Getting engaged for Christmas or New Years is very exciting and romantic. It could involve a beautiful one-carat diamond ring that looks amazing on your finger!
There’s so much planning to do for the big day, but don’t forget to insure your ring from theft, if the diamond falls out, or the ring mysteriously disappears.
You’re getting married, but you still have options
Just like rings come in all sizes, insurance policies aren’t a one-size-fits-all product. It’s important to find the policy that fits your needs. But, what are your options?
Blanket endorsements. One option is a blanket endorsement, also known as a rider, on your property insurance policy. This type of coverage allows you to have a specific dollar limit on the policy for all your jewelry. Usually, this is an inexpensive option, but it is probably better for several small items with a much lower value. Plus, there are limitations, such as a small limit per item, and a mysterious disappearance could be excluded.
Scheduled coverage. The next option is to schedule—list a specific item on a specific insurance policy—the ring on your homeowners insurance policy. With this option, coverage is increased greatly, and it should include a mysterious disappearance, and if a stone falls out of the ring. This can be done either as stated value (the current cost of the ring) or replacement cost (the cost it would take to replace the ring in the future).
While insuring an item for its stated value generally is more cost effective, it does have its disadvantages. For example: If the value of the ring increases, you only would receive the stated value.
If you decide to insurance your ring for replacement cost, the general rule is the cost per $100 of coverage usually increases as the value of the piece increases.
A note of caution if your homeowners insurance is paid through your mortgage: If the mortgage company neglects to pay the homeowners insurance premium, then you would lose the coverage on the ring. Often, this happens if a mortgage is sold, and the purchaser of the mortgage misses the renewal payment.
Specialized insurance. Lastly, you can insure your ring through a specialized insurance company that only covers jewelry and fine arts. Usually, the coverage is more comprehensive, and the pricing is competitive. And, since you will be paying for the policy yourself it will be in your complete control.
This is a lot to think about, but this is when an independent insurance agent can help you review your options. He or she can guide you and help you make the decision about which option is best for you and your ring. That way, you can focus on the date, the venue, the dress, the flowers … Have you considered wedding insurance? An independent agent can help there, too.
Roger C. Butler, CIC
Roger Butler, CIC, is vice president of PIA of New Jersey. He also is vice president of personal lines at The Barclay Group in Riverton, N.J. Butler is an active member of PIANJ, and he has served on its board of directors and on several committees. Currently, he serves on the PIANJ Business Issues Committee. He is a Certified Insurance Counselor, and he is a member of the National Alliance. He is a past chair of the Skylands Producer Agency Council. In addition, he is a past member of the Mercury Agents council. Active in his community, Butler is vice chair of the Cinnaminson Board of Fire Commissioners, and past secretary of First responders JIF and past fund commissioner to the Municipal Excess Liability Fund.