All that you need to know about insuring your jewellery

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Priceless heirloom neckpiece you inherited from your grandmother? Sparkling diamond engagement ring you received in the course of that romantic weekend? Well, they’re both in the safe, and you are content.In the safe need not mean actually safe. Unforeseen damage and losses do happen — and if they do, even though you may not be able to regain the cherished piece itself, you can at least get back an assured sum of money to temper the loss.

In short, please seriously consider insuring your precious jewellery. Now scroll down for our handy, easy-to-read guide to jewellery insurance.

Who will insure my jewellery?

  • Ideally, the retail jeweller you buy your jewellery from: Retailers nowadays provide insurance as an extended service. A standardised tie-up with an insurance company allows them to pay your jewellery insurance premium, on jewellery purchased from them, for the first year. This one-year insurance is usually a standard service — a goodwill gesture, if you like. After the first year is up, if you wish to keep the insurance, you can extend your policy with the insurance company directly.

  • Retailer acts as a channel, connecting you to the insurer:
    In case your retailer doesn’t provide insurance, it may instead have an exclusive tie-up with an insurance company, and offer complimentary service to help you through the process.
  • You can also choose your own insurer, directly: Look up policies and companies on the Internet. There is a wide range of choices. Some websites help you compare policies across insurers, and select the policy and company that suits you best.

How much should I expect to pay?

Your premium will be set according to the final invoice for the jewellery you wish to insure. When routed through your jeweller, the premium usually amounts to 0.01–0.06 per cent of the billed amount. Rates differ from policy to policy depending on the kind of coverage and the tenure (that is, how long it will last). Thanks to their bulk tie-ups with insurance companies, retailers can offer you a subsidised yearly rate of premium.

If you approach an insurer directly, you will be asked to pay the standard rate, which is 0.6–0.7 per cent of total invoiced value.

Can I get an old piece of jewellery insured?

Most retailers do not have the provision to do it even if they have sold it to you. Insurance companies, however, do cover old jewellery. They will give you a list of approved jewellers who can value the piece you wish to insure. Your premium will be settled on the basis of the valuation certificate. You must use one of the insurer’s approved jewellers to get an acceptable valuation.

What will my policy cover?

A typical basic jewellery insurance policy covers the following risks.

  • RSMD (riot, strike, malicious damage)
  • FST (flood, storm, tempest)
  • Theft
  • Robbery
  • Fire
  • Earthquake
  • Terrorism
  • Loss in transit

Do note that the cover is generally premises-specific and people-specific. This means thatyou must tell the insurer:

  • Where your jewellery will be kept. This means home or bank locker or wherever else, with complete details. In case of a transit policy, where the piece is going.
  • The names and details of people who might use or handle the insured jewellery.

Certain policies also cover alarming eventualities like these:

  • Your original jewellery is stolen and replaced with a fake piece by a retailer who has taken your piece for a scheduled repair or polish.
  • You mortgage your jewellery for a gold loan, and a damage or loss happens while the piece is in the loan-giver’s custody.

What will my policy not cover?

There are always exclusions. Broadly speaking, an insurer will not extend coverage to instances in which you, the policyholder, are at fault. For example:

  • A piece of jewellery breaks because of negligence.
  • A piece is lost because, say, you left it unsecured and then filed a “lost” complaint.

A claim is judged on the basis of the FIR (first information report) that you will have to file after any loss or damage, at the appropriate police station.To file this kind of FIR, please remember that you will have to show the police officers your jeweller’s invoice for the jewellery.

What if I want to travel with my jewellery?

Please insure your jewellery if you plan to travel with it! To access this special contingency cover, the insurance company will ask you to list your travel dates; your coverage will be valid only during that precise period. Be prepared to furnish details about how you will travel and where you will stay.

Your travel insurance will cover your jewellery against natural calamities, theft, robbery, transit risk for your travel to the destination, and for the duration of your stay there.

Beyond the standard exclusions on breakage and loss due to carelessness, there will be other conditions. For example, if your jewellery is with you in a hotel room, you may be required to use a locker, and otherwise never leave it unattended.

Since thiscoverage is for a short period but with high risk, you will be charged a higher premium than for your annual policy. As it is contingency coverage, expect to pay a premium amounting to about 1 per cent of the total invoiced value of your jewellery.

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