Insurance is a means of protection from financial loss. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss.
An entity which provides insurance is known as an insurer, insurance company, or insurance carrier. A person or entity who buys insurance is known as an insured or policyholder. The insurance transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate the insured in the event of a covered loss. The loss may or may not be financial, but it must be reducible to financial terms, and must involve something in which the insured has an insurable interest established by ownership, possession, or preexisting relationship.
The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insured will be financially compensated. The amount of money charged by the insurer to the insured for the coverage set forth in the insurance policy is called the premium. If the insured experiences a loss which is potentially covered by the insurance policy, the insured submits a claim to the insurer for processing by a claims adjuster.
Renters insurance provides personal property coverage that covers your personal property – including jewelry – in case of theft, loss or destruction caused by a covered peril, such as a fire or a storm.
According to the National Association of Insurance Commissioners (NAIC), the average cost of renters insurance is an estimated $15 per month for $30,000 to $50,000 of property coverage with a deductible ranging from $500 to $1,000.
Property Protection Provided by Renters Insurance
At a very affordable price, a standard HO-4 renters policy covers your jewelry and other personal property against a long list of perils. For example, the standard HO-4 renters policy insures your jewelry in case of loss or damage due to smoke, vandalism or volcanic eruption.
However, a standard renters insurance policy does not cover your jewelry against losses from floods or earthquakes. If you live in an area that could be affected by these perils, you would need a separate policy or rider to cover your personal property against floods or earthquakes.
Tips for Jewelry Owners About Renters Insurance
When you buy renters insurance for your jewelry and personal property, you still need to take reasonable steps to protect that property. If your insurance provider determines that the loss or damage of your jewelry was caused due to your negligence or an intentional act, then your policy will not cover that loss or damage.
Standard renters insurance has a dollar limit on coverage for personal property. If you own jewelry, furs, antiques, electronics and other types of expensive personal property, then you may have a gap between the covered value and the actual value of your property. In this case, consider buying a floater insurance to get the additional coverage for your jewelry that you need.
