Insuring against Valentine’s Day disasters

From broken necklaces to broken hearts, what advice should brokers give ahead of the most romantic day of the year?

Insuring against Valentine’s Day disasters

Insurance News

By Lucy Hook

Valentine’s Day is just around the corner, and US consumers are expected to spend around $18.2 billion on the occasion, according to The National Retail Federation – which is good news for retailers.

However, those planning to spend a little more might be in store for some bad news, when they find out that their high-value jewellery purchases aren’t covered by their existing insurance policies.

“It’s up to the brokers and the agents to make sure the customer understands their policy,” Janece White, senior vice president, Chubb Personal Risk Services, told Insurance Business.

Many consumers will be unaware that the majority of home contents policies will have a caveat limiting the coverage offered for loss or theft of jewellery – a limit which tends to average at around $1,000 to $5,000, subject to a deductible, White explained.

“Normally your contents policy has an extremely limited coverage for jewellery,” White added. “So, depending on what your deductible is, you could have almost no coverage – depending on what you lost,” she said.

Purchasing extra blanket coverage of a fixed amount is a good option for clients to cover a number of smaller items, alongside scheduled higher-value items such as engagement rings and watches.

“That’s a way of giving yourself some leeway,” White explained.

But brokers should also advise customers on the buying process itself, according to White.

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Clients should be advised to first check the return policy on any item they are considering buying – “know the policy – is it an exchange, a complete refund, or no refunds or exchanges at all,” White said.

When it comes to high-value purchases, particularly items such as large stones, brokers should always advise clients to seek authentication – “if you’re spending significant money, you want to make sure that the purchase that you got, is in actuality the value that you think it is,” White explained.

Lastly, brokers should advise clients to not be the “conspicuous shopper,” while out searching for their purchase, White said.

Many high-profile stores sell their items in iconic and easily recognisable packaging, which White described as “neon signs to the individuals who would do you harm.”

Where possible, clients should be advised to conceal items in a less obvious bag such as a briefcase or grocery bag when carrying the purchase home, as well as ideally avoiding public transport.When it comes to coverage, the best way for a broker to prepare clients is to have these conversations far ahead of an occasion such as Valentine’s Day, and to remind clients of the extent of jewellery coverage during renewals.

White added: “I must say there are a lot of times people do not call their broker or have that conversation beforehand, that why it’s important to have that conversation when they are talking about all of their coverages.”

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