January 18, 2019

For love’s sake, insure that ring

Sound unromantic? It’s not a topic we love either, but it’s important to insure that diamond ring, just in case. After all, that’s what insurance is for. If nothing else, it’ll give you peace of mind that the ring you’re rockin’ can be replaced if (huge gulp) something happens to it. So, what’s the deal with engagement ring insurance?

Before choosing a policy, here are some things to consider.

Which one of you should carry insurance on the ring? Both of you.

- The purchaser should get insurance as soon as possible after purchase. You wouldn’t drive a car off the lot without insurance, right?

- The recipient should also get insurance after accepting the ring as a new piece of personal property. After you’re married, don’t forget to update the policy with the new information.

How do you insure it?

 - Keep all original receipts in a safe, secure location so you have proof that you didn’t obtain the ring from a pawn shop or the like.

- Get it appraised by an independent appraiser with excellent credentials such as a degreed, certified gemologist who will:

  • Review the diamond’s GIA Grading Report
  • Examine the stones for quality and flawlessness
  • Determine the metal type and purity, and note any identifying marks
  • Provide a signed, accurate, un-inflated value assessment certificate

- Get it reappraised by the same gemologist, if possible, every two or three years.

- Decide on an insurance provider.

Who provides jewelry insurance?

- Only a jewelry-specific insurer provides jewelry insurance. With this type of insurance, if you have a claim, it doesn’t affect other insurance policies.

- A renter’s or homeowner’s policy can typically include a rider for jewelry, since the stated jewelry coverage in a normal policy might not protect you for the value of your ring. Most cap out at $1,000, which means if your renter’s or homeowner’s deductible is $1,000, guess what? A ‘scheduled personal property coverage’ will better cover your ring.

- Bear in mind, though, that some property insurers will charge up to 6% of a ring’s value, rather than the 1% to 2% a jewelry-specific insurer will charge.

- Make sure whoever you go with has a good reputation.

How much will it cost?

- Expect to pay 1% to 2% of the ring’s value annually, based on:

  • Value of the ring
  • Where you reside and the local theft rate (if you move, notify your agent as your coverage/premiums may change)
  • The cost of your deductible

What should you look for when insuring the ring?

- Is it covered if you lose it — or only if it’s stolen?

- Is it covered for its full value or only partial?

- What proof is required if the ring vanishes?

- Does the policy even cover mysterious disappearances?

- What types of loss or damage are excluded?

- Is the coverage for ring replacement or cash reimbursement?

- Are repairs and maintenance included?

- Are you covered while traveling? Do they cover just the U.S. or North America? If you’re a jet-setter, find another policy.

- Can you select your own jeweler for replacements and repairs? This is especially important with replacements, as you might want the original maker of the ring to also make the replacement.

- What happens if there isn’t a suitable replacement available?

- Does the policy adjust with inflation?

- What gets applied against the deductible if there is one?

- What are the coverage limits?

According to Michelle Page, staff gemologist at a Los Angeles company and a GIA Graduate Gemologist holding special certificates in diamonds and colored stones, and gem identification and appraising, “Every insurance company seems to be somewhat different on what they require on the appraisal and how they insure. Some do a cash payout, others do an item replacement through their own jewelry companies that they have arrangements with. I always recommend they find out which way their insurance compensates up front.”

Don’t compromise or cut corners on insuring this valuable, sentimentally precious piece of personal property. Talk to insurance company representatives. Ask your questions — all your questions. Don’t stop until you’re satisfied.

And don’t forget to carefully read the fine print of your policy, regardless of whether you go with a jewelry-specific insurer or add a rider/floater/endorsement to your existing renter’s or homeowner’s policy. Be sure you end up with a policy that will cover any scenario of loss or damage, including your two-year-old niece flushing it down the toilet to see the pretty swirly sparkle disappear. Don’t find out the hard way that you lack the right coverage. Imagine how you’d feel if you lost your ring and couldn’t replace it. For love’s sake, insure that ring.

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