Coverage for one-of-a-kind jewelry

“OK, so when my [fiance] proposed, it was in the classic blue Tiffany box and I couldn’t believe it,” anonymous user WolvLove posted on the bridal forum WeddingBee. “…We know he paid a bit of a premium to have it from there but decided it was an investment and wanted the service, etc. Now the issue is insurance.”

It’s one of the most famous jewellers in the world, but there’s affordable Tiffany, and then there’s max-out-three-credit-cards Tiffany. A simple silver chain costs just $80 and still gets you a “Tiffany blue box” (the term is trademarked). Engagement rings, on the other hand, start at $11,000, and homeowner’s policies may cap contents coverage at much less, though adding a rider can increase the limit. But those policies don’t always guarantee that if you lose the ring, you’ll get another one from Tiffany.

“Our concern is,” WolvLove continued, “heaven forbid, if something happens to the ring and they replace it with a like-diamond and a band but from another jeweller and we’ve lost the premium we paid for the Tiffany customer service for life.”

And it’s not just for Tiffany. “When you’re paying good money for something, you’re paying for specific things” such as service, says Janece White, a personal lines vice-president at Chubb who specializes in jewelry, “…whether it’s a Tiffany, a Winston, or even if it’s just a local jeweller who you actually adore because of the way they treat you.”

Some insurers keep that in mind. Jeweler’s Mutual, a Wisconsin company that works with brokers throughout Canada except for Quebec, pays the client’s chosen jeweler in the event of a loss—a good many insurers insist on their own choice of jeweller (which likely won’t be Tiffany).

“Our goal is that your new piece should be indistinguishable from the original,” spokesperson Jessica VandenHouten wrote in an email. Unless, of course, the client chooses to upgrade her jewelry, in which case she simply pays the difference to the jeweller.

Chubb is more direct. If there’s a covered loss for a scheduled piece of jewelry, they simply send the client a cheque. “So if I insured it for $5,000, I’m going to get $5,000 so I can go back to that iconic brand company and I can replace the item or I can go to a local jeweller that I like and I can buy a totally different item,” says White. “Or I can keep the money and go to Acapulco. That’s my business.” And if a ring hasn’t been appraised in some time and is lost while underinsured, Chubb will pay up to 150 percent of its value “with verification that’s what it cost to replace the item.”

JMI premiums range from one to two percent of the jewelry’s value; at Chubb, they can reach two-and-a-half, depending on where the insured lives and what home security she has, among other factors. Ultra-expensive necklaces kept in a bank safe, however, may be eligible for bank rate premiums—roughly 0.3 percent of their value.

If a Chubb client loses just one earring, they can either claim a cheque for half of the insured amount or turn in the other earring for the full amount. Chubb sells all those lonely earrings to salvage companies that retool them into new jewels. “It helps us get back some of what we may have lost,” White says.

And you could have lost your earring—or e-ring or necklace or brooch—doing anything: both Chubb and JMI honour mysterious disappearances. “I always tease and say there’s no foolishness clause,” laughs White. “…Let’s just say, and we’ve had this, where a customer had a very expensive diamond ring, and they’re dragging their hand through the water while they’re in a boat. And the ring came off in the water. It’s covered.”

A few losses, however, aren’t covered: fraud, nuclear radiation, government confiscation, military action and damage by vermin. Make sure your clients buy mouse traps.

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Copyright 2015 Rogers Publishing Ltd. This article first appeared in the December 2015 edition of Canadian Insurance Top Broker magazine

This story was originally published by Canadian Insurance Top Broker.