The holidays are over but you’re probably still enjoying the wonderful and thoughtful gifts you received. If any of those gifts were valuable — like art, jewelry, or even high-end electronics — it’s not enough to use them and love them. You may need to talk to your insurance agent to make sure you’ve got enough insurance coverage to protect them if they’re ever stolen or lost.
STANDARD HOME INSURANCE POLICY
When you purchased your homeowner’s insurance, you were given the option between replacement value or actual cash value. Replacement value means that your lost or stolen items are replaced at the amount they actually cost to buy again, up to your policy limits. No depreciation is factored into your payout. Actual cash value pays for the cost of your valuables minus any value it’s lost over time or depreciation. It may cost a little more per year or month but choosing a policy that pays the replacement value is better if you suffer a complete loss.
Once you receive a valuable item, it’s not just important to know if your policy is replacement or actual cash value. You also need to know what your policy limits are and what portion of the policy covers your valuables. Many policies only cover jewelry up to $1,500. Electronics, art, and even collectibles may have higher or lower limits. You can always increase your policy limits, but that might not be enough to truly cover your valuables.
BLANKET OR SCHEDULED RIDERS
To make sure your art, jewelry, electronics, and other gifts have enough coverage, it is often better to add a rider to your insurance policy specifically for your valuables. The amount of the rider depends on the value of your gifts and the type of coverage you choose.
Blanket coverage: Blanket coverage offers a set policy amount and any loss covered by your insurance policy will replace your valuables up to that total. This is a good option for electronics or if you only have one or two pieces of jewelry.
Scheduled coverage: To get more specific, you can choose scheduled coverage. In this policy, each valuable is included and listed with its value. This is good for jewelry, art, and some collectibles. You will need to have the items appraised to determine their value for the policy.
It’s important to check and update your homeowner’s insurance every year to adjust for changes you’ve made around your home and purchases you’ve been through the previous year. Right after the holidays is a perfect time so you can easily include any new valuable gifts into your policy. The last thing you want is double the pain from a theft – first the loss of the item and then insurance coverage that cannot fully cover your loss.
If you received valuable gifts over the holidays, or you’re ready to schedule an annual review of your insurance policy, contact us at Charlotte Insurance. We’re here to help.