Recently, clients I hadn’t seen since 2005 came into my office. It was so great to see them and I couldn’t believe that it had been so long; but their 7 year old son and 5 year old daughter were undeniable proof. After we caught up and I was introduced to the new additions to the family, we got down to the true reason for their visit. Unfortunately, their home was broken into and their bridal set stolen. I quickly asked if they had insurance and they assured me they did. We all breathed a sigh of relief, that is, until I noticed they hadn’t updated their appraisals nor had annual checkups since I last saw them. The rings were covered but under-insured. With the insurance check, it would cost them an additional $12,000 to replace what they had. They told me they had meant to come in but something always came up.
There are three simple questions to ask yourself to ensure this doesn’t happen to you.
1) Does my jewelry have an up-to-date appraisal?
According to Chubb Personal Insurance, because of rapid growth of luxury markets, unprecedented jewelry auction sales, rising production costs, and robust online sales, the average consumer has outdated appraisals that extremely undervalue the true replacement cost of their jewelry by as much as 50%
Solution: If your jewelry appraisals are over 5 years old, it’s time to get them updated – NOW.
2) Have I purchased any new jewelry in the last five years that hasn’t been added to my policy yet?
Remember standard homeowners policies for jewelry range only from $1000-$5000, plus a deductible. If it’s not scheduled, it may not be covered.
Solution: Get either itemized coverage or blanket coverage. Check with your agent to decide which option is best for you. It has been my experience that the downside of blanket coverage is that there are typically limits placed on individual pieces and at times there may be a deductible.
3) When was the last time I had my jewelry inspected for loose stones or structural damage?
Most people wait for something to break before they consider taking their jewelry in for help, but this is inadvisable.
Solution: Like with our bodies, preventative maintenance is of key importance. Take the time to have your jewelry checked once a year. In an annual checkup, any loose stones, pulled prongs, warped shanks, or scratches are detected and fixed. Studies show that those people who regularly take their jewelry for annual checkups are 4x less likely to lose a major stone.
by Fred Cuellar, author of the best-selling book “How to Buy a Diamond.” More questions? Ask The Diamond Guy?