against loss is to a) know what you have and b) know exactly what you’re covered against. A good rule of thumb is to go through the jewellery you have, create a list and estimate the total value. Once you have your inventory completed, reach out to one of our Excalibur Insurance Brokers, and they can guide you through specific options and help you find the coverage that best fits your needs.

How much does it cost to schedule a piece of jewellery?

To get a specific quote, talk to one of our Excalibur Insurance Brokers. However, as a general rule, expect to pay an annual rate of $1 to $2 for every $100 your ring is worth. The average $6,000 engagement ring, for example, would cost between $60 and $120 per year to insure.

Let us help.

We work hard to make sure you have the right jewellery insurance coverage. We go above and beyond to find you the best insurance rates, but only after we have asked you the right questions and given you the advice to make smarter decisions. Speak to one of our Excalibur Defenders today and let us help you lower your insurance rates.