Schedule Your Personal Property

A home insurance policy covers your personal property. This is what replaces for your belongings in the event something happens, whether it's theft or fire or a thousand other causes of loss. Unbeknownst to most, there are some pretty serious limitations to this coverage that your insurance company may have let go unnoticed.

Your property coverage on your home or renters policy has something called "underlying limits of liability." These limits are built into every single policy with the intention of protecting the insurance company from fraudulent claims. These limits apply to things like cash, collections, fine art and jewelry, and as each of those limits varies between policy and type of belonging, they are typically not very high, and in the event, you have a loss, many of these high-value items will only be covered to that limit.

This is where scheduled personal property or an inland marine policy comes into place. For a small amount of additional premium, you can list these things of high value on your policy and insure them to their full value. Almost everyone has something they should be scheduled, at least everyone who has a wedding ring.

Scheduling things like fine arts and jewelry have some additional benefits as well. Most people make the assumption that theft is covered under your policy, and for the most part that is true. However, on your homeowners or renters policy, you have an exclusion called "mysterious disappearance." Mysterious disappearance refers to a loss of property where you can't prove what happened. Often it is theft with no forced entry, a piece of jewelry missing from your jewelry box or the diamond falls off your ring at the park never to be seen again. These types of losses are not covered by your standard insurance policy. This is by design; your insurance company sets this limitation to prevent fraudulent claims. If they did not have these limitations, anyone with policy could come up and say "Hey, I lost this $30,000 ring, you have to cover it". Without these limitations, the insurance company would have no recourse and be forced to pay out a claim for an item the person may not have ever even owned.

However, when you schedule the item they have it on file, they know what it is worth, and they have agreed to pay you for the value of that item in the event of the loss.

On top of that, it is no longer insured on an "actual cash value" basis, which would include depreciation and other negative factors, but instead is insured to true value. When you schedule an item, it is either insured at "replacement cost," which is the amount it would cost you to replace the item. In cases like fine art where the value of the item can be more abstract and harder to replace, scheduling that item is done on a "agreed value" basis, meaning the insured and the insurer agree what that item is worth, and that amount is paid to the insured in the event of a loss.

Jewelry and fine art are not the only things that have specific limits built into the policy. Things like computers, camera equipment, even bikes have limits like this. Bikes especially are prone to falling under the exclusion of "mysterious disappearance." However, all of these things can be scheduled on your policy, or insured through a stand-alone policy called an inland marine, and save you from a huge out of pocket loss.

Talk to your agent about a HO68 (replacement cost) or HO71 (agreed value) endorsement on your home policy, or get a quote today for your inland marine policy.

Share On Facebook

Kevin Charles

Associate Writer

Kevin is the newest member of the Wavez writing staff. He lives in Los Angeles and got his start as a screenplay writer. He still loves writing scripts in his free time and hopes to one day have a play on Broadway!