As families hit the road for vacations, they often bring along expensive jewelry and camera equipment, putting those items at risk of being damaged or stolen. Homeowners insurance may step in if something goes wrong -- or maybe not.
What many people don't realize is that a basic homeowners, condo or renters policy may not do the job for valuable items such as jewelry, furs, antiques, sporting and computer equipment or rare collections because most policies have limits.
For example, most basic homeowners policies only cover up to $1,000 for jewelry, $2,500 for silverware and $2,500 for firearms. If a possession is worth more than the basic homeowner policy limits, extra policies are needed to protect it up to its appraised value.
"When people realize they should have had more coverage, it's usually too late," said Dave Phillips, a spokesman for State Farm Insurance Co. in Concordville, Delaware County. "Many losses, especially jewelry, usually occur during vacation or post-honeymoon."
While it takes a little more effort to "schedule" individual items -- getting a written appraisal on each item and submitting the appraisals to the insurance company -- the advantages far outweigh the hassle if the insured ever needs to file a claim. Once personal possessions are scheduled on a homeowners policy, nearly all causes of loss are covered.
Basic policies cover only specified causes such as fire, windstorm and theft. That means if a diamond falls out of a ring and is lost, the insurance company most likely will not pay to replace it unless the ring was scheduled.
Also, there is no deductible on scheduled items. If the insured item is either stolen, destroyed or lost, the insurance company will release the full payout. Some insurance companies will pay cash for the policy amount. Other carriers will replace the item up to the amount of the coverage.
"If you have even one or two items that you would want to have replaced if they were stolen, lost or damaged, it's probably worth having them appraised and have them scheduled on your homeowners insurance policy," said Janet Scott-Buckley, a manager at Harrington Insurance Agency in North Andover, Mass.
She said while the extra insurance is relatively inexpensive, the cost varies by the kind of item. Scheduled jewelry typically costs about $12.50 per $1,000 of appraised value. So, the annual premium to protect a $10,000 engagement ring would run about $125.
Other items that are commonly scheduled on insurance policies are musical instruments, golf equipment and fine art such as oriental rugs and paintings. Engagement rings, Ms. Scott-Buckley said, tend to be among the most popular items.
"People do schedule firearms, especially hunters and avid sportsmen," Mr. Phillips said, adding that the summer months are usually when State Farm sees a spike in claims for losses of personal items due to vacations and travel.
Most of the time the same insurance company that insures your home will be happy to schedule any items you like. But if you have something super pricey, like a $250,000 concert grand piano, your agent may need to locate a specialty insurance carrier.
"The biggest thing with antiques is if you have a fire and your policy has a limit for $100,000 in personal items, the insurance company will replace each item with a new item similar in style," Ms. Scott-Buckley said. "But if one of your chairs was an 1800 Chippendale, unless you had it appraised and scheduled, you'll end up with something from Ethan Allen for $200 instead of $50,000."
"It's easier to appraise jewelry because of the set market values [for precious metals and stones]," she said. "If you own three Chippendales for $10,000 a piece, you don't want to have that argument with an insurance company after a fire. You want to make sure you establish the value by scheduling the items on a policy."
Tim Grant: firstname.lastname@example.org or 412-263-1591