FAQ – Special Personal Property


While many of your possessions may be of the routine variety, it’s likely that some pieces may be special, having decorative or other features, particularly age, that may qualify it as art, an antique or both. Examples are expensive china, porcelain statuary, paintings, etc. However, other types of property may be harder to define.

Most policies do not provide a definition of either antique or fine art nor does any industry standard exist. Therefore we have to rely on the commonly understood definition used by a reasonable person, in other words a dictionary definition. Let’s look at two definitions found in the American Heritage Dictionary.

antique – 1. Of or belonging to ancient times, 2. Belonging to, made in, or typical of an earlier period and 3. Old-fashioned-An object having special value because of its age, especially a work of art or handicraft that is more than 100 years old.

fine art – 1. Art produced or intended primarily for beauty rather than utility, including sculpture, painting and music and 2. Something requiring highly developed techniques and skills.

Regardless the definition, basic property insurance policies are designed to handle commonplace property. Special property coverage is either excluded or severely limited. To protect such property, it is important to either modify a policy by adding additional coverage or to purchase a special, separate policy.

Before arranging for coverage, it is important to establish the value of the property. In many instances an inexpensive source such as a price guide or list may be available to determine value. Other methods may be to have the value determined by a professional appraiser or to use current receipts or sales bills. Provenance is also important. Provenance is just a fancy term for documents that prove an item’s history, particularly when there are facts that affect value such as documenting an early year of manufacture, relationship to some historical event or even previous ownership by a famous person. Once a current value is determined, adequate insurance should then be purchased.

Properly describing and setting policy limits to protect uncommon and high-priced items eliminates problems at the time of loss. It reduces the chance of coverage being denied and more clearly defines what is covered and for how much. If you wonder whether you have the right coverage as well as the right amount of coverage, contact an insurance professional to discuss your situation. Perhaps you’ll both develop a greater appreciation for arts and antiques.

Have Any Tips On Insuring Jewelry?

Basic homeowner policies provide very limited coverage for property such as jewelry. The reason for this is that jewelry is high-valued (especially in relation to its size), is easily lost or destroyed and is vulnerable to theft and fraud. If your jewelry holdings are modest (say just a few hundred dollars), perhaps the limited coverage provided by a basic policy is adequate. However, when high values are involved, consider buying special insurance coverage. A few options are available such as buying supplemental insurance that is attached to your homeowners or tenant’s policy or purchasing a special, separate jewelry policy.

The important step is to discuss the coverage options with an insurance professional. Discussing the coverage will allow you to understand how a loss will be paid. Does the coverage consider values that increase over time? Does it cover mysterious disappearance (when you know the property is gone, but can’t pinpoint when and how the property was lost) and other causes of loss, or just fire and theft? Discussing the coverage also helps you understand the steps you must take to make sure that you keep the maximum coverage in force and whether the coverage you receive is worth the additional price.

Documenting The Jewelry’s Value

If the jewelry has just been purchased, a store receipt or certificate should establish the insured value. However, as time passes or circumstances change, the insured value should be reevaluated, perhaps by seeking an appraisal. Getting an appraisal that affirms your jewelry’s current value is an excellent way to assure that your property is properly protected. Of course, make sure that you work with a competent appraiser (check their credentials and number of years of experience). It is also helpful to talk to a potential appraiser. Does she seem to have expertise? How willing and able is she to explain her work? There are several professional jewelry and appraisal associations that can give you information on appraisers and appraising methods. All of these items are important, especially since you have to pay a fee for an appraiser’s services.

Handle With Care

Once you’re certain about the value of your jewelry and the adequacy of its insurance coverage, you need to properly handle your jewelry. After all, who wants to actually file a claim? If you own a significant amount of expensive jewelry you may want to look into other precautions such as:

  • Get new appraisals every two or three years, sending a copy to your insurer
  • Take photos of your jewelry from several angles; again, share copies with your agent or insurance company
  • Consider a quality in-home security system, including a hidden vault or storage area
  • Take care on where and when your jewelry is worn to try to avoid becoming a theft target
  • Keep original receipts and all appraisals, especially if they demonstrate that the jewelry’s value is appreciating
  • Ask your jeweler whether they have access to “Gemprint,” a jewelry identification system that documents a jewel’s distinctive markings much in the manner of fingerprinting.

Again, your first step is to talk to an insurance professional since he or she shares your concern that you have the protection you need at a price you can afford.

Covering Coins Collections

The official name for the study and appreciation of coins, currency, medals and similar property is called numismatics or coin collecting. Collecting coins is still quite popular and interesting because it involves geography, culture, history, precious metals, economics, monetary laws, politics and customs. It also touches upon the arts and sciences as it deals with engraving, designing and even metallurgy.

This hobby has a big impact on insurance coverage. Homeowner (including tenant) policies provide extremely limited coverage for property like money, securities and similar items. This is especially true of collectible coins and currency having a special value that, usually, far exceeds their face amounts.

One standard homeowners program contains a severe restriction on the limits available for money. Specifically, it limits coverage to less than $300 for any loss which involves money, including currency and collectible coins. Insurers restrict coverage for coin collections and similar property because it is attractive to thieves, subject to fraud and counterfeiting, small in size but very high in value, and very vulnerable to destruction.

Coin collectors invest a lot into their hobby, so they should be encouraged to seek special protection. A collector has the option of adding additional protection to their basic homeowner protection or buying a separate policy. While arranging for coverage, a coin collector must meet several critical objectives. First, the collector must be able to prove ownership of the property. Second, the collector must use a reliable method that establishes the property’s current value. Keeping careful and current records is essential to making sure that a loss is properly covered. A collector should maintain current inventories of their collection. A written inventory is good, but it could be backed up by photos or even video documentation. The collector should also keep independent verification of coin values such as guides and, when warranted, professional appraisals. Finally, the collector must be clear about their coverage:

  • what is the total amount of coverage provided?
  • is the coverage for each individual piece or a single (blanket) limit for the whole collection?
  • what is the basis of loss settlement (actual cash value, guaranteed amount, replacement cost)?
  • are there any special storage or notification requirements?

It is very important to keep your insurer informed about any additions, removals or other changes involving your coin collection. If values have changed, make sure that you tell your insurer to adjust your coverage.

Collecting coins is a great recreation and it’s worth a collector’s time to make sure that their investment in it is properly protected.

Does Special Property Need Special Protection?-Part 2

Remind Me About Homeowners Limitations

In part 1, we told you that the typical homeowners policy contains substantial coverage limitations for certain types of property. The modest insurance protection affects property that is highly vulnerable to loss because it is targeted for theft and/or has a high level of value in relation to its size. Examples are gold, money/securities, precious metal-plated dinnerware, jewelry, furs, stamps, electronic property, business property, watercraft and firearms. How Do You Handle The Limited Coverage Situation?

You have to do something extra to your insurance program. Insurance companies are happy to provide more coverage, if they are paid for their trouble. Specifically, limited coverage can be handled using the following methods:

Increased Coverage C Endorsement – this form is only appropriate for property saddled with limited coverage for theft losses. This form is attached to a basic policy and it increases the theft insurance limit (ie. for jewelry from $1,500 to $5,000).

Scheduled Personal Property Endorsement – this form is used for increasing coverage for property that has protection reduced for all sources of loss. The property is removed from the basic policy’s limits and is covered exclusively by the endorsement. This form takes more work since each item of property has to be listed and assigned a particular insurance limit.

Inland Marine Property Floater – this method works like the personal property endorsement, except that it is a separate policy. This alternative is more appropriate for persons owning substantial amounts of high-valued property. The coverage must often be purchased from specialized insurers and comes at a high cost. In order to qualify for such coverage, you may need to meet special circumstances such as having a residential alarm system or make use of vault storage. Another Advantage Of Special Handling

In order to arrange coverage under a schedule or an inland marine policy, the property must be properly valued. This often involves appraising the property. It’s very helpful to have an expert source establish the current value of jewelry, furs or other valuable possessions. In fact, such property should be appraised every two or three years since their values often increase over time.

Do you still have questions about property that needs special handling? Talk to an insurance professional about your needs and make sure that you have proper protection.

Does Special Property Need Special Protection?-Part 1

Limited Coverage For Certain Property

The typical homeowners policy offers plenty of coverage for personal property, usually offering a limit equal to half of the amount reserved for the residence (ex. Your home is covered for $150,000, so your contents and furnishings are covered for $75,000). While this is generous coverage, it doesn’t extend to all types of property for all causes of loss. Certain types of property, because of its high value and liquidity, is far more vulnerable to loss…either easily destroyed, easily stolen or both. For instance, an insurer protects your sofa right along with your fur coat for the same basic premium, but the two types of property don’t represent the same chance loss. Recognizing this fact, insurers put more restrictions on the coverage provided by a basic policy. Theft Coverage Limitations

When property is lost due to theft, coverage under a standard homeowner policy is severely limited (generally between $1,000 – $2,500) for the following types of property:

  • jewelry, watches, furs, and gemstones
  • dinnerware, serving sets, trophies and similar property made of or plated with silver, gold, platinum or pewter
  • for firearms, accessories and related property

Other Coverage Limitations

Several categories of property are subject to very modest limits (generally between $200 – $2,500) of coverage, regardless of the cause of loss (theft, fire, accidental breakage, etc). Specifically:

  • money, bank notes, coins, medals, gold, silver and platinum (other than jewelry or dinnerware)
  • securities, accounts, deeds, tickets, stamps, manuscripts, passports and similar property
  • watercraft and related property including their trailers
  • trailers not used with watercraft
  • business property located in your residence
  • business property located away from your residence
  • certain types of electronic property (CD players, VCRs, TVs, radios, computers )and related accessories) which is lost or damaged while in a car or is located away from your home and used for business.