by Trevor Juntunen

Created on: August 05, 2009

A typical homeowners or renters policy covers only a small amount of jewelry automatically. The value is usually limited to a range of $1,000 - $2,500, depending on the company you have your policy with. For many people this might be adequate, but if you have an $8,000 wedding ring, it is only a drop in the bucket.

Insurance companies set limits on the value of items to prevent fraudulent claims. Money, silverware, jewelry and firearms are commonly capped at a set amount. History has proven that a few will take advantage of the system. A theft report could state that thousands of dollars worth of cash that was under the mattress was taken or that inherited jewelry and silverware were gone. Without there every having been receipts of purchase, all the insurance companies could do was argue over values. Because of claims like these, limits were set, and everybody was tarred with the same brush.

Fortunately, there is a method of insuring items that have values greater than the policy limits. This is known as scheduling, or purchasing a rider endorsement. With proof of purchase or an appraisal with pictures, you can have a piece of jewelry scheduled onto a homeowners, renters or condo-owners policy. There is a set cost per hundred dollars in value for the item, the cost of which varies by company.

In order to encourage more people to schedule on jewelry, insurance companies commonly give two extra forms of coverage not normally available. The first is the pair-set clause and the second is mysterious disappearance.

The pair-set clause is handy when insuring items such as earrings. If one of the set of earrings is stolen or destroyed by a covered peril, it allow for the replacement of the set, not just replacement of the missing one. This is important when dealing with unique matched sets, as a replacement for one cannot be found, causing the pair to become mismatched.

Mysterious disappearance coverage is an interesting coverage. Normally, if a piece of jewelry is lost, a police report would be required to substantiate a theft. But what happens if the item was lost and it was obviously not stolen? Probably one of the most common occurrences is while washing dishes. You forget to remove your wedding ring and later on notice that it is not on your hand. Low and behold, it had gone down the garbage disposal. Usually, there is no coverage for this, but the mysterious disappearance clause has been known to pay for this. One thing to always remember though, if you later find the piece of jewelry that was paid for with this coverage, it is owned by the insurance company. By paying the claim, they essentially bought it. You will either be given the opportunity to buy it back for the amount paid by the claim or you will have to turn it over to the company.

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