Do you have valuable stuff? There is a giant misconception for most policy owners that ALL of their personal property is insured under their homeowners, renters, condo or dwelling policies. Almost all of your personal property is insured under your homeowners policy, however, most valuables have sublimits that leave you severely underinsured.
What coverage is built into your homeowners policy for valuables? How can you protect your valuable items appropriately? Consider either scheduling your valuable personal property on your homewoners policy via a scheduled personal property endorsement or add a personal articles floater (PAF) to your policy.
A scheduled personal property endorsement itemizes valuable items on your homeowners policy and extends the policy’s coverage to the items. Usually, your carrier will require a bill of sale or appraisal upon scheduling the items.
A personal articles floater is either a separate policy or a rider added to your homeowners policy, depending on your carrier. A personal articles floater is considered a separate policy for your valuable items and is a TRUE ALL RISK policy. Additional perils such as theft, accidental loss or accidental damage, etc., are covered under your PAF and are excluded under your homeowners policy and its endorsements.
What should be covered under a Personal Articles Floater (PAF) or Scheduled Personal Property Endorsement?
- Artwork including statues, paintings, rugs, vintage furniture, etc.
- Cameras & video equipment
- Computers & electronics
- Musical instruments
- Sporting equipment
- Stamps & coin collections
- Silverware, goldware and china
What coverage is included in my basic homeowners policy?
Typically your homeowners policy will cover your valuable items anywhere from $500 to $2500 and may include a deductible. The homeowners policy will only protect these items against the perils included in your policy such as: fire, smoke, vandalism, explosion, etc. Because these sublimits are so low, it is important to discuss options with your Broker or Agent to protect these items.
Why use a personal articles floater vs. a scheduled personal property endorsement?
The main reason why you should choose to purchase a personal articles floater is that it offers additional coverage not offered by the scheduled personal property endorsement. Accidental loss or damage is a key coverage that under the personal articles floater. A missing stone in an engagement ring or missing jewelry down the drain or sandbox would be covered under a personal articles floater.
Depending on the carrier, your will need to have your items appraised or supply a bill of sale to determine the replacement value. Some carriers may also offer blanket coverage.
How to buy a personal articles floater?
Follow these steps to make sure you’re buying the proper policy for insuring your jewelry and other valuables:
- List your valuables. If you have a collection of valuable items you would like to insure, provide a list of these items to your insurance agent. The list should include a description of each item and their appraised or purchased value. An appraisal is typically acceptable if it was done within the past 3 to 5 years. (But be sure to keep your appraisals updated if you’re considering switching policies.)
- Check your policy provisions for newly acquired property. What happens if you buy a new piece of artwork or jewelry after the policy is in place? Make sure you understand what you have to do to get it covered under your policy.
- Is there a deductible? Ask your agent if the personal articles floater has a deductible and if you can adjust the size of the deductible to minimize the premium cost.
- Keep photos or video of your valuable items in addition to appraisals and proof of purchase. You’ll need these in case you file a claim, so be sure you keep them in a safe deposit box or scan them and keep several electronic copies in different locations.
- Consider installing an alarm system in your home. Increased home security should translate into a discount on the premium.
Can you store your jewelry and other valuables off-site? If the items can be placed in a bank safety deposit box, this will also qualify for a significant savings on the policy premium.
-Jacob Pullen, CIC-
Pullen Family Insurance Agency