In homeowners policies, there is a limit designated specifically for contents coverage, which is a default percentage of Coverage A. While this limit can be increased or decreased, it is important to differentiate the value proposition associated with scheduling certain valuable items and not relying on the contents limit.
Certain types of personal property have limitations for coverage. Those items include but are not limited to jewelry, firearms, antiques and artwork. For example, many policies only provide $2,500 for lost or stolen jewelry. Items that exceed the threshold the company sets for certain items can be added to the policy by endorsement to establish a value to be used at the time of a loss. However, while certain carriers give stated value at the time of loss, others give repair/replace value which could be less than the stated value.
Whether the articles are family heirlooms or investments, an insured with scheduled items gains the advantage of essentially “all risk” coverage, although some exclusions may apply. For example, the loss of a precious stone from a ring that is scheduled is covered. Other benefits of scheduling items are no deductible and for some valuable articles policies, newly acquired items automatically covered for 90 days under certain conditions. For example, Chubb’s terms are up to 25 percent of the total scheduled value for that class of articles not to exceed $50,000. Another feature of some valuable articles policies is that under certain conditions, if at the time of the loss the cost to replace the item is greater than the stated value, some insuring carriers may provide up to 150% of stated value for the replacement of the item.
The trend in collections should also be considered in a review of coverage. In a recent article posted by Chubb insurance company it was cited that 10% of wealth has been allocated towards “investments of passion”such as Jewelry, Fine Arts, Wine, Antiques and other collectibles.