When you get homeowners insurance, it should give you some peace of mind.
It’ll protect the things you cherish if they happen to get stolen, damaged, or destroyed by a covered peril. That means your home and your personal items inside it are protected from fire, theft, and more.
With personal property coverage, it typically comes with limits for both overall coverage as well as a limit for certain high-value items.
The limit you choose might not be enough to cover your valuables and that’s where an insurance rider comes in handy.
What’s covered under a standard homeowners insurance policy?
A standard home policy includes coverage for your personal belongings.
This includes items such as:
- Home decor
- Sporting goods
- Children’s toys
- Wine and spirits
But for your high-valued items, it’s a different story.
A standard homeowners insurance policy provides some coverage for jewelry, furs, antiques, artwork, etc. But most policies will only cover these things up to an assigned dollar limit. And generally, that limit is pretty low.
You can always increase the overall coverage limit as well as limit for your high value items under a standard policy.
But keep in mind that there are still restrictions as to what you can claim. And it’s different for individual pieces and overall losses.
What’s an insurance rider?
An insurance rider—also known as an endorsement or a floater— is an optional add-on to your insurance policy.
It provides extra coverage for the items you own that are worth more than the per-item limit of your homeowners (or condo or renters) insurance policy.
An insurance rider also helps to protect these items from a greater number of risks. It’s not limited to the named perils in your standard policy. If you lose an item, it’s covered under an insurance rider.
Another perk? You typically don’t have to pay a deductible.
What kind of items are covered under an insurance rider?
- Jewelry: wedding and engagement rings, necklaces, watches, earrings, anything diamond, etc.
- Personal collections: fine art, coins, stamps, etc.
- Specialty items: bicycles, cameras, musical instruments, and more.
How do I add an insurance rider to my policy?
If you already have homeowners insurance, the process of adding an insurance rider is pretty easy.
Contact your insurer and tell the rep about the high value items you want covered. Depending on what you’re looking to get coverage for and its value, the insurer will ask for a professional appraisal and photos of the pieces before you can buy an insurance rider.
If you currently don’t have home insurance, don’t worry. It only takes a few minutes to get a quote. When you do, you can opt to add a floater policy.
Take a look at our handy guide if you don’t know where to start with shopping for home insurance.
An appraisal? How do I get that done?
For your valuable items, an appraisal is more than likely needed. How much each piece is insured for is completely dependent on its value at appraisal. It’s not based on what you paid for it at retail price.
An appraisal states the value of the item. It contains a detailed description of the piece. For example, if you’re getting an appraisal for your jewelry, it’ll come with a description of the stone’s clarity, cut, and metal quality.
Once your items have been appraised, give a copy of the appraisal document to your insurer. This’ll come in handy if you have to file a claim.
If you want to make sure your items are properly insured, make sure you get your valuable items appraised every two to three years. Market fluctuations for things can cause your item’s value to increase or decrease.
Who do I go to get an appraisal from?
Make sure you go to a reputable appraisal firm. The best way to do this is to ask your insurance agent for recommendations.
Or you can look into some of the biggest appraiser organizations: The Appraisers Association of America (AAA), American Society of Appraisers (ASA), or the International Society of Appraisers (ISA).
What’s the cost of adding an insurance rider?
It really depends on what you’re insuring. The price for a rider will vary based on the item, appraised value, and the company you buy from.
But overall, riders are affordable. For jewelry, it’s about 1 to 2 percent of the piece’s overall value.
Let’s say you’re insuring your engagement ring. If it costs $10,000, it would cost $100 to $200 to insure it a year.
How do I know if I need an insurance rider or not?
Regardless of whether you’re going to get an insurance rider or not, you should make a home inventory list. It’s a catalog of items or personal belongings you have in your home, condo, or apartment.
Taking a home inventory, from time to time, can be beneficial even if you think you’re adequately covered. You might be surprised by what you’ll find after taking stock of everything you own.
It ensures that you don’t miss any items to claim and helps to determine if you have enough insurance. And you can also organize the list by items you need to get appraised.
If you see that you have enough items to warrant adding an insurance rider, then you should contact your insurance company to move forward with it.
Is it worth it?
Adding a rider is typically worth the extra little bit that it costs. It provides higher coverage, no deductible, and additional loss coverage. Your wedding ring just mysteriously disappeared? It’ll be covered under a rider.
And at the end of the day, it means that you’re paying just a tiny bit extra on your policy to cover an item that has high value to you.