According to the FBI’s latest statistics, property crimes in 2015 resulted in more than $14 billion in losses, and the total value of stolen property, including precious items like jewelry, was more than $12.4 billion. If you own your home, you might be surprised to know that your standard homeowner’s insurance policy won’t necessarily cover the loss of your most expensive possessions.
If you want to completely protect your prized possessions from events like natural disaster, fire, vandalism, or theft, you have two options for increasing your standard insurance coverage and three options to ensure their physical safety:
1. Raise the limit of your home insurance plan’s liability
Increasing your homeowner’s liability limit is the cheapest option available for protecting your valuables. To keep coverage plans affordable, standard homeowner’s insurance typically only covers about $1,500 worth of valuables when it comes to liability for theft. If you raise that limit, you can protect more value. But the policy may still restrict how much money you can claim per piece. For example, you still may only be able to claim $1,500 on a piece of jewelry even though your overall policy limit is $5,000.
2. “Schedule” your individual items by purchasing additional coverage or “rider” policies
Adding a rider to your homeowner’s policy will provide you with broader coverage, though you may end up paying more in premiums. Riders are add-ons that provide supplementary benefits at an additional cost, and they cover all types of losses, including accidents. While a standard homeowner’s policy wouldn’t cover your diamond ring if you accidentally dropped it down the drain, a rider could.
Riders are also used to cover items whose individual values exceed the standard $1,500 limit that’s typical of homeowner’s insurance. Fine jewelry, art, antiques, sterling silver, firearms and high-end sports equipment (like golf clubs or scuba gear) are typical items covered by insurance riders. Before you take out a rider on any item, you must have it professionally appraised.
3. Store your valuables in places burglars aren’t likely to look.
According to the International Association of Certified Home Inspectors (NACHI), hiding valuables in hollowed-out books, false wall outlets, and even inside house plants can keep thieves from finding them. Avoid the natural inclination to keep pricey or sentimental items in your jewelry box or bedside drawer, because storing these things in obvious places can compromise their safety.
4. Guard against natural disasters.
Your precious items can get damaged in the event of a flood, earthquake, or other natural disaster. Identifying your most valuable pieces and taking simple low-cost and no-cost measures can provide added protection. Start by creating a photographic record of your valuable pieces and store the files in the cloud or on a flash drive outside of your home so you have evidence to give your insurance company in the event of a loss. And if your valuables are stored in the basement, consider moving them to a higher location in your home to prevent possible water damage.
5. Protect your identifying information, too.
If your items are stored in a safe-deposit box, don’t keep identifying information on or near your key (that includes the name of the bank where the box is located, or the box number). If a burglar gets a hold of your keys, he’ll know exactly where your safe-deposit box is.
Pro Tip: Home safes can be great for storing important documents, but they’re not ideal for precious items like jewelry or collector’s items. To keep those as secure as possible, invest in a safe-deposit box at a bank, which offers better protection. However, if you need regular access to certain jewelry, coins, or other valuables, then a home safe may be best. Taking the right preventive measures to safeguard your valuables can spare you from future heartache in the event of a natural disaster, theft, or unforeseen damage. By arming yourself with all the information available, you’ll be empowered to make a decision that eases your mind and keeps your most valued possessions as safe as possible.