Remember to Schedule!

Christmas and Valentine’s Day are the two big jewelry-giving holidays, so let’s take a look at how that needs to be insured.  You can usually purchase a warranty from your jeweler for the workmanship, but the jeweler probably isn’t going to be able to help you out if your wife’s new ring melts in a house fire.

Jewelry can be covered under your homeowner’s policy.  You’d need to check your particular policy for the details, but let’s look the Centennial policy at one from one of our major carriers, RVOS.  Jewelry falls under the personal property portion of your coverage, which is normally a percentage of the dwelling coverage.  So if you have your house covered for $100,000, you might have your personal property at 60%, or $60,000. 

If you choose to leave your jewelry unscheduled, then there’s a piece of that personal property pie that’s set aside just for jewelry.  The default limit for that is $700.  So if you lost every piece of jewelry you own in a fire, you’d only get paid $700.  If all you wear is costume jewelry, then that probably won’t concern you too much.  If you have a few nice pieces though, you’d want to get an endorsement to increase that unscheduled jewelry limit.  You’d still have $60K in coverage on your personal stuff, but you’ve allocated a bigger piece of pie just for your jewelry.

If you have a large jewelry collection, or a few very valuable pieces, then you’d want to schedule your jewelry.  To do this, you’d have to provide a list of the special pieces you want covered, along with their values.  Items worth more than $1,000 require an appraisal, and you’d need to provide photos on items worth $5,000 or more.  The coverage on these items would not be part of the $60K personal property pie because they’re listed separately.

Of course, all policies are NOT created equally.  Some policies may have higher limits for unscheduled jewelry, and some may require you to schedule all jewelry.  You’d need to actually read your policy in order to know for sure.  If you’ve purchased a new diamond bangle bracelet for your wife, check with your insurance agent to make sure it’s approriately covered.  The same goes for antiques, collectibles, art, and furs.

Homeowners Insurance and Your Car

Some of the top search phrases for this site have been about paying off the remaining balance on your vehicle, and whether homeowners insurance covers that.  Long story short, no, your homeowners insurance will not cover your vehicle itself.  You have to have an auto policy that has comp & collision coverage to repair your vehicle.  If your vehicle is a total loss, the check the company writes you may be for less than what you owe on your vehicle, depending on how you’ve financed it.  Gap insurance, which is usually available from the financer or your auto insurance company, pays the difference between what the insurance company pays for the vehicle and what you owe on it.  Homeowners insurance never comes into play in this scenario.

What your homeowners policy WILL cover is the stuff in your car that isn’t installed.  It won’t cover your stereo system or your built-in DVD player, or to repair your broken in windows.  It will cover your purse if it’s stolen after the windows are broken in.  Check your homeowners policy for the amount of coverage provided.  There will most likely be a limit to the cash covered in your purse – how easy would it be to claim that you had $10,000 in that stolen purse?  Also, there may be a limit on the amount that’s covered when it’s “off premesis.”

In summary, your auto policy covers your auto, as long as you have comp & collision coverage.  Your homeowners policy covers your home and your “stuff.”

Better Television, One Policy at a Time

Moses and I were getting ready to go in to the office on Saturday for an appointment. As usual, I was ready about half an hour before him, so I turned on the television. Since we live in the boonies and still only have a rabbit ear antenna, my program choices were limited to a cartoon in which sushi comes to life and fights bad guys with their ninja skills, or courtroom shows. I went with Judge Joe Brown.  Now, it’s been a while since I’ve had the chance to watch this kind of show, but I was really surprised at how many of the cases could have been avoided if these people had simply had proper insurance coverage.

In the first case, a young woman went to a birthday party and asked her friend to be the designated driver.  The friend, though sober, managed to hop the curb and demolish the vehicle.  The first young woman’s mother, who owned the car, was seeking about $2,500 in damages to replace the car.  Insurance was never mentioned in this scenario, but if the vehicle’s owner had purchased comprehensive & collision coverage, she’d have been okay.  She’d have had to come up with $500 or $1000 on her own to cover the deductible, but she’d be able to take her daughter’s friend to small claims court to get that back.  That would be a smaller headache, and she’d have her replacement vehicle sooner.

In another case, a woman was sitting on her patio and watched as another woman side-swiped her Camry.  The driver claimed to have had a sneezing fit and lost control of her vehicle while reaching for a box of tissues.  The driver’s insurance had lapsed for two or three weeks.  The owner of the Camry claimed that her vehicle was worth about $9,000, but the driver claimed that it was worth much less and was only willing to pay about half that.  There are a couple of ways that this court case could have been avoided.  First, the owner of the Camry could have had comp & collision coverage.  Like the previous case, she’d be out the deductible and could take the other driver to small claims court.  She could have also been protected by uninsured motorist coverage.  In this case, she’d have a much smaller deductible – around $250.  Also, her insurance company would be the ones taking the other driver to court, and they have a lot more attorneys than she can afford on her own.  Gap insurance would also cover the difference between the value of the vehicle and the amount she owed on it.

These are the two main examples that really stand out in my memory, but I’m certain there are a lot of unnecessary cases showing up on these shows.  And, quite frankly, getting rid of these types of cases would make room for more entertaining cases.  Remember, just because a type of coverage isn’t required doesn’t mean you don’t need it!