An engagement ring signifies a promise. While these rings vary in size, style and value they’re often treasured by their wearer. It can be devastating to lose your engagement ring, especially if you cannot afford to replace it – like you’ve broken that promise. While insurance can’t fix the loss, insurance for engagement rings can help replace the ring. Even better, this coverage is often already included as part of your homeowner, condo, or tenant insurance policy.
Standard Coverage for Jewellery
Most homeowner, condo or tenant insurance companies include jewellery as part of the personal belongings. However, there are a few things to know:
- There are limits on the amount of coverage overall (usually between $6,000 and $10,000 in base wordings).
- There may be a single item limit on the amount of coverage per item (this can range from $1500 to $3000). Not all policies have this single item limit, however.
- You may be required to get your jewellery appraised.
- Make sure you know how a loss will be settled (the market value or as-new price).
- You will need to pay your policy’s deductible for a jewellery claim.
Theft or mysterious disappearance is usually covered, but you may have a limit on how many times this peril is insured.
Increasing Your Insurance for Your Engagement Ring
If you have a larger jewellery collection or your engagement ring is particularly valuable, you may want to increase your coverage. There are a few ways to do this:
- Increase your jewellery limits on your property insurance. Some companies offer up to $50,000 limits.
- Add a jewellery rider to increase the amount of coverage.
- Schedule your jewellery.
- Purchase separate insurance for your engagement ring or entire jewellery collection.
Increasing Your Jewellery Limits
Your property insurance provider may offer different levels of coverage for a jewellery collection. You may be able to increase your limits to better reflect the value of your engagement ring. For example, you may have $10,000 of base coverage for all your jewellery but you may be able to upgrade to $15,000 worth of coverage.
The amount of extra coverage available depends and increases are not offered by all insurers. Talk to your broker to see if this is an option for you.
Add a Jewellery Rider
Instead of increasing limits, an insurer may offer a jewellery rider. This essentially does the same thing – increases your jewellery coverage to a higher amount.
Scheduling Jewellery
This is a good option if your engagement ring is worth more but the rest of your jewellery doesn’t exceed the limits of your base property insurance coverage.
Scheduling provides a limit of insurance for a specific item based on a jewellery appraisal which is submitted to the insurance carrier. If your engagement ring is damaged or lost, you’ll be directed to a jewellery wholesaler or manufacturer where it can be replaced for as little as 50% of what you paid for it.
Some carriers offer scheduling on a “valued” form which in the event of a loss pays out the scheduled amount regardless of actual replacement cost.
This also has the benefit of not needing to pay your home insurance policy deductible if you have a jewellery claim.
Purchase a Separate Insurance Policy for Your Engagement Ring
Similar to scheduling your jewellery but on a separate insurance policy from your home. This means a jewellery claim will have a separate deductible and premium. This option offers more comprehensive coverage and is the best option for those who have truly expensive engagement rings or more extensive jewellery collections.
A separate policy will cover risks like theft, disappearance, replacing a gem that’s fallen out, and damage destruction by insured perils.
Your insurer will again direct you to a jewellery wholesaler or manufacturer although some will pay out the valued amount regardless of the replacement cost.
Appraisals
Get your engagement ring appraised using a member of the Certified Accredited Appraiser Program (CAAP). A copy of this appraisal should be provided to the insurer; you should also keep a digital and paper copy for yourself. You may need to get a new appraisal every few years.
If the ring was recently purchased new, you can simply use your receipt – as long as what you paid is reflective of the engagement ring’s actual value.
How much does insuring my engagement ring cost?
Generally, insuring an engagement ring is quite affordable. If it’s covered under the base wording of your property insurance, there won’t be any extra premium.
If you’re opting to increase your jewellery limits or schedule the engagement ring or purchase a separate insurance policy, you will pay more. Your rates will be affected by:
- The value of the engagement ring (and any other pieces you’re insuring).
- Your coverage, including settlement options, policy limits and deductible.
- The crime rate of where you live.
- How you’re storing your jewellery and if there are any security features.
- Your insurance and claims history.
For a separate jewellery policy, your premium will be around 1% to 2% of the ring or the collection’s value. If you’re insuring an engagement ring worth $100,000, your annual premium would be between $1000 and $2000.
An Engagement Ring Claims Example
Let’s assume the lost engagement ring was bought for and appraised at $15,000.
Your home policy carries a jewellery limit of $6000. The jewellery wholesaler can replace it for $9000.
If your ring is not scheduled or insured on a separate policy, you will need to pay your home insurance’s deductible. The most you will receive for the loss is $6000 but you will also need to pay the deductible. For example, if the deductible is $1000 you’d essentially only get $5000 covered as this is the jewellery limit minus the deductible on the policy.
If the ring is insured to $15,000 as it is scheduled or you have a separate policy for it, you can either replace the ring at the wholesaler or cash settle for $9000. If your settlement is a valued form, you would receive the full $15,000 cash amount (or you could go to a jewellery store and purchase the replacement for up to $15,000).
Losing an engagement ring can be emotionally devastating. Insurance can’t repair the loss, but it can help afford you a new ring. Speak to a broker about your options today.
