Most home insurance policies provide a wide array of coverage on the home you’re your personal property. However, one policy area that is purposely weak when it comes to coverage is when it applies to certain items such as jewelry, artwork, and collectibles. The reason it’s purposely weak is all home insurance companies believe the best way to protect these items is either scheduling it on your home policy or on a separate personal articles floater, or PAF, policy. Let’s examine what should be scheduled and why!
Scheduled items, or a PAF, is optional coverage or an optional policy, designed to cover high value items up to their full amount such as a $5,000 watch, a $20,000 painting, etc. The amount is established using either a receipt or appraisal for that item. Most carriers prefer an appraisal be no older than five years old, although some may waive that requirement. I recommend items like jewelry be appraised every five years as prices for gold, platinum, and certain stones can fluctuate greatly.
Items that can be scheduled on most home insurance policies include jewelry, original artwork and sculpture, oriental rugs, antiques, furs, silverware, gold ware, crystal, porcelain, stock securities, musical instruments, guns, and collections (stamps, coins, trading cards, comic books, and first editions of noteworthy authors. While most home insurance policies provide some level of coverage for these type of items, there are a couple of reasons to schedule these items:
- Amount of coverage
- Types of loss
Amount limits: Most companies have a limit on the amount they’ll cover on these items. That limit can either be on a per piece basis, such as $1,000 on a single item of jewelry, or on an aggregate basis for the total amount of coverage on all jewelry. The insurance company, is thereby, limiting the amount they’ll pay on a claim regardless of the type of loss (fire, theft, tornado, etc.) to a specific dollar amount. Any person desiring more coverage needs to schedule the item or items for the amount to be fully covered.
Types of loss: Insurance companies may also restrict the type of loss they’ll pay for an item if it’s unscheduled. In these cases, most carriers will cover an item up to the amount covered in the base policy limit if it’s lost in a fire, tornado, etc. but not if it’s stolen, lost or mysteriously disappears. Scheduling these items usually expands the perils to include theft and loss due to mysterious disappearance.
If you own jewelry or collectibles but have not scheduled them, take a moment to review your policy limits on the amount of loss (per item and aggregate), as well as the types of losses covered. It’s better to know this now rather than after fact! What do you think? Share questions, comments, and experiences with me on my Facebook, Google + and LinkedIn pages. I’d love to hear from you!