Tag 6 of 6 · Insurance
Jewellery, valuables and insurance
Moneysmart says contents insurance can cover jewellery, but that most policies cap what you can claim for certain items, and it suggests checking which items aren’t covered and deciding whether to add valuables such as jewellery and special collections. The figure it uses to size cover is what each belonging would cost to replace at today’s prices.
General information only. This guide does not arrange insurance or give financial advice. ASIC’s Moneysmart explains contents insurance in plain words, and each policy’s own product disclosure statement sets its terms.
Where valuables sit in a contents policy
Moneysmart describes contents insurance as cover for household items and personal belongings if they’re damaged, lost or stolen, and its examples run from furniture and clothes to tools and jewellery. Insurers define “contents” themselves, so Moneysmart suggests checking the definition; generally it means items not permanently attached to the home.
Valuables get their own mention. Among the things Moneysmart suggests checking is what a policy leaves out, and whether to add something to it: it names portable items, and “valuable items like jewellery and special collections, such as artwork, stamps, rare books or memorabilia”.
Six questions to put to a policy
Each question below comes from one of Moneysmart’s own checks, applied to valuables.
- Are valuables in, or only if added?Moneysmart suggests checking what items aren’t covered and deciding whether you want to add something, naming jewellery and special collections.
- What is the limit for this kind of item?Most policies have maximum amounts you can claim for certain items. If an item costs more to replace than its limit, you pay the difference.
- Is it covered away from home?Portable contents cover protects some belongings away from the house. There will usually be a per-item value cap, each insurer has its own list of included items, and the cover may be an optional extra.
- Replacement value, or value?Most contents insurance pays replacement value, sometimes called “new for old”: the full cost of replacing belongings with new ones. Some policies pay what items are worth at the time they’re insured, a value likely to go down each year.
- Does it cover accidents?Moneysmart says most contents insurance doesn’t include accidental damage, and that it may be worth adding if you want cover for mishaps.
- How is a claim settled?Insurers may repair or replace damaged items, or pay what it would cost to repair or replace them.
Keeping cover current
Moneysmart says underinsurance can affect contents insurance as well as the building, if cover isn’t enough to replace what you own, and that what you own changes over time. It adds that going a year or more without a review makes underinsurance easy.
Comparing what policies say
Insurers must publish a Key Fact Sheet for each policy, in a layout the government prescribes so that policies can be compared like for like. Among the features Moneysmart suggests comparing are the cover limits on certain items.
One ring, three different questions
This is the guide’s own reading, set beside the sources it rests on. The same piece of jewellery can be asked three questions with three different answers:
| Purpose | The question asked |
|---|---|
| Contents insurance | What would it cost to replace at today’s prices, within the policy’s limits? |
| Tax | What would a willing buyer and seller agree in an arm’s length transaction, at a particular time? More in Valuations for tax at home. |
| A gift under the Cultural Gifts Program | What is its GST-inclusive market value within 90 days of the date of donation, by two approved valuers? Jewellery is among the ATO’s examples of eligible gifts. More in Valuing a cultural gift. |
The ATO expects a valuation report to state its purpose, and Queensland’s instructions to a property valuer include why you are getting the valuation. A figure prepared for one purpose may not answer another, and the stated purpose is where that shows.
Making a claim
Moneysmart’s page on making a claim sets out the steps, including what the insurer must tell you if a claim is denied.