Some possessions are worth more than others; a wedding ring, heirloom piece of jewelry, notable work of art or a prized antique can carry significant value, in terms of both money and sentimentality. For these special possessions, is it worth investing in extra insurance coverage?
Current policy check
As homeowner or renter, you probably already have a homeowners or renters insurance policy, which should offer you financial protection over your dwelling and possessions in the event of damage or theft. These policies are important, sound investments, but unfortunately can be limited when it comes to high-ticket items like a wedding ring, according to Investopedia writer Stefanie O’Connell. For example, if your ring or priced possession would cost more than what the insurance policy is able to give you, additional insurance might be worth the price. Though she advises acquiring an appraisal that abides by the insurance company’s rules to determine the actual value of the item in question before you start shopping for an extra policy. The bracelet handed down through generations believed to feature flawless emeralds could just be a stellar piece of costume jewelry — still beautiful and special, just not extra insurance-worthy. Or the amount your current policy earmarks for jewelry replacement could be enough to cover the cost of your sentimental band.
Insurance rider/endorsement benefits
The coverage afforded by an insurance rider or endorsement can be the extra coverage you need to protect your valuables. The best part is that it can complement your current plan. According to The Balance writer Mila Araujo, if your home boasts fine art, silverware, Oriental rugs, priceless jewelry, furs or antiques, a rider could be a shrewd investment.
“A rider or endorsement is like a ‘mini-insurance policy’ added to your current homeowner's insurance policy and it will give added protection to certain items that may be excluded or have low limits on your homeowner's insurance policy,” explains Araujo.
High-value home insurance is another option if you’re struggling to find a rider/endorsement or traditional policy to fit your needs or to cover the multitude of high-ticket items you want to protect, she adds. Although insurance endorsements and riders offer more coverage than a traditional homeowners or renters insurance policy, they still have limits.
“There are high-end insurance policies that will have higher special limits, less exclusions, as well as better claims settlement options, such as no obligation to replace policies,” according to Araujo.
Extra insurance cost
The decision to invest in extra insurance to protect your possessions must be made thoughtfully after a serious conversation with a reputable insurance agent or two. Start with your current agent for a quote and branch out to different insurance companies if necessary. By truly vetting your current policy limits and rules, researching policy options and the value of your items as well as the cost of replacing them will help you determine if investing in extra insurance is right for you, according to O’Connell.
Discover the value of the items you’d be heartbroken to lose to figure out your insurance needs. You never know when you might need to make a claim.