Insuring Your Diamonds

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Insuring Your Diamonds

When you buy loose diamonds, just as when you buy diamond jewelry, it is really important to get them insured. Insuring a diamond takes a little of thought, planning, and shopping around. Diamond insurance isn’t like buying car insurance. It’s quite different. Depending on the state that you live in, there are basically three different types of insurance policy* 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 price, regardless how much you paid for the diamond to begin with. This type of insurance policy for diamonds really isn’t that common.

The basic type of insurance policy 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 doesn’t mean that they’ll pay that amount – it means that they’ll pay up to that amount. In most cases, the diamond may be replaced at a
lower price.

The third type of coverage proposed for diamonds is Agreed Value. This is Occasionally 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 just pays you the amount that you and the company agreed upon. This is the best type of insurance policy to
have, but it’s seldom proposed. 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 may expect to pay more for your diamond insurance coverage. It’s important to remember that insurance agents are not qualified jewellers, and jewellers are not
qualified insurance agents. It’s 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’s probably covered on your householders insurance policy – but the diamond probably won’t
always be in your home, and once it leaves your home, there’s no coverage.

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August 04 2009 12:26 am | Diamonds

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