Are Those Cool Holiday Gifts You Received Covered By Insurance?

Perhaps you got engaged over the holidays and if so, you might have even thought about insuring the ring. Congratulations and good for you for thinking about insurance!

Jewelry is understandably important to insure, but what about that Apple watch? Is that covered? And what about that hunting shot gun? Maybe you could just ask Alexa, another popular gift in 2016. Don’t have Alexa? Better keep reading…

Home insurance policies have a section called Special Limits of Liability regarding personal items. While the limits can vary from company to company, they often will read something like this:

The special limit for each category below is the total limit for each loss for all property in that category.

• $5,000 for loss by theft of jewelry, watches, furs, precious and semi-precious stones.
• $2,500 for loss by theft of firearms, and related equipment.

While the $5,000 amount is enough to cover your new Apple watch, what if it wasn’t actually stolen?  And what about your deductible, does that apply?

The deductible does apply and most homeowners have a $500-$1,000 deductible. So, if your $400 Apple watch is stolen, it’s covered because the policy reads loss by theft. But because the deductible applies and is over and above the value of your item, the insurance company is not going to buy you a new Apple watch.

Maybe you treated yourself to a new $1,800 Browning Citoro 12 gauge shot gun. If it gets stolen it’s covered, less the deductible. But what if you set it down while packing up to leave the woods and when you head back to look for it in the morning you can’t find it? Was it stolen? Someone could have picked it up, but you know you forgot it and couldn’t find it the next day. The insurance contract says $2,500 if stolen, but if you misplaced it there is no coverage.  

There’s an easy solution to avoid these situations. In the same manner that you would schedule that engagement ring, you can schedule firearms, watches, and many other types of property. It broadens the coverage and you can eliminate the deducible. Additionally, scheduling your property establishes the value of that item up-front, so there is no confusion on value should a claim arise.

Talk to your insurance professional if you have any questions.