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Don’t Take a Risk With Your Valentine’s Day Gifts

NEW YORK, February 7, 2006—If you receive an engagement ring or other piece of expensive jewelry on Valentine’s Day, make sure you have the necessary insurance, advises the Insurance Information Institute (I.I.I.).

Standard homeowners and renters insurance policies include coverage for jewelry and other valuable items such as furs. However, many policies limit the dollar amount of coverage for the theft, or loss due to a covered peril, of such items—the limit is usually $1,000 to $2,000.

“To properly insure jewelry and other expensive items, consider purchasing additional coverage through a floater or an endorsement,” says Jeanne M. Salvatore, senior vice president and consumer spokesperson for the I.I.I.

With floaters or endorsements, you are also covered for “mysterious disappearance.” This means that if your ring falls off your finger or is lost, you would be financially protected. There are no deductibles and frequently you will get the option of having the insurance company replace the item for you, according to Salvatore.

Floaters and endorsements are available as additions to home and renters insurance policies. Some companies offer a standalone policy that covers jewelry without having to purchase a home or renters policy. Prices for floaters and endorsements will vary depending on the type of jewelry, the insurance company you choose, where you live and where the item will be kept.

“While there is no way to insure the sentimental value of jewelry, having it properly insured will provide financial protection in the event it is lost or stolen,” says Salvatore.

To make sure your jewelry is adequately protected, the I.I.I. suggests:

Contact your insurance professional immediately

Let your agent or company representative know that you are now in possession of an expensive piece of jewelry. Find out how much coverage you have and if additional insurance is needed.

Have the item appraised

Heirlooms and items that were purchased several years ago will need to be appraised for their dollar value. Ask your insurer for recommendations regarding a reputable appraiser. It is important that expensive items be appraised properly. If you purchase a floater or endorsement, your premium will be based on the appraised value and, in the event of a claim, you will be compensated accordingly.

Keep a copy of the store receipt

You should forward a copy of the receipt to your insurer so that the company knows the current retail value of the item. Keep a copy for yourself and include it with your home inventory.

Store valuables in a secure location

Protect your jewelry by storing it in a secure location in your home. If you don’t plan to wear the item regularly or are holding it for a child, consider keeping it in a safe deposit box. You may save money on the cost of insuring it as some companies offer “in vault” coverage. If you want to wear the jewelry for a special occasion, many insurers will offer the option of purchasing additional coverage for the time it is out of the bank; you do, of course, have to notify your insurer ahead of time if you plan to do this.

Update the value of your jewelry

Expensive items can go up or go down in value. Talk to your insurance professional about how to make sure the dollar amount of your floater or endorsement reflects these changes.

Take a picture of the item or collection

Get into the habit of keeping a visual record of all of your personal possessions. This helps to document your loss and can speed up the claims process. It is also useful when documenting antique and unusual pieces of jewelry.

Add the item to your home inventory

Everyone should have an up-to-date inventory of their personal possessions, including valuables. This can help you purchase the correct amount of insurance and will make the claims process easier if there is a loss.

The I.I.I. is a nonprofit, communications organization supported by the property/casualty insurance business.

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