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“Could someone help me to decide what I should schedule?”

October 5, 2002

For an additional premium, you might opt for the broader coverages of a valuable articles endorsement or policy for your fine arts, wine and collectibles, as well as jewelry and silver. Each item is listed with a value, hence the term “scheduling” the items. An alternative to scheduling each item is to select blanket coverage (items are not listed separately). This is an attractive option if you have a collection with many items of a relatively low value (like wine, stamps or china) or if you prefer not to insure the majority of your jewelry. Instead you determine the maximum amount of jewelry that might be stolen at one time and make this your blanket limit. You have a greater burden of proof because the values are not agreed to in advance so you must have good documentation.

Advantages of a Valuable Articles Policy.

1) No deductible applies in the event of a loss and there is usually swift claim settlement since the value is agreed upon in advance.

 2) Change in value resulting from a partial loss (usually only available from AIG, Chubb and Fireman’s Fund).

3) Market Value Protection. If the market value of the items has appreciated, the insurance company will pay up to 150% of the agreed value of the item, (usually only available from AIG, Chubb and Fireman’s Fund).

4) Newly acquired items. Protection for 90 days for newly acquired items (usually only available from AIG, Chubb and Fireman’s Fund).

5) Breakage and loss resulting from temperature change are often included.

Jewelry

Most insurance policies limit unscheduled jewelry coverage to $5,000 or less. Some insurance companies reserve the right to settle the claim at market value even if you have scheduled the item at a certain value. Other companies allow the insured the option (rather than at the insurance company’s discretion) of a cash settlement instead of requiring that a replacement is purchased. Some insurers allow the replacement to be bought from any jeweler; others may require a jeweler to be used that has an “arrangement” with the insurer. Another distinction between policies is broad “pair and set” coverage where the insurance company will repair or replace based on the value for the full pair, even if only one item of the pair or set is lost.

Fine Arts

Some insurance policies will only settle fine arts at “actual cash value [ACV]” unless the items are scheduled separately. For example, an 18th century grandfather clock would be settled at the price of a newly made reproduction. Broader policies will settle fine arts at “replacement cost” but if the item is not scheduled, the burden is on the insured to prove the value of the item. Also items that might be damaged from the following perils that are normally excluded from most homeowners policies – accidental breakage, temperature change, and domestic pets – should be scheduled.

Wine

 Scheduling wine provides additional coverages not available under the regular homeowners policy such as temperature change due to power interruption and breakage for any reason.

Chartwell Bulletins are produced by Chartwell Insurance Services, Inc. an independent insurance broker specializing in the personal asset protection of high net worth individuals. Chartwell Bulletins address issues of general interest and since coverages vary by company and by state, should not be taken as an interpretation of a particular policy or advice on any individual situation.

A representative of Chartwell Insurance Services, Inc. will be pleased to discuss all aspects of your personal insurance.   Contact: Rebecca Korach Woan | 312. 645.1200 | rwoan@chartwellins.com