When you think of the holiday season, what comes to mind? We think of hot cocoa, snowmen, time with family, and of course, gifts! Giving gifts is one of the most rewarding parts of the holidays, but can come with a fairly hefty price tag. If you're planning to gift yourself or someone in your home jewelry, firearms, fine art, antiques, fur, or anything that holds a substantial value, you should consider scheduling personal property.
What is Scheduled Personal Property?
This type of coverage can be added to your homeowners' insurance policy and is beneficial when your valuables exceed the Special Limits of Personal Property provided. These limits are set forth by the insurance company and define the amount of money they are willing to pay out for specific types of personal property, depending on certain losses, like theft.
What are the Benefits of Scheduling Personal Property?
At the most basic level, scheduling personal property raises your limits on certain defined items so that you're more protected from loss. In addition, you can expect:
● No deductible. That's right! Most insurers don't require a deductible for scheduled items.
● Broader protection. By scheduling, you broaden the range of risks that will be protected under the policy. For instance, the accidental loss of an heirloom piece of jewelry would then be covered. Coverage is often broadened to include the mysterious disappearance of your valuables.
● Agreed value is normally available. An insurance company will agree to insure the item to a specified amount, which is what you will be paid at the time of a loss. Agreed value is usually based on an appraisal or purchase receipt.
Examples
Examples are a good way to highlight the benefits of scheduling an item, as well as showing the limitations on the policy without scheduling. Following are two examples of commonly scheduled items.
- $10,000 Engagement Ring
- If it's unscheduled and destroyed in a fire, there is no coverage limitation and the full Contents limit can apply. Without an appraisal, you may not get an exact replica of the original ring.
- If the unscheduled ring is stolen, on an unendorsed homeowners' policy, coverage is limited to $1,500.
- If the unscheduled ring slips off your finger at the beach (i.e it mysteriously disappears) there is no coverage.
- If the ring is scheduled with a limit of $10,000 and it slips off your finger at the beach, you have up to $10,000 to replace it. And, you likely used an appraisal to establish the limit, which means there is an accurate description so the new ring is similar to the original.
- Antique desk
- Let's say you have a William Kent 1740, Thomas Chippendale, twin pedestal double sided partners desk that you bought at an antique store while on vacation at the Finger Lakes.
- If that desk is not scheduled, and destroyed in a fire, the insurance company would replace it with a new desk. But, you obviously didn't want a new desk or you would have gotten one from Ikea.
- If the desk was scheduled, your insurance company would replace it with a desk as similar to a William Kent 1740, Thomas Chippendale, twin pedestal double sided partners desk as possible.
What Types of Loss and Damage are Not Covered?
When you schedule coverage for a piece of personal property, it will be protected against more than the typical causes of loss as defined in a standard homeowners' policy. While this covers a lot of instances, the following are still not covered:
● Gradual deterioration
● War
● Nuclear disaster
It's important to note that there are certain types of property that may have exclusions specific to them.
How Should You Schedule Personal Property?
We suggest following these steps:
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Take a home inventory to determine what you have, what it's worth, and how much, if any, you should be compensated in case of loss.
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Get your property appraised so you can provide your insurer with proof of value.
- Get in touch with your agent to understand any limits and secure your coverage.
As always, if you have any questions or would like to plan ahead in scheduling your big holiday gift, don't hesitate to reach out to your agent. We are here to help!
Legal Disclaimer. Views expressed here do not constitute legal advice. The information contained herein is for general guidance of matter only and not for the purpose of providing legal advice. Discussion of insurance policy language is descriptive only. Every policy has a different policy language. Coverage afforded under any insurance policy issued is subject to individual policy terms and conditions. Please refer to your policy for the actual language.