logo logo

Buying Extra Insurance Coverage

gb-1A small fire breaks out in your den, destroying your set of golf clubs. The bag was made of Corinthian leather and would normally cost $1,000. However, you had this bag custom made with gold feet, engravings, and a Jack Nicklaus autograph. Buying extra insurance coverage just might be the right thing to cover its loss.

The bag cost $7,244.99 and you file a claim to get that amount back from your insurance company.

However, because your bag was not scheduled personal property, your insurance company will probably only pay you $1,000, which is a reasonable replacement cost for a normal leather bag.

The decision to schedule or put an individual item rider on your personal property coverage is usually just a matter of arithmetic. Add up how much it would cost to replace your stuff with new stuff. Compare that number with the number designated for personal property on your homeowners or renter’s policy. If the second number is bigger than the first number you’re good to go, no extra coverage necessary.

While this method is proven over time there are occasions when you may want to be buying extra insurance coverage that comes with scheduling. WiseInsuranceQuotes.com found the best reasons to get extra coverage. Cover Your Valuable Items with Extra Homeowners Insurance. Search for Rates

1.) Named Peril Homeowner Coverage: If your homeowner policy is “named peril,” the list of covered events is markedly smaller than all-peril policies. When a named peril coverage policy is written, the insurance company creates a list of “perils,” potential causes of damage or loss. These perils are clearly listed in the policy, along with a clause indicating that unlisted causes of damage will not be covered.

Some homeowners choose this kind of coverage because the premium paid is much less than what will be charged for an all-peril policy. If you are that guy/girl you should consider scheduling (extra) coverage for your most treasured items.

2.) Investment and Appreciating Items: You have a rare book collection or that elusive Honus Wagner tobacco sponsored baseball card? Count yourself lucky indeed! The value can be expected to grow over time. Since the value of a scheduled item is set by the policyholder, an argument with the insurance company about how much your item is worth, (a scrap that you will likely lose), is avoided by scheduling the item in the first place.

Remember, the insurance company doesn’t love your antique flute as much as you love it. Keep track of the going rate at memorabilia auctions and be sure to update your policy as the value of your treasure grows. Remember, the insurer will pay the LESSER of the actual cash value of the item and the amount of coverage that you specified on the rider. This is particularly important for jewelry and furs, as these are limited to only $1,500 in coverage for theft under the homeowners form. That little “get out of trouble” necklace that you bought the day AFTER you forgot your last wedding anniversary is probably worth more than that.

The following types of property can be scheduled for extra insurance coverage:

• Jewelry
• Furs and garments
• Cameras and related items
• Musical instruments and related items
• Silverware and related items
• Golfer’s equipment
• Fine Arts
• Postage stamps
• Rare and current coins

bottom