If you’ve been shopping for jewelry any time during the past few years, the chances are you developed a bad case of sticker shock when you looked at the prices of gold jewelry, but what you’re probably unaware of are the implications for those of you who already own fine jewelry. One of the most important aspects is insurance, because, in most cases, jewelry purchased just a few years ago now has a replacement value that far exceeds its purchase price. This is great when you consider how much money you saved by buying when you did, but replacing an item that has been lost or stolen will be another matter entirely, whether or not your jewelry was insured.
Gold now costs approximately four times what it did in 2005, so the necklace you bought seven years ago for $275 would cost more than $1,000 to replace today. Most people won’t include something costing under $500 on their insurance policy (although they really should), so if it were to become lost or stolen, they would be out of luck — but even if it had been insured, the amount of money they may receive from an insurance company (only a few years after the purchase) will pay just a fraction of the replacement cost.
Most homeowners’ insurance has a provision for jewelry, and, up to a point, this costs you nothing extra, but this insurance does you no good whatsoever if your insurance company does not have your jewelry listed on your policy. Not sure of what the current value of your jewelry is? Join the club.
As a general rule, your jeweler will be able to give you a “ball park” replacement value, and it then becomes your decision whether to insure it or not. If you do, you will need to have a current insurance appraisal, and even if it’s a new piece, it’s rare that a bill of sale will have a description that is detailed enough to be effective for insurance purposes. “One 14 kt yellow gold bracelet, $400” is not even close to being adequate, because without having far more information, this could describe almost any gold bracelet. Besides, in the event of a loss, your insurance company may not be sending you a check at all, even if the piece was insured. Frequently, they will have the option of simply replacing the piece, and if it was not described sufficiently, the chances are that you will not be happy with the result.
Joe Brandt, a local resident, is a consultant to retail jewelers and provides advisory services to the public. His company (J.L. Brandt Company) has been in business since 1928. He is the author of the book Protecting the Family Jewels. Questions may be addressed to JLBCO@hotmail.com.
