It’s time to think about those holiday gifts you’re about to receive this year. The holidays can bring in everything from new electronics to new cars to jewelry, with all being vulnerable to theft, damage or destruction. Whether from fire, flood, vandalism, or other perils, these gifts need to be protected through comprehensive insurance coverage.
If you have homeowners or renters insurance, gifts are considered your personal property and are generally covered. If they’re stolen or damaged by events like fire, insurance should replace them, minus the deductible. Even if the items are stored in your car, they should be covered by a homeowners or rental policy.
While no one should go about the holidays thinking that something bad is destined to happen to their new gifts, it’s important to know what’s covered under certain insurance options and how items can be protected from loss and damage.
Home Insurance Policies
If you’ve been eyeing that nice designer handbag, or a new set of golf clubs, and you are fortunate enough to receive it as a gift this holiday, are you automatically covered?
What about other items like Apple watches, new phones, hunting gear, or bicycles? Are they all covered by homeowners insurance?
Generally, personal belongings are covered under the “contents” or “personal property” section of a homeowners policy. Within this section, most policies include a list of special limits of liability that apply to certain categories of property, such as jewelry, silverware, furs, guns, money and coins. Depending on the specific policy and insurance company, these items may be limited to a maximum coverage amount of perhaps $2,500 or $5,000 per loss. For this reason, certain categories of personal property should be separately insured on a valuable items rider. The separate coverage allows for higher limits, and often provides broader coverage – for example, covering an item if is lost or accidentally broken. The valuable items coverage is usually available without a deductible, whereas the standard homeowners personal property coverage normally has a deductible. Each insurance company has their own guidelines for which types of property they are willing to insure on a valuable items rider.
Quick Tips on Coverage
- Normal household contents are generally covered under your homeowners policy, subject to the deductible.
- Certain categories of valuable items, such as jewelry, art, furs, and silverware usually have limited coverage under a homeowners policy and should be insured separately on a rider.
- High valued electronics may be insured on a rider to ensure they are covered against a broader range of perils.
- Gift cards may be subject to limitations under a homeowners policy.
- Unique or collectible items may be insured on a rider to ensure they are valued properly.
- If you receive a new car as a gift, it will have to be added to your auto policy immediately.