Do I REALLY Need to Insure My Engagement Ring?

Choosing an engagement ring can be overwhelming: you have to critique the 4Cs of every ring you examine – cut, clarity, color, and carat size. But there’s a fifth C you might want to consider: Coverage.

While engagement ring insurance coverage isn’t part of the ring comparison process, it is a key product that makes sense for many buyers. So, just how beneficial is an insurance policy for your jewelry, and is it really worth buying?

Let’s take a look at why you may want to ensure your engagement ring, what your insurance policy will provide, and how much you should expect to spend for coverage.

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Is Your Rings Value Monetary, Sentimental, or Both?

Whether you’ve been wearing that pretty sparkler on your left hand for two weeks or 20 years, it is probably a very important piece of jewelry. It represents the promises that you and your spouse have made to one another and it is likely to be one of the most expensive pieces of jewelry you own.

Before determining whether engagement ring insurance is worth purchasing, you should sit down and figure out how much sentimental value your ring holds versus monetary value.

While insurance can always cover the dollar value, no amount of money can replace your great-great-grandmother’s heirloom ring. Plus, it can be difficult to determine the replacement cost of an antique piece. And a ring may have very little monetary value even though it holds incredible meaning.

Since insurance can’t do anything to replace the emotional attachment to a ring, buying engagement ring coverage probably only makes sense for the monetary value. If your ring doesn’t have a high replacement cost, it might not be worth the hassle to buy a policy.

Consider Homeowners/Renters Insurance Coverage Limits

Most homeowners and renters insurance policies offer personal property coverage. This doesn’t just protect the furniture in your home. It can also protect your belongings — such as jewelry — even when you’re away from the house.

If your ring is more affordable or has more sentimental value than monetary, you may be fine with the coverage provided by your homeowners or renters insurance policy. Just be sure to consider the deductible that would apply for a personal property claim, as it can eat into your replacement value.

On the other hand, you shouldn’t rely on home insurance coverage if your jewelry is very valuable. That’s because there are almost always claim limits on certain high-value items, such as jewelry.

With some homeowners policies, this limit could be as low as a couple of thousand dollars. If you have a ring that’s worth $12,000 and have a policy limit of $2,000 on jewelry, you’ll be out the remaining $10,000.

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Can You Afford to Replace Your Ring?

The biggest question you should ask yourself when considering whether or not to buy engagement ring insurance is, Can I afford to replace this ring if I were to lose it (or if a stone were to fall out)? In fact, this is a key question to ask anytime you’re considering buying supplemental insurance or extended warranty protection.

A good rule of thumb is to only insure what you can’t afford to replace. For instance, my husband’s wedding band cost only $120 – while I still hope he never loses it, we could easily afford a replacement.

The same with my wedding band. While it would be painful to replace at $1,500, it wouldn’t break the bank.

My engagement ring, however, is an entirely different story. I certainly wouldn’t want to pay out of pocket to replace the ring if it were ever lost, or if the main stone were to fall out of the setting. So, we chose to insure the ring from day one.

Valuable Personal Property Insurance Can Be Cheap

One of the best parts of valuable personal property insurance is the price. Compared to many of the other insurance premiums you may pay, this coverage can be the most affordable.

The cost for engagement ring insurance is 1-2% of the piece’s value, on average. This means that a $5,000 engagement ring would cost around $50 to $100 a year in premiums. Certain areas — especially those with higher rates of crime and theft — may result in higher premiums.

When you think about the cost of replacing your engagement ring out-of-pocket, $4 to $8 a month sounds like a pretty good deal.

Differences in Coverage

Every insurance company is different, and the things that will be covered by your jewelry insurance may vary.

You’ll want to find a policy that covers all contingencies, meaning that you are protected whether your ring is stolen, slips off your hand while gardening, or the primary stone comes loose and drops out.

Some insurers will impose a deductible on engagement ring coverage, while others protect you without needing to pay anything out of pocket. Consider any applicable deductibles before purchasing your policy.

You’ll also want to make sure that you’re happy with the jewelry replacement options available to you if you need to file a claim. Some insurers will provide you with a reasonable replacement through the jeweler or company of their choosing, while others will let you have a say in choosing your new diamond and/or ring.

Things to Remember

When purchasing a new engagement ring insurance policy, you’ll be expected to provide certain documentation. This can include:

Your original purchase order and/or receipt
A certified appraisal showing the details of the piece and its value
Photos of the ring

You may also be required to have the ring reappraised after a certain number of years. This is in your best interests as well as the insurance company’s — paying for coverage on a ring with an inflated value will only result in needlessly-higher premiums.

If you’re shopping around for an engagement ring, start thinking about insurance options. For many couples, buying coverage is a wise idea that is also very affordable. You can even purchase coverage right away, before the proposal ever happens, just in case the ring were to be lost or stolen in the interim. (I’ll bet this guy wishes he had bought a policy!)

Bottom Line

At a cost of around 1-2% annually, engagement ring insurance makes sense for many couples. While your coverage won’t be able to replace the sentimental value, it can give you peace of mind when wearing that ring every single day.