The Question We Get All The Time: Am I Covered?

Post written by Scott Pearson, Sales Manager at Krueger & James Insurance  

Nothing makes my stomach ball up into a knot more than having to have to tell someone their loss may not be covered. Insurance isn’t a maintenance plan for your home furnace or AC unit.

It’s not for filing a claim for a loss that you can probably pay out of pocket. Insurance, at least its original intended use, was to compensate someone for a large financial loss, by transferring risk from one party to another for a specified period, for a specified cost, for a specified type of loss or peril.

Scott Pearson

Scott Pearson

An insurance policy isn’t an “All Risk” type of contract like our industry may have led you to believe or you may have assumed. It’s a very specific contract with very specific guidelines and conditions.

A good example is jewelry. Most basic homeowners policies give you a specific limit for theft of jewelry. Normally it’s $1,000.

BUT that limit only applies for theft of the item. If your home burns down, the jewelry is covered just like any other home content item.

If you paid $5,000 for it and it costs $5,000 to replace it, you can be reimbursed for it just like your clothes, bedding and other items. (subject to your homeowners insurance deductible of course.)

But what happens when it’s cold outside and you take your gloves off and put them in your pocket and you suddenly realize your wedding ring isn’t on your hand?

You reach into your pocket for your glove and the ring isn’t there. You then look in your pocket, search the area around your feet and it’s still not there. You then re-trace your steps and finally realize it’s gone.

What now?

You call your insurance agent and one of two things happen:

1. You’re told that you had the foresight to itemize all your valuable jewelry with CURRENT values and have scheduled it on your homeowners policy. You are then reimbursed for the “mysterious disappearance” of your ring, minus a small deductible.

2. Your agent asks you if it possibly could have been stolen. You honestly reply that you had put it on that morning and then realized it was gone. Now it’s nowhere to be found.  The agent then tells you that you have no coverage for your ring because two years prior you had decided not to itemize your jewelry because “You didn’t want to pay the additional premium” or had said “Nothing like that ever happens to me” or “It’s old and I don’t have time to get a current appraisal.” Those all may seem legitimate reasons not to purchase the extra coverage, but for those that don’t, it’s often an expensive lesson to learn.

It’s always a good idea to review your coverages with your insurance agent. If you’d like to do that, give us a call today at 816-471-4245.

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