Matt Hands, VP, Insurance and MoneySense
This post was first published on June 15, 2019, and was updated on November 16, 2023.
Diamonds are forever – until your engagement ring slips down the drain while you’re washing dishes, or a thief swipes the necklace your grandmother left you. Jewellery insurance is available on your homeowners, condo or tenants insurance policies, and while limits will differ, they likely won’t cover much.
Standard coverage is minimal, often capping the reimbursement for jewellery, watches and furs to between $3,000 and $6,000 for all your belongings in that category. The Co-operators, for example, have a $6,000 maximum, with a $4,000 maximum for any one item.
If you have a substantial jewellery collection or even one watch with a lot of sentimental value, it makes sense to buy an endorsement on your home insurance policy to make sure the gems are covered.
How much is jewellery insurance?
Premiums for jewellery endorsements typically cost between 1% to 2% of the insured item’s value; so, for example, insuring the engagement ring your fiancé bought for $8,000 could cost between $80 and $160 each year.
Endorsements for jewellery and watches typically cover the item’s replacement value, which often increases over time. Your insurer will require a recent appraisal in order to provide coverage.
How to get an engagement ring insured
It begins with a detailed receipt and description of the purchased jewellery. Then, you’ll want to obtain an appraisal from a member of the Certified Accredited Appraiser Program (CAAP), according to the Canadian Jewellers Association.
Keep the appraiser’s report on hand – it should include a detailed description, magnified photographs and a current replacement cost estimate, and comes in handy if you need to make an insurance claim. It doesn’t hurt to take your own photos, too. If you are going to the extent of insuring your engagement ring, you should include all jewellery in your home inventory, and keep the receipt. Also, if you bought the piece on sale, you’d want an appraisal so it’s not under-insured.
You’ll gather up your home inventory and submit everything to your home insurance provider. If you’re renting, shop for tenant’s insurance quotes, and see which policy offers you the best value.
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Alternatives for jewellery insurance coverage
Stuffing it under your pillow may not be the best move. You can buy a safe that would protect your jewellery in a fire or flood and deter thieves, but jewellery is meant to be worn. If you’re searching for alternatives, know that you can buy separate coverage for your jewellery on a separate policy. It can be more expensive, but if you have to make a claim, premiums for your main home insurance policy won’t be affected.
If you move, your brokerage should be able to carry your coverage over, in most cases – but it’s important to double-check just in case the coverage does lapse upon moving to a new location.
Whether you add an endorsement to your home insurance or shop for a new policy, check to see what’s covered. Maybe the policy will kick in if your ring is damaged but not if you lose it. According to a policy from Aviva Insurance, jewellery, watches and furs are insured up to $6,000 in total, but 11 exclusions are in place. These include fire, lightning, riots — and theft.
On the other hand, an individual jewellery policy from Jewelers Mutual, for example, kicks in whether you lose an earring, a stone falls out of a ring, and even mysterious disappearances. That’s when you just don’t know what happened to a piece of jewellery. Maybe you forgot to lock the front door or maybe your least-favourite cousin “borrowed” it. So even if you have suspicions but no proof, the policy will pay out.
It’s also a good idea to check if there are any restrictions on how the claims process works. Some home insurance companies require you to use a jeweller of their choosing to fix damaged items or to recreate lost or stolen items. Others are much more flexible: Chubb, for example, simply sends successful claimants a cheque. The policyholder can buy the exact same necklace, a completely different piece of jewelry, or keep the money to do whatever they want, like investing it in a high-interest GIC.
Who insures jewellery?
We’ve mentioned The Co-Operators, Jewelers Mutual, Chubb, and Aviva insurance in this article. Each one can insure jewellery, but at what price and with what exclusions? Your first call should be to your current home insurance provider (e..g. TD, Intact, RBC, etc.) to see what it might cost to add your new ring to the contents insurance portion to your home insurance policy.
The bottom line
The standard contents coverage on your home insurance policy typically comes with a cap, and if you have a large jewellery collection, it may not be enough. Instead, you'll want to seek out options for extended jewellery insurance – which can include adding an endorsement to your home insurance plan or purchasing an individual policy from a specialized provider. With any option you choose, make sure you're aware and comfortable with all the terms and restrictions.