Do I need special coverage for my engagement ring?

​If you have recently become engaged, I’m sure this is a happy time that you will remember all your life.  Perhaps the thought has crossed your mind while you are showing off your new ring to everyone, “What if this precious possession fell off my finger and I lost it?”
 
Given the value of most engagement rings, it’s important to make your ring is properly insured.  Yes, your ring could slip off your finger, or your diamond could fall out of the ring or your ring could even be stolen.  Your new ring is a financial asset worth protecting.
 
Unfortunately, Homeowners or Renters policies usually don’t automatically include sufficient coverage for most engagement rings.  An average policy will cover theft of jewelry up to $1500 or so and usually won’t cover accidental losing at all.  This is why it is a good idea to add specific coverage for your ring as “scheduled property”.  This is often a feature that you can on to your existing Homeowners or Renters policy.
 
When you schedule your ring, you are describing it on your policy, declaring its value and paying an additional premium based on how much it is worth.  While rates do vary from carrier to carrier, we often see scheduled jewelry run around 80 cents to a dollar per year, per hundred in value.  This means that a $5000 ring would cost $40-$50 per year to schedule and a $10,000 ring would command $80 to $100 in annual premium.
 
Usually your agent will ask you for an appraisal before your ring can be scheduled.  Beyond establishing a value, the appraisal also provides a detailed description of the jewelry for identification and/or replacement purposes.  If you have a receipt that includes a detailed description (including the 4 Cs of your diamond - cut, color, clarity, and carat), this may work in lieu of a separate appraisal document.  Depending on the carrier, an appraisal may not be required for lower valued rings but it is still usually a good idea because it documents what is being insured and what it is worth.
 
Scheduling your ring gives you far better coverage than you would have otherwise.  Your ring is fully covered up to its stated value and you have coverage for misplacing it or losing all or part of your ring.  Typically there is no deductible that applies.
 
Not all scheduled jewelry coverage is the same, however; so we recommend specifically asking for Agreed Value coverage.  If your jewelry is scheduled on an Agreed Value basis, you will be paid the full amount shown on your policy if your ring is lost or stolen.  Without Agreed Value and depending on your policy, you may be paid the lesser of the actual cash value, the estimated repair cost, the estimated replacement cost and the value shown on your policy.  Agreed Value might cost a little bit more but is well worth the extra premium.
 
While we usually recommend our client buy Agreed Value coverage whenever it is offered by the carrier, we rarely see it on other jewelry schedules people bring in for us to review.  So if you don’t specifically ask for Agreed Value, you are not likely to get it and you probably won’t be aware of the difference unless you actually have a loss.
 
One issue that sometimes comes up is who should schedule the ring – the bride or the groom?  Since property normally needs to be insured by whoever owns it, this comes down to a philosophical debate within the insurance industry as to whether an engagement ring is owned by the giver who purchased it or the receiver who possesses it.  I’ve seen different insurance companies come down on both sides of this debate, so the rules vary depending on your carrier.
 
If the two of you are both insured under the same Homeowners or Renters policy, this is a moot point, as you can add it to your joint coverage.  However, we often see cases where one party owns the home or has their name on the lease and has the insurance just in their name.  (This raises other coverage issues; see this post.)  Depending on your carrier’s rules, you may or may not be able to add the ring on to this existing policy.  If the other party does not have their own insurance and doesn't live with parents or other family, it’s possible a separate policy may have to be taken out to get the ring insured.  (However, we often have more flexibility for our clients since we represent multiple insurance carriers.)
 
If you have just become engaged, congratulations.  Enjoy this special time, and don’t forget to make sure your insurance keeps up with your recent life change.

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