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Insuring Valuables
Have you taken the time to walk around your home and identify all of the valuables you have collected, inherited, or purchased over the years? You may be surprised if you take the time to do so, as most people do not realize the number of valuable items they possess.
You need to learn how to insure your valuables so that you can get made whole in case of a loss. This is particularly important because a typical Homeowners Insurance policy does not cover many valuables, and has limits on the dollar amount and type of loss that can be recovered. The protection provided for personal property under the typical homeowner’s policy is very broad, and includes coverage of furniture, clothing and appliances, as well as limited coverage for jewelry, silverware, furs, and firearms.
It may not, however, cover important types of loss, including a diamond ring falling out, a broken statue, or a flooded basement that ruins an expensive computer. It is essential that homeowners with high-value possessions purchase additional coverage to protect their valuable items in case of a catastrophic event, such as a fire or burglary. Most homeowners’ policies set dollar limits on the amount of protection offered to cover theft of items such as jewelry or furs.
It is wise for you to review your Homeowners policy annually to determine whether you have enough or too much coverage when you insure your valuables. In addition, when getting married, renovating, redecorating or when inheriting items from others, it is best to review your current coverage.
Some items that might require additional coverage are:
- Jewelry made of precious metals and gemstones
- Silverware (cutlery, teapots, trays, vases, etc.)
- Family heirlooms (furniture, paintings, etc.)
- Antique and hand-crafted furniture
- Hand-loomed rugs, carpets and tapestries
- Costly musical instruments
- Original paintings and works of art
- Signed prints by famous artists
- Antique china, crystal, cutlery, lamps, mirrors and other decorative items
- Designer appliances
- Furs
- Vintage wine collections
- Collectibles (stamps, books, glassware, etc.)
- Firearms
- Computers
Conducting a Home Inventory
The best way to save yourself a significant amount of money and agony over losing your valuables is by conducting a home inventory. This will aid you in knowing what was in your possession prior to a disaster. This will also provide proof of your belongings when filing a claim.
- Take photographs of every room in your home, from every angle. Zoom in to shelves to capture smaller items and open drawers to ensure that all of your belongings are captured.
- Photograph valuables separately against a white background. Avoid using a flash, as it can cause a glare and distort the details of the items.
- When photographing small valuables, place another common household item next to them as a size reference, such as a ruler or deck of cards.
- Take separate photographs of the serial numbers of your appliances.
- Place the images on a disc and store copies in a safety deposit box, in your home and at your office.
- Use a video camera to document the same details as you did with the photographs.
Travelers Insurance has a great website to show you exactly what you need to do!
Actual Cash Value vs Replacement Cost
When conducting your home inventory, you must also consider how the insurance company will calculate the amount to pay for your losses. Most homeowners prefer to have their belongings replaced for their replacement cost because they are compensated for the true cost of the item. In contrast, actual cash value (ACV) or market value, equals the replacement amount less depreciation. In other words, this is the amount you could expect to receive if you sold your belongings in an open market.
To protect your valuables that are not covered under your Homeowners Insurance policy, consider taking out an endorsement for all your items. An endorsement is an extension of your policy that broadens its limits to cover additional items that are of value. At times, when you insure your valuables, extremely high ticket items will require an additional policy, yet an endorsement is almost always an acceptable option. Generally, it is wise to insure items worth over $2,500 with a separate endorsement.
Minimizing Your Risks
Most thefts occur when valuables are left out in plain view or when guests are present in your home. Also, thieves may survey neighborhoods looking for signs that homeowners are away, such as uncut grass, newspapers left on the stoop or a dark house night after night.
- Keep doors and windows locked to your home and car while you are away, taking a nap or even mowing the grass.
- Replace door locks when first moving into a new home and change them periodically. If you must give a key to a maintenance worker or neighbor, give them a key to a non-ornamental lock, such as a back door.
- When going on vacation, make sure that your home looks as if the family has not gone away. Ask a friend or relative to collect your mail and newspaper or place a hold on these items at the post office. Also, ask that this person mow your grass or shovel your snow. Place lights on a timer in the evening to give the illusion that someone is home as well.
Contact TWFG Insurance Services if you have any questions concerning insuring your valuables or any other insurance questions 706-716-4160
