Love May Be Priceless, But Valentine’s Day Gifts Can be Costly, Says I.I.I.

If receiving an engagement ring or other piece of expensive jewelry on Valentine’s Day, make sure to have the necessary insurance, advises the Insurance Information Institute (I.I.I.).

Standard homeowners and renters insurance policies include coverage for personal items such as jewelry. However, many policies limit the dollar amount for theft of valuable personal possessions such as jewelry, furs, and precious stones from $1,000 to $2,000.

“To properly insure jewelry and other expensive items, consider purchasing additional coverage through a floater or an endorsement,” said Jeanne Salvatore, the I.I.I.’s vice president of Consumer Affairs.

In most cases, individuals would also be covered for “mysterious disappearance.” This means that if one’s ring falls off their finger or is lost, they would be financially protected. With floaters and endorsements, there are no deductibles and frequently individuals will get the option of having the insurance company replace the item for them, according to Salvatore.

Floaters and endorsements are available as additions to home and renters insurance policies. Some companies also offer a stand-alone policy to cover jewelry without having to purchase home or renters policies.

“While there is no way to insure the sentimental value of jewelry, having it properly insured will provide financial protection in the event it is lost or stolen,” said Salvatore.

To make sure one’s jewelry is adequately protected, the I.I.I. suggests:

Contact one’s insurance professional immediately
Let an agent or company representative know that one is now in possession of an expensive piece of jewelry. Find out how much coverage one has and if additional insurance is needed.

Have the item appraised
Heirlooms and items that were purchased several years ago will need to be appraised for their dollar value. Ask one’s insurer for recommendations regarding a reputable appraiser. It is important that expensive items are appraised properly. If purchasing a floater or endorsement, individuals will pay premium based on the appraised value and in the event of a claim, be compensated for this dollar amount.

Keep a copy of the store receipt
Individuals will need to forward a copy of the receipt to their insurer so that the company knows the current retail value of the item. Keep a copy and include it with one’s home inventory.

Store valuables in a secure location
Protect one’s jewelry by storing it in a secure location in the home. If not planning to wear the item regularly or are holding it for a child, consider keeping it in a safe deposit box. One may save money on the cost of insuring it, as some companies offer “in vault” coverage. If wanting to wear the jewelry for a special occasion, many insurers will offer the option of purchasing additional coverage for the time it is out of the bank. Individuals would, of course, have to notify their insurer ahead of time.

Update the value of one’s jewelry
Expensive items can go up or go down in value. Talk to one’s insurance professional about how to make sure the dollar amount of the floater or endorsement reflects these changes. Prices for floaters and endorsements will vary depending on the type of jewelry, the insurance company they choose, where they live and where the item will be kept.

Take a picture of the item or collection
Get into the habit of keeping a visual record of all of one’s personal possessions. This helps to document one’s loss and speed up the claims process. It is also useful to document antique and unusual pieces of jewelry.

Add the item to one’s home inventory
Everyone should have an up-to-date inventory of their personal possessions. This can help purchase the correct amount of insurance and speed up the claims process when there is a loss. To make creating a home inventory fun and simple, the I.I.I. created free, downloadable software located on www.knowyourstuff.com. One can add a digital photograph of their new gift and save scanned receipts. Computerizing one’s inventory also makes updating it faster and easier.