It might seem simple. You’ve just bought or have been given a lovely piece of jewellery. You need to insure it.
How do you do this and what should you think about?
This is usually the most cost-effective way to insure your jewellery. However, it is quite likely that your home insurance policy will have a low single article limit for valuable items, usually between £1,500 to £2,500. This means that if you have an item of jewellery worth more than this, in the event of a claim, the insurer will only pay up to the single article limit for any one particular item.
If you tell your insurer about the valuables you own that are more than the single article limit, they may be able to cover them as a ‘specified item’. But some insurers set a maximum claim limit for all valuables, for example, £5,000. So, if your jewellery is worth £10,000 and it was all stolen, you would only receive £5,000, and unless you have specified it, only up to whatever the single article limit is per item.
Mid and high net worth household insurance policies have sections within their policies specifically designed for the cover that jewellery warrants. They have higher single article limits and don’t usually have restrictions on the maximum amount you can claim for. Such policies are usually purchased through a specialist jewellery insurer broker.
In which case approach a private client insurance broker and see if you qualify for a wider household insurance policy which will include your jewellery items.
Or, opt for a stand-alone jewellery insurance policy.
You will need to have an up to date valuation, or purchase receipt as insurers will ask for this. Ideally, it should be no more than 3 years old and certainly no more than 5.
If your jewellery is lost or damaged, you need to be able to prove ownership and the full description and value of the item. Trying to establish these details once the item is lost is very difficult. By having the valuation at the outset means that when a loss occurs the claim can be more quickly and efficiently settled because it avoids any dispute over the insured value of the item.
Your jeweller or independent valuer will be able to help you ensure that the correct valuation is applied to your item of jewellery. This means it is insured for the correct value to get a replacement. The replacement valuation for an antique piece of jewellery will be different from the replacement value for a newly purchased piece of jewellery.
Insurers may require that you have an adequately rated safe for your jewellery. In some cases, they may also require that you have an intruder alarm. This will depend on the values at risk.
Safes have cash ratings. You multiply this cash rating by 10 to realise the valuables rating. A £10,000 cash rated safe can take up to £100,000 of jewellery.
If you keep your jewellery in a bank or safety deposit box you can expect to achieve some savings although there is a charge for keeping your jewellery in these facilities. There are not many banks that offer this service anymore and its not always convenient to your location.
Consider the amount you wear on a daily basis. Sometimes you can achieve a saving if you have your jewellery in your safe all the time and only have a set value out at any one time known as a ‘wearing limit’ or a ‘float’.
Under a typical high net worth policy, any new purchase you make is automatically covered as long as you tell your broker or insurer about the purchase within a set number of days, usually between 60 – 90 and pay any additional premium from the date acquired. Insurers cap this provision to around 25% of the jewellery currently insured under the policy. If you had a £200,000 collection, up to £50,000 would be automatically covered for a new purchase.
This is something worth checking if you have a specific relationship with an independent jeweller. Many insurers have a pre-selected panel of jewellers with whom they have negotiated more competitive rates for repair and replacement. Independent jewellers may not be on such panels. This can be a real issue when the jewellery item is an antique or been designed specifically for the client and replacement can’t be sourced from a pre-selected panel.
If you have any questions about jewellery insurance you can learn more here. Or you can get in touch with me by clicking the link below.