While no one can put a dollar amount on sentimental value, insuring your prized possessions will help keep them financially protected if they’re lost, stolen or damaged. Whether your most treasurable item is a diamond ring or a set of golf clubs, don’t forget to review your insurance coverage or you may face an unpleasant surprise if you suffer a loss.
Many people don’t realize a standard homeowner’s policy offers very limited coverage for certain valuable items like all-terrain vehicles (ATV), guns, jewelry and other items. For example, a Farm Bureau Insurance® HO3 policy has a limit of:
- $500 for recreational vehicles, including ATV’s and golf carts.
- $2,000 limit for theft of firearms.
- $1,000 limit for theft of jewelry, watches, furs and precious or semi-precious stones.
For these items and others listed in the policy, the policyholder can receive no more than the limit specified. While some items are subject to special policy limits, a homeowner’s policy may not provide any coverage for certain losses.
Properly insuring your valuables can be done easily and in many cases, it costs very little. An existing homeowner’s policy can simply be endorsed to provide coverage by scheduling, or listing, valuables to be covered. If there is no property policy to endorse, a separate policy, known as an inland marine policy, can be purchased. An endorsement and inland marine policy offer much broader coverage than a homeowner’s policy by covering any cause of loss unless it is specifically excluded.
For example, if an expensive camera is knocked to the ground and damaged, a homeowner’s policy provides no coverage for this type of loss. However, an endorsement or inland marine policy would provide coverage for the loss.
Whether an existing policy is endorsed or an inland marine policy is purchased, an appraisal will likely be required. Once coverage is in place, a new appraisal should be provided every three years to ensure the item is properly valued, especially if it has appreciated. Keeping appraisals up-to-date is very important, since an outdated appraisal may limit what can be recovered if a loss occurs. Also, it’s important to keep in mind that the coverage limit does not represent what would be paid should a loss occur. A claim payment would be based on the actual cash value of the item up to the stated amount.
If you already have an endorsement or have purchased an inland marine policy, as you acquire new items you must add them to your policy. This must be done within a specific period, or a loss may not be completely covered.
Failing to make sure your valuables are properly covered can be a costly mistake. Be sure to schedule an annual review of your coverage needs with your local Farm Bureau Insurance agent who can assist you with adding coverage for your most prized possessions.