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Protect Your Precious Pieces: Essential Guide to Jewelry Insurance

One of the aspects of organizing your life may include protecting things that have both monetary and sentimental value.  This can include insuring your valuable jewelry.  This type of protection becomes more valuable than you can imagine when you suddenly need it.

Why Should You Buy Jewelry Insurance?

A clean, elegant desk with a clipboard with jewelry insurance on it.

Just as we commonly insure other expensive purchases, jewelry insurance makes sense because some pieces, like an engagement or wedding ring, are worn every day.  Jewelry is often exposed to a lot of wear and tear, which can loosen valuable stones. But it is also something small enough that it can easily be lost when taken off briefly to wash your hands or play sports.

Preparing yourself for the worst is part of organizing your life. Being responsible helps bring peace of mind. While I’ve discussed organizing and securing jewelry, it’s also important we’ve taken steps to prepare for the worst.

Accidents Happen

Granted, most people take precautions to take good care of their valuable jewelry, but unexpectd things can happen and you may not want to take any chances. I’ve seen the most diligent, responsible people experience scares with their wedding ring, making them better understand the value of insurance.

Diamonds themselves are very strong, but they can become loose in their setting from wear and tear. Rings and bracelets also develop loose stones if they are accidentally knocked against a hard object, for example if you bump your ring against the counter top, a table or another surface. If you don’t realize stones are loose they may be dislodged and lost.

If you go swimming in a lake while wearing a ring your fingers can contract from the cool water and the ring can easily slip off without you realizing it until it is too late. And we’ve all seen the shows where the wedding ring fell into the sink or toilet. Unfortunately unexpected things like this really do happen all the time so it is important to have insurance to protect valuable jewelry.

Homeowner’s Coverage Is Limited

Some people rely on their homeowner’s policy to insure jewelry instead of specifically purchasing jewelry insurance. If you have homeowner’s or renter’s insurance you will have some coverage, but it may not cover loss or damage in all situations and the limits are much lower.

Generally under a homeowner’s policy all of your jewelry and certain other valuables have a combined limited coverage between $1,000 to $2,000. If this isn’t enough coverage, it’s worth considering a separate policy for your valuable jewelry. Another option is to add rider insurance or a floater, to better cover specific pieces of jewelry.

How Much Will It Cost?

The cost of insuring jewelry will vary based on a few different factors. For starters premiums can vary from state to state and certain geographical areas that have a higher crime rate may charge a little more. Different insurance companies serving your area may charge different rates so it pays to do some comparison shopping. Of course the value of your jewelry will also be a factor; the Gemological Institute of America can provide information about diamond and other gem grading. But generally speaking rates will be quoted per $100 worth of coverage; it will usually be $1 or $2 per $100, or 1%-2% of the value of the ring.

You may be able to include additional coverage to your homeowner’s policy under an extension called a rider or a floater; some call it ring rider insurance or jewelry rider insurance. But before you do this do some comparison shopping to make sure this option offers the best coverage for you.

You may be better off taking out a separate policy. You may be able to get a discount by going through the same company you use to insure your home and car. If not you may want to go to a company that specifically specializes in jewelry insurance like Chubb or Jeweler’s Mutual.

Finding The Best Policy

Make sure you understand the coverage you will be getting before you commit to anything. Purchasing a policy only to find out later it doesn’t cover what you thought it did can be very frustrating, and it does happen, so make sure you understand the policy before you make a commitment.

Here are some questions you should ask when you compare jewelry insurance policies:

  • Does the policy cover theft, loss and damage?
  • If it covers damage are there exclusions, for example if your diamond ring was damaged wearing it while playing sports?
  • If the policy covers repairs are you required to go to a specified jeweler?
  • How will the jewelry be replaced? Will you receive a check or do you need to find a replacement at a specified jeweler?
  • How much will the policy cover?
  • Is there a deductible?
  • Will the jewelry be covered if it is damaged, lost or stolen while in the possession of someone else (at the jewelers for a cleaning)?

Insurance policies can vary. Make sure you have the coverage you want and that you know the details of your policy so you aren’t unpleasantly surprised if you suddenly need to file a claim. Some policies will offer a cash settlement so you can replace the ring, but others only offer repair or replacement. Be sure you know what to expect in the event of a settlement.

Protect The Family Jewels

It’s also important to understand how they will pay a cash settlement. If they pay based on actual cash value (ACV) you should know that this value can change over time based on the changing market value of diamonds, gold and silver at the time of loss. For this reason it is good to have your ring appraised about every 5 years or even every 2 years if commodities like gold and silver are volatile.

The Forms You’ll Need

When you go to buy a policy, there are a few forms you will need. You will need to give your agent a copy of both the sales receipt and the appraisal. The jewelry appraisal should have a detailed description of the jewelry and pictures. If the appraisal doesn’t have pictures, be sure to get your own clear pictures to provide to your agent as well. You may need a copy of any diamond or gem certificate also.

Finding A Qualified Jewelry Appraiser

Get a professional appraisal by a qualified appraiser; don’t just pick the person who gives you the lowest quote and don’t simply look at this as a necessity for insurance purposes. It is important to get an accurate, detailed appraisal.  You’ll be glad you did if you ever need to file a claim.  Also, a proper appraisal could save you on insurance premiums.

To find a qualified jewelry appraiser there are a few questions you can ask:

  • Is the appraiser a Graduate Gemologist (GG) or a Fellow of The Gemological Institute of Great Britain (FGA)? In the field of gems sciences these credentials are educational requirements teaching how to identify and grade colored stones and diamonds.
  • Is the appraiser recognized by an appraisal organization like the American Society of Appraisers (ASA), National Association of Gem and Jewelry Appraisers (NGJA) or the International Society of Appraisers (ISA)?
  • Will they provide references? It’s great if you can get references from professionals like attorneys, banks, or trust companies that have used them.
  • Do they attend continuing education classes and how much per year? How often do they have to take a requalification course or exam? You want to make sure they keep up to date on market trends.
  • What are their specialties?
  • How do they charge for their services? They should charge by a piece rate based on the complexity or an hourly rate not by a percentage of the appraisal value.
  • You should also ask for a copy of their professional profile which lists the experience and history of education.

Your insurance company may also give you a list of jewelry appraisers they often work with.  They may want you to use someone who has completed the Certified Insurance Appraiser program.

Getting Regular Jewelry Appraisals

Due to changing markets, the value of your jewelry can also change over time. Because of this it is good to get a jewelry appraisal every few years for your valuable jewelry, and be sure to update your insurance company when you get a new appraisal so they can adjust your insurance rates accordingly. Some insurance policies may even require an appraisal every few years. Once you have an appraiser you trust, getting regular appraisals should be pretty easy. 

When shopping for jewelry insurance be sure to compare rates and policy details from different companies to find the best fit and the best price for your needs.  Also, make sure you think through how it will work if you ever have a settlement claim. Don’t make the mistake of quickly glancing over the fine print, and don’t simply think in terms of keeping the process simple and inexpensive up front. In the long run this attitude could cost you time, money and stress. When done thoughtfully, this type of protection can bring peace of mind.