[Return] to Part 1
Remind Me About Homeowners Limitations
In part 1, we told you that the typical homeowners policy
contains substantial coverage limitations for certain types of property. The
modest insurance protection affects property that is highly vulnerable to loss
because it is targeted for theft and/or has a high level of value in relation
to its size. Examples are gold, money/securities, precious metal-plated dinnerware,
jewelry, furs, stamps, electronic property, business property, watercraft and
firearms.
How Do You Handle The Limited Coverage
Situation?
You have to do something extra to your insurance program.
Insurance companies are happy to provide more coverage, if they are paid for
their trouble. Specifically, limited coverage can be handled using the following
methods:
Increased Coverage C Endorsement
- this form is only appropriate for property saddled with limited coverage for
theft losses. This form is attached to a basic policy and it increases the theft
insurance limit (ie. for jewelry from $1,500 to $5,000).
Scheduled Personal Property Endorsement
- this form is used for increasing coverage for property that has protection
reduced for all sources of loss. The property is removed from the basic policy's
limits and is covered exclusively by the endorsement. This form takes more work
since each item of property has to be listed and assigned a particular insurance
limit.
Inland Marine Property Floater
- this method works like the personal property endorsement, except that it is
a separate policy. This alternative is more appropriate for persons owning substantial
amounts of high-valued property. The coverage must often be purchased from specialized
insurers and comes at a high cost. In order to qualify for such coverage, you
may need to meet special circumstances such as having a residential alarm system
or make use of vault storage.
Another Advantage Of Special Handling
In order to arrange coverage under a schedule or an inland
marine policy, the property must be properly valued. This often involves appraising
the property. It's very helpful to have an expert source establish the current
value of jewelry, furs or other valuable possessions. In fact, such property
should be appraised every two or three years since their values often increase
over time.
Do you still have questions about property that needs special
handling? Talk to an insurance professional about your needs and make sure that
you have proper protection.
Please refer to part 1 for more information on restrictions
faced by certain types of personal property.
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