Welcome to the ABCs of Insurance Claims. Over the next few months, Sherri Walker, Sentinel’s Director of Claims will address an aspect of claims handling for every letter of the alphabet to help provide a better understanding of the claims process.
V is for Valuables
Most of us own valuables of some type, whether it’s a wedding ring, an heirloom piece of jewelry, Meemaw’s silverware, or some other high-end item. These can be difficult to replace in the event of a loss. While the sentimental value on these items may be immeasurable, the financial value can be definitive. Without taking a closer look however, they may not be properly covered just under your insurance policy. Today, we’re going to delve in to why you should consider scheduling your valuables.
Homeowners Policy Sublimits
Your Homeowners policy (which we’ve discussed previously) provides coverage for your Personal Property at a set amount; normally 70% of the value of your structure, or Coverage A amount. This is intended to provide coverage for the general “stuff” that most of us have in our home but does place sublimits on some items in the event of a theft loss.
These sublimits are placed on items that are likely targets for thieves, and typically run into a higher value than the rest of our belongings. The same can be true in varying commercial policies, for theft as well for other perils. While a Homeowners policy places limits on things like jewelry, silver, furs, cash, and guns, in most “Lords House” or church policies, similar limits are placed on theft of musical instruments and relics, as well as breakage for arts and stained glass. As such, to combat these sublimits, these items should be scheduled with a specified value in order to provide adequate coverage.
There are several ways to schedule items for proper coverage. These schedules can either be included as part of your Property policy, or placed on a standalone Inland Marine policy, depending on the carrier’s preference. In addition, individual items can be specifically named, or may be part of a blanket amount which encompasses a category.
Sometimes, these two methods can actually exist on the same policy. For example, if you have a considerable amount of jewelry with certain pieces more valuable than others, you could secure coverage which names the specific pieces you want to include at a stated amount and the rest can fall to a blanket limit. It is important to note that items under a blanket typically have a “per item limit” that applies. For instance, if you have a blanket limit of $40,000, no single piece of jewelry would be paid at more than that “per item limit” shown, which is usually set at $5,000.
In a commercial policy, there are often item “classes” that can be added – such as in that church example above, instead of listing every piano, guitar, and amp, there would be a named limit for all “Musical Instruments” that would be added to the policy.
When items are scheduled, often they are scheduled with no deductible. In addition, coverage can apply if there is loss to even a portion of the item. Imagine that you schedule a diamond anniversary band and one of the stones falls out. The replacement of that stone would typically be covered under the terms of the policy. When this happens, the carrier often has the option to replace the stone with a comparable one, or to pay the value of that piece and take ownership of the item. The same applies to a pair of diamond earrings – if one of the earrings is lost, the carrier may replace the missing one or pay the cost of the set and take ownership of the remaining earring.
When scheduling jewelry, an appraisal is often required based on the amount of coverage requested. It is important to note that unless you have an updated appraisal completed, the last appraised amount will be the most granted for coverage, Thus, you should consider having a re-appraisal done every so often due to cost fluctuations in items, especially gold and gems.
Safeguarding Your Success (and Your Valuables)
You are usually the best expert on your belongings, so it’s important that you have a discussion with your broker if you believe you have items that carry more value than your policy may currently cover. If you have a lot to lose, your Sentinel Account Team can review those important possessions to make sure that you’re properly insured. It’s all part of Safeguarding your Success (and your valuables)! Contact us today to learn more.