Don’t Settle for Less: Why Jewelry Replacement Insurance Outshines Reimbursement

For this article, we’re taking it from the jewelry insurance experts and our trusted partner, Jewelers Mutual.

While most insurance policies rely on reimbursement, jewelry insurance offers a more desirable option: replacement. Here’s a breakdown of both approaches and why replacement holds the key to your peace of mind.

Reimbursement: A Common Approach, But Not Always Ideal

Traditional insurance, including jewelry coverage under homeowners’ policies, typically operates through reimbursement. Here’s the basic flow:

1. You pay for coverage.
2. You file a claim if your jewelry is lost, stolen, or damaged.
3. The insurance company assesses the claim and determines your payout.
4. You receive a check.

However, the payout amount is the crucial factor. Your compensation can be based on:

• Actual Cash Value (ACV): Your payout reflects the item’s depreciated value, leaving you responsible for any remaining replacement cost.
• Replacement Cost: You receive the amount needed to replace your jewelry, regardless of depreciation.

Replacement Cost

Jewelry’s unique nature makes replacement cost insurance highly favorable. Unlike depreciating assets like cars, jewelry’s value often remains stable or even appreciates (with the exception of lab grown diamonds). With replacement cost coverage, you’ll receive the amount required to replace what you insured, at the time you insured it. ACV has more grey areas and may even leave you with extra out-of-pocket expenses after a claim.

The Advantage of Dedicated Jewelry Insurance

Specialized jewelry insurance like Jewelers Mutual takes replacement a step further:

• Freedom of choice: We won’t limit you to working within a small network of jewelers. Choose to work with your preferred jeweler in the event you need a repair or replacement.
• Expert guidance: We employ jewelry specialists who understand the intricacies of your piece and can assist in finding a perfect match.
• Direct communication: We’ll handle the process directly with your chosen jeweler, ensuring efficient and hassle-free resolution.

Don’t Leave Your Valuables to Chance

Understanding your insurance policy is crucial, especially when protecting precious possessions like jewelry. Consider your needs and preferences to determine if replacement-focused jewelry insurance is the best fit for you.

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Source: Jewelers Mutual

Coverage is subject to underwriting review and approval, and to the actual policy terms and conditions. Any descriptions are a brief summary of coverage and are not part of any policies, nor a substitute for the actual policy language.

Coverage is offered by a member insurer of the Jewelers Mutual Group, either Jewelers Mutual Insurance Company, SI (a stock insurer) or JM Specialty Insurance Company.  Policyholders of both insurers are members of Jewelers Mutual Holding Company.