Was Cupid good to you this Valentine’s Day? Did your spouse show how much they adore you with a beautiful and valuable gift? You probably can’t stop thinking about it, looking at it, or smiling about it, can you? Before too much time goes by, make sure you also protect your new gift with the right insurance coverage.
Here’s what you need to know.
Understand Your Current Insurance
Your personal belongings are automatically insured under your homeowners or renters insurance. However, your insurance will only cover up to a certain amount. High-value items, like jewelry, art, heirlooms, and other gifts may only have coverage of $1,000 to $5,000, depending on your policy. For some things, this is far less than the value of the item or what was paid for it.
You have two options for insuring your new gift: adding a rider onto your current insurance plan or purchasing a standalone policy.
Riders vs. New Insurance Policies
In many cases, all you need to do is to call your independent insurance agent to add a scheduled rider, floater, or endorsement to your homeowners policy. This will insure your gift based on its cost or current value. For items that appreciate in value over time such as art, antiques, or heirlooms, you’ll need to have the item appraised on a regular basis, typically every one to three years, depending on the insurance company’s requirements.
Some items, however, require their own standalone insurance policy. This includes engagement rings which may need a jewelry insurance policy. But other gifts like boats, motorcycles, ATVs, and automobiles also need their own insurance. If you buy an automobile as a gift and can’t simply add the new vehicle to your current auto insurance policy, you may need to “give” the gift at the dealership so insurance can be taken care of before they drive off the lot.
How to Insure Your Valuable Gift
The process to insure your new gift is simpler than you realize, but there are a couple of steps you don’t want to miss.
- Call your insurance agent to let them know you received a new gift (or before you buy a valuable gift). They can tell if you need a rider or a new policy.
- Ask whether you have replacement cost or actual cash value coverage. Replacement cost is better, in general, but especially for expensive gifts that lose value over time.
- Send your insurance agent a copy of your receipt to show what was paid for the item. Keep the original in your home inventory records. If no receipt is available, you’ll need to get it appraised.
- Photograph or video record your gift so you have picture/video proof of its condition and ownership.
The last thing you want to do is consider how you’ll keep your valuables secure. If this isn’t your first valuable gift, you may already have a system in place. But if not, it may be time to consider a security system for your home or a safe deposit box for small valuables you don’t use all the time.
If your Valentine was generous this year and gave you something lovely and expensive, contact Charlotte Insurance today so we can help you protect your new gift!