Recently engaged or married? Congratulations! Now, how to best protect those beautiful new valuables – engagement and wedding ring insurance.
It happens remarkably easily. In fact, over a recent five-year time span 14% of men lost an engagement or wedding ring and 8% of women misplaced their rings. The rings, arguably one of the most important symbols to any loving union, can be a huge financial investment. An investment profoundly felt when the money is spent, and even more so if they go missing.
The odds of finding them again are slim, but the odds of replacing them doesn’t have to be if you’ve thought ahead.
Wedding rings, and engagement rings, in particular, are expensive. And something that expensive should be protected against damage and loss. But what type of insurance is best for an engagement or wedding ring? The value of these items is two-fold financial and sentimental. So, is it best to insure them under your home or renters insurance policy, via a third-party jewellery insurer, or simply rely on the warranty from the jeweller?
Regardless of how you decide to insure your ring, you first have to determine how much it is worth. The value of the ring will determine the level and cost of the coverage you’ll get.
We suggest you have the ring appraised by either a certified appraiser or jeweller. The cost for this service can vary. Some appraisers will charge a flat rate for the service; others might take a percentage of the value of the ring as their fee.
Appraisals aren’t a one-time deal. With global markets are constantly in flux, the value of your ring is going to fluctuate, as well, depending on the types of gemstones and precious metals it’s comprised of and the current value of those materials.
Industry recommendations for how often to appraise range from every two to five years. Whenever you get an updated appraisal, you should inform your insurer, as you don’t want to risk being underinsured. Know, too, that the updated value may also change your premiums.
Some insurers, such as Jewelers Mutual, which provides coverage for all personal jewellery items and jewellery businesses in Canada (with the exception of Quebec) and the U.S., will provide something called “inflation guard protection, or insurance value adjustment.”
“This feature will automatically adjust the insurance value of insured items when an updated appraisal has not been received for a period of time,” says Bryan Howard, director of product and risk management at Jewelers Mutual.
“This adjustment is based on the latest results for Jewelry and Watches within the Consumer Price Index, and protects the customer from their jewellery items being underinsured.”
Armed with information – the precise value of your ring – you can start considering how you’d like to insure it.
Have questions about insuring specific valuables? Talk to us!
Insuring wedding and engagement rings under your home or renters policy
Choosing this type of coverage for your jewellery is relatively straightforward as you simply keep all your property insurance with one company.
However, most home and renters policies will include only a base amount of coverage for jewellery, or a limit — usually around $6,000 or less for each claim you make. So, your first step should be looking at the policy language to determine what the cap is for jewellery items, and whether or not you’ll need to purchase additional coverage (called an “endorsement”) in order to fully cover the cost of the ring.
Typically, home and renters policies will cover loss or damage to the ring. The specific amount of coverage is usually determined by figuring out how much it would cost to replace the ring, as well as other factors like where it’s being stored and who’s wearing it.
If you need to make a claim for loss or damage to the ring, you would contact your home or renters insurance broker. Depending on the insurer, you might be able to obtain an actual cash value for the ring (though keep in mind that your insurer will take into account how much the ring has depreciated in value since you bought it) or a replacement ring that’s similar in quality and type. You may need to hand over any receipts from appraisers or the jeweller from whom you bought the ring.
Choosing insurance for your rings through a jewellery insurer
Another option is to purchase standalone jewellery insurance from a dedicated jewellery insurer.
“Each company is unique in what they offer in terms of their cost and level of coverage,” says Howard. “Warranty products will cover damage to the item and maybe a few types of losses, such as where they lose a piece of the item that they purchased. Insurance policies tend to be a little more comprehensive from that standpoint, where they’ll cover theft, damage to the item, things like that.”
But no matter where you’re getting your insurance from, Howard recommends doing your research and sifting through the policy language to see what amount and type of coverage you’re getting with each provider.
Each insurer will ask for different information, but if a customer applies for a policy with Jewelers Mutual, they’ll need to provide the value of the ring, who is going to be wearing it (and how often), where it’s going to be stored, and how it will be used. These factors will determine the level of coverage, with deductibles that can range anywhere from $0 to $25,000, depending on the value of the ring, says Howard.
“We’ll also ask for permission to run an insurance score,” he says. An insurance score, he explains, is a way for insurance companies to determine your insurability by looking at your credit or financial habits. It’s completely optional in Canada and the customer must consent to it.
A jewellery policy at Jewelers Mutual, for example, will typically cover loss, theft, or damage to the ring.
“Let’s say you hit your engagement ring on the side of the table and you chip the stone or bend or break the prong or setting that holds the stone in place,” says Howard. “Those are typically types of perils or losses that are covered in our policy language.”
There’s no difference in coverage for male versus female rings, and it’s possible to insure multiple items under one policy. The most important thing is making sure you have the appropriate coverage when you need it.
“The minute that it leaves the jewellery store,” says Howard, “it’s the individual’s responsibility to ensure that it’s protected.”