For many people a diamond ring is one of the biggest purchases of their lifetime, so it is important that you protect your investment. One of the most popular ways to protect your investment is to insure your diamond. There are three types of diamond insurance that are conveniently offered, here are some tips.
Usually many types of jewelry including diamond rings are covered under your homeowner’s policy, but this only covers you from losing your diamond or having it stolen from your home. If you wear your diamond ring, you should option for a scheduled personal property policy. This way your diamond is usually covered if lost or stolen at home or away from it.
Three types of policies that are offered are:
- Actual Cash Value, in which the insurance company will give you the actual market value of the diamond in order to replace it.
- Agreed Value, which is a very rare type of policy, in which the insurance company and you the owner, will negotiate on the proper value of the diamond ring or stone.
- Replacement Value, which is the most common of the three. This is where the insurance company will reimburse you up to a specific amount agreed upon by the two parties when the policy was created.
For instance, with a replacement value policy, if you spent 10K on a diamond ring, and the appraiser has confirmed the ring is worth 10K, the insurance company will insure you with a replacement value policy of up to 10K. If the ring is lost or stolen in the future, the insurance company will usually pay up to 10K for the ring.
In order to have your ring insured, you will first need to have it appraised and to send a copy of the professional appraisal to your insurance agent. Besides an appraisal, your insurance agent may request photos of the ring and stones and possibly a gem print which is a computer scan of your diamond ring which makes it easily identifiable if it is stolen. If you are planning on buying a diamond ring or own a diamond ring that is extremely valuable, look into the above tips on insuring it.