Jewellery insurance: What you need to know

When it comes to the items we treasure, jewellery will invariably appear somewhere on the list. From family heirlooms to gifts given to us by loved ones, through to items worn on those truly special occasions – the different types of jewellery we have in our lives can carry great meaning. Given that jewellery can be so valuable, we think another issue follows logically: protecting your jewellery with a quality insurance policy.

What insurance should I have in place to protect my jewellery?

Money from an insurance payout can’t fully compensate for the loss of a wonderful piece of jewellery but having the right insurance cover in place will at least help with the financial loss –whether that’s to fund a replacement, cover the cost of repair or restoration, or compensate you for any depreciation in value.

The insurance you need to protect your jewellery will depend on many factors – for example, the type of metal or the quality of the gemstones. Most standard home insurance policies will cover valuables up to a certain amount, but this varies policy by policy and may be less than your jewellery is worth.

Mid net worth and high net worth policies are designed to protect higher value contents. These policies can include:

• Higher single article limits for jewellery.
• “All Risks” cover. This means that there’s wider cover for more eventualities. Cover is usually worldwide unless otherwise restricted.
• Pairs & Sets Cover – if you damage an item that’s part of pair or set and a replacement can’t be found, the entire set will be replaced or compensated for.
• Accidental damage or accidental loss of your jewellery, including individual stones.
• Extended Replacement Cover. Some of the insurers we work with will give a 25% or even 50% uplift for a number of years after a valuation to help protect policyholders from rising prices.

Extended Replacement Cover - why is this important?

In the event of a claim there may be a shortfall in cover if the value of the item(s) have increased since a valuation.

Given that the price of diamonds and precious metals are particularly volatile – for example over the last five years the value of gold has risen by 78% - it is easier than you think to fall into the underinsurance trap.

It’s worth noting that if a claim is declined you will need to disclose it when applying for future policies. This may make it difficult to find home insurance or move providers. You can read more about this is our article: Is your claims history affecting your home insurance?

Valuations

To protect yourself from this we recommend that you get an up-to-date valuation. Not only will this prevent underinsurance but in our experience a claim is often settled much more quickly when there is an up-to-date valuation. It’s also worth noting that some values have reduced, particularly watches that may have been valued during the pandemic and are now worth less. In this case you may be paying more for your insurance than you need to.

• Make sure the valuation is for insurance purposes as opposed to an open market or probate valuation
• A good valuation will include a description, weight, size and a photograph, the date and the valuer’s name and credentials.
• Some valuation companies offer a walk-through service. This is where they value your contents and art and antiques room by room. An introduction to walk-through valuations
• We would also recommend, if valuing jewellery, that the valuer has a diploma from The Gemmological Association in London, is a Fellow of the Gemmological Association (FGA), has a diploma in Diamond Grading or a degree from the Gemmological Institute of America (GIA).

We have a panel of recommended valuation companies that can assist by not only valuing your pieces now, but by also giving you up-to-date valuations going forward.

“We see, on a daily basis, a high level of under-insurance. This is probably due to owners having busy lifestyles and not focusing on rapidly changing markets. More than 78% of clients we visit are underinsured. This can result in claims being only partially met or not at all.” Rachel Doerr – Doerr Dallas Valuations.

Does an increase in the value of my jewellery mean higher insurance premiums?

Your insurance premium is based on your sums insured and the most expensive thing to insure £ for £ is jewellery. However, there are still steps you can take to manage the premium.

• We often speak to new or prospective clients who have all their jewellery insured on a worldwide basis, all the time. This is often inappropriate and gives rise to a higher premium than is necessary. To find out more read our article: Floating Limits.
• Having a home safe is not only a great way to protect your valuables but it can influence your home insurance premiums. We appreciate that choosing a safe can be a bit of a minefield, so here’s some advice: Safety First – top tips for your home safe. Please note that any safe you choose will need to meet insurer requirements.

How Howden can help

Howden are specialists in finding the right jewellery insurance solution. This can range from a home insurance policy which covers a jewellery collection and other high value contents, to a stand-alone policy for a single piece.

To speak to us about the insurance you have in place for your jewellery call 020 8256 4901 or email privateclients@howdeninsurance.co.uk