Saturday, December 31, 2011

All About Diamonds Insurance

Insuring a diamond takes a bit of thought,  planning, and shopping around. Diamond  insurance isn’t like purchasing car insurance.  It is quite different. Depending on the state  that you live in, there are basically three different types of policies that will cover  diamonds, and all insurance policies that  cover diamonds are considered Marine  type policies.   
The first type of insurance policies for  diamonds is an Actual Cash Value policy.  If the diamond is lost or damaged beyond  repair, the insurance company will replace  the diamond at today’s market value, no  matter how much you paid for the diamond  to begin with. This type of insurance policy  for diamonds actually is not that common.  

The most common type of insurance for  diamonds is Replacement Value insurance.  The insurance company will only pay up to a  fixed amount to replace the diamond that was  lost or damaged beyond repair. This does not  mean that they will pay that amount – it means  that they will pay up to that amount. In most  cases, the diamond can be replaced at a  lower cost.

The third type of coverage offered for  diamonds is Agreed Value. This is  sometimes called ‘Valued At.’ This type of  coverage is very rare. In the event that the  diamond is lost or damaged beyond repair,  the insurance company simply pays you the  amount that you and the company agreed  upon. This is the best type of insurance to  have, but it is rarely offered. If you can’t get  Agreed Value coverage, Actual Cash Value coverage should be your next choice.

Your rates will be determined by the value of  the diamond, the type of coverage that you select, and the area that you live in. If you live  in an area with a high crime rate, you can  expect to pay more for your diamond insurance coverage. It is important to  remember that insurance agents are not  qualified jewelers, and jewelers are not  qualified insurance agents. It is best to get  a certificate for your diamond, and to  provide the insurance company with a copy  of that certificate. This leaves the insurance  company less room for arguments over the  actual value of the diamond.

Don’t rely on separate coverage to cover  your diamond. For instance, if you diamond  is stolen from your home, it is probably  covered on your home owner’s insurance  policy – but the diamond probably won’t always be in your home, and once it leaves  your home, there is no coverage.

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