Have you insured your jewelry?

It's always a good idea to have insurance on your personal belongings, either with renter's insurance or home owner's insurance. Ask anyone who's ever had a disaster like a fire, and they will tell you how important the insurance was. Imagine having to furnish a house from scratch and to purchase an entire wardrobe? The cost of that is huge, while the cost of insurance can be relatively low.

If you're a lover of fine jewelry like I am, you also need to make sure that you have adequate coverage for your valuables. Many insurance policies offer very limited coverage for those items. For example, my policy only offers standard coverage of $1,000 per piece of jewelry, up to a maximum of $5,000 total.

I have a rider on my policy that covers additional jewelry, and I highly recommend it. The rider has an increased limit on the total payout. Individual pieces are also covered under the rider, and whenever I get a new piece that is over a certain dollar amount, that piece is added to the policy.
The great thing about the insurance is that it not only covers theft or destruction of the jewelry. It also covers loss, so in case the unthinkable happens while I'm wearing my jewelry, I have some coverage.

Talk with an insurance agent for the specifics about jewelry coverage. There are a lot of options and you might need help deciding what's right for you. You'll have to select a deductible. You'll want to know if the policy covers the replacement cost of the insured value. You should find out if you can use a jeweler of your choice to replace an item, or if the insurance company dictates the jeweler. (That can make a big difference, especially if you've got very unusual pieces or custom designs.)

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.
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