Personal Valuables insurance separately insures possessions of higher monetary value, such as a diamond engagement ring, your grandfather's pocket watch, artwork or a valuable collection. While most homeowners policies have limits on the dollar amount and type of loss that can be recovered, Personal Valuables coverage will provide the protection you need for your most valuable possessions in the event of loss through theft, accident or natural disaster. Under a Personal Valuables policy, you schedule (separately list) each item to be insured and provide a dollar-value for each item. Items are typically covered at replacement cost value; however, there are times when agreed value can be secured.
There is a widespread misconception that the Personal Property coverage part under the homeowners policy covers any type of item up to the policy limit if it is damaged by a covered peril. Unfortunately, this is simply not the case and can prove to be a very costly mistake for many consumers. Homeowners policies categorize certain items under a “class.” For instance, jewelry is a class, just like china, musical instruments, stamp collections, fine art, furs and the like fall under their own respective class.
Your homeowners policy will set a “class limit” for each specified class, which represents the maximum amount the insurance carrier will pay – not per item – but in total. While it varies slightly by insurance carrier, the average class limit for jewelry is $2,000. Similar limits as this apply to the other classes. So in a situation where, for instance, your house is a total loss due to fire (a covered peril) and your $50,000 jewelry collection is subsequently lost, your insurance carrier will only pay the maximum limit of $2,000. In this example, you self-insured the $48,000 difference – a costly mistake. This is where the benefits of implementing a personal valuables policy can prove to be extremely beneficial.
To learn more about our Personal Valuables insurance products, speak with one of our experienced professionals today.