The engagement ring is one of the most important purchases you’ll make. Although it is priceless to you and your spouse, you will want to replace it if you lose it. For a modest yearly fee, you can get engagement ring insurance to protect you in case your ring is lost or stolen.
In this article, jewelry expert and author Benjamin Khordipour will teach you everything you need to know before proceeding with engagement ring insurance.
What is Engagement Ring Insurance?
Engagement ring insurance is a special policy that will protect your jewelry investment in the case of loss or damage. The recurring fee is typically very low and is paid in monthly increments.
Most insurance plans will protect the policy owner if the ring is stolen or lost. Some insurance plans will also cover damage (see below).
There are three types of engagement ring insurance plans:
- Homeowners (or renters) insurance that automatically includes engagement rings
- Adding a clause to your homeowners or renters insurance to include your engagement ring
- Setting up a custom engagement ring insurance plan
| Homeowners Insurance | Custom Jewelry plan | |
|---|---|---|
| Loss | Not Covered | Covered |
| Theft | Covered | Covered |
| Damage | Sometimes | Covered |
| Disappearance | Sometimes | Covered |
| Travel | Covered | Covered |
| Impacts Insurance Score | Yes | No |
How Much Does Engagement Ring Insurance Cost?
Engagement ring insurance valuation will determine the yearly price of the insurance.
The average engagement ring insurance cost will typically run between $1 – $2 for every $100 of the appraisal worth. In other words, you must pay between 1% and 2% annually to keep your ring insured.
The average cost of an engagement ring in the USA is about $6,000 (and rising). This means that the insurance policy for the “average” ring would cost between $60 and $120 annually. The prices will fluctuate depending on the insurer and the coverage required.
Although $120 may seem like a lot of money, if you consider the cost of buying a new ring, it suddenly seems like a very small price to pay.
There aren’t too many ways to reduce the cost of an insurance policy for an engagement ring. Some insurers will offer a reduction if the ring is kept in a safe when not in use. Of course, taking advantage of this discount could backfire. If you claim to use a safe and the ring is stolen from your nightstand, they may not pay.
Documents Needed for Engagement Ring Insurance
The insurance company will ask you for a few things when setting up the engagement ring insurance plan.
- An appraisal declaring the value and attributes of the diamond and ring
- A store invoice with proof of purchase and price
- Location information of the place where you reside
If you purchased your engagement ring at a respectable jewelry store, you should have automatically gotten an appraisal and an invoice with the purchase. If you purchased the ring elsewhere or it is an heirloom, you will want to send it off to an appraisal company to get it independently appraised. Click here to see what needs to be on the appraisal.
Engagement Ring Insurance Calculator
This calculator will calculate the average cost of engagement ring insurance.
As the calculator below shows, the monthly price will be cheaper if you choose a plan with a deductible. A deductible is the amount you will pay toward the policy if you need to activate it.
The cost will vary slightly based on your zip code/location.
How to Get an Appraisal for Insurance
Most insurance companies insist on a professional appraisal before agreeing to cover loss and damage. You will have difficulty finding a policy offering decent coverage without a proper appraisal.
Although there are many appraisal companies, some insurers will insist that you only use a recognized company. Sometimes, they will give you a list of appraisers they are willing to use in your area, but usually, they will just expect you to find a highly recognized appraisal company on your own.
Once you find an appraiser, here are the items you want to ensure are included in the report. Usually, they’ll know on their own, especially if you mention that you want the appraisal for insurance purposes, but we recommend mentioning these items regardless:
- Center Stone Carat Size (this will be an approximation as appraisers will not remove the stone themselves)
- Center Stone Quality (clarity, cut, and color)
- Material of the mounting
- Approximate replacement value
If your gemstone came with a GIA report or similar document, we recommend showing it to the appraisal company before they begin their report. They usually defer to the GIA’s grading and incorporate it into the appraisal.
The appraisal’s most important aspect for insurance purposes is the replacement value. This price will determine your monthly payment and the insurance company’s payment if you lose the ring.
Important Note: Although GIA certificates are very respected in the industry, they cannot be used for insurance purposes as they don’t have a replacement value on their certificate.
Engagement Ring Insurance Warnings and Tips
There are so many things that you need to know to successfully set up your engagement ring insurance. Here are some of the most important tips and advice we’ve collected over the years of selling engagement rings.
1. Ask about Theft and Loss
Some policies only insure against theft, and although this should be clear in the policy, it’s worth asking the question. You are more likely to lose your ring than have it stolen, so make sure the policy covers both eventualities.
Also, make sure that the exceptions are reasonable. Some exceptions in the policy will preclude almost any chance you have to claim your money back.
2. Get Insured for Ring Damages as Well
Most insurances (especially home and rental insurance) do not cover damages, meaning the ring will not be insured if it is crushed, stepped on, or mangled. Fixing a broken ring can cost thousands of dollars if the damage is intense.
If you feel that you’re prone to damaging your ring, make sure that you select a plan that will cover you properly.
3. Make Sure that the Valuation is Correct
The valuation amount must be correct. There are a few reasons for this:
- An incorrect evaluation may jeopardize the entire policy. The insurance company may use this error to get out of paying your policy.
- A high evaluation will inflate your monthly insurance bill far above the price you should pay.
- A low evaluation won’t give you enough money to recreate the same ring again if you need an insurance payout.
In short, make sure the valuation is correct.
4. Re-appraise the Ring Every Few Years
Jewelry prices inflate with time. It is extremely important to reappraise your jewelry every few years to ensure the replacement value is accurate.
We’ve seen many jewelry pieces (especially rare vintage rings) increase dramatically in value, but because the customers didn’t insure at their new prices, they only got a payout that lined up with their original price.
5. If You Change Your Jewelry, Get it Re-appraised
If you upgrade anything in the ring (or jewelry), ensure it is reappraised and then resubmitted for a fresh policy. For example, if your diamond engagement ring started with a J color and VS1 diamond and then you upgraded the diamond to a D color and VVS1 clarity, you will want to be certain that you get it reappraised and resubmitted to the insurance.
6. Ensure that Insurance Company Isn’t Too Tough
Most insurance companies will trust you when you say your ring has been lost, broken, or stolen. The punishments for insurance fraud are enough to deter most people from trying to play around with fraudulent claims.
That being said, ensure that the insurance company doesn’t have a reputation for being impossible to claim. A quick online search should usually do the trick. See what the internet has to say about the company. Find another company if you see loads of reviews of customers claiming that the insurance doesn’t pay out.
Frequently Asked Questions
Will Home Insurance Cover the Engagement Rings?
Homeowners insurance is usually a requirement for the lenders when a mortgage is agreed upon. The banks want you to protect the value of your home and its contents. Your homeowner’s insurance will usually not cover high-value items.
Most homeowners and renters insurance policies may have a special option to add valuable items to the policy. Often, for a fairly nominal extra fee, you can add to cover the loss or damage to your jewelry.
That being said, we strongly recommend using an insurer who specializes in jewelry coverage. Although these policies are more expensive than the homeowner policy add-ons, they usually offer greater protection and more options for full replacement rather than automatically paying a set monetary value. Additionally, they won’t impact your premium if you need to make a claim/
How Does an Appraisal Document Work?
Estate Diamond Jewelry generally uses the UGL for insurance evaluation, so we will use their document as an illustration. We trust UGL due to their extensive experience in dealing with antique rings. All insurance companies throughout the US recognize them. They are a fantastic company to use if you need an insurance report.
Click here to learn how to read and understand your UGL appraisal.
One thing to note is that the initial valuation should be only the first of regular valuations for as long as you have the ring. Many rare or vintage rings are likely to increase in value. We’ve seen many vintage rings triple in value a mere twenty years later. A policy that pays out the original valuation isn’t going to provide a replacement for equal standing.
You should reevaluate your ring every five years or so. If possible, we recommend that you use the same appraiser each time. You shouldn’t have to pay as much for your reevaluated appraisal. It will also be a much quicker process. The appraiser will likely have the original details, but this shouldn’t stop you from keeping a copy.
Will a GIA Certificate Work for Insurance?
The GIA certificate will not work for insurance. Although the GIA certificate is the most authoritative diamond certificate available, it will not be helpful for insurance purposes. You will need to bring the ring to an appraisal company, and they will generate a valuation for your insurance company. The appraisal needs to fill out the estimated retail value section.
We advise giving the GIA certificate to the appraiser. This will help them generate the most accurate results.
Final Thoughts
Although engagement ring insurance is an extra cost in addition to purchasing the ring itself, we believe it is not just a good idea but a critical feature that everyone should take advantage of.
We also recommend using a jewelry-exclusive insurance company instead of homeowners/rental insurance or an added rider to your home insurance.
Additionally, we strongly recommend adding the insurance as soon as possible instead of waiting months or years before setting it up.
Do you have any jewelry questions or want a quote to recreate an engagement ring? Fill out the form, and we will respond within one business hour.
