Protecting High-Value Jewelry

What your clients need to know

By Katja Zigerlig

Key Takeaways:

  • A homeowners policy typically limits coverage for jewelry. A private collections policy is a more fitting solution for high-net-worth clientele.
  • Jewelry items are acquired over time; your clients may not be thinking about the cumulative value of what they own.
  • Independent insurance agents offer access to multiple insurance companies. A good agent will assess your clients’ individual needs and point them to the most appropriate coverage and service solutions.

Valentine’s Day is just around the corner, and jewelry is always a popular gift. It also can be a savvy investment, as the value of precious metals remains strong and rare gemstones continue to sell at auction record prices. In addition, recent museum exhibits on jewelry—from Cartier at the Grand Palais in Paris to J.A.R. at the Metropolitan Museum of Art in New York—attest to the cultural and artistic value of jewelry as adornments, collectibles and creative objects.

However, there are real risks impacting this asset class. For example, over $1.8 billion worth of jewelry and precious metals were stolen in the U.S. in 2012 and only four percent of those items were recovered, according to FBI crime statistics.

Your clients may not realize that most homeowners insurance policies specifically limit coverage for jewelry. The value of wedding rings and an expensive watch would exceed those limitations in most cases.

To ensure proper financial protection, high-value jewelry should be insured via a private collections insurance policy. In many instances, these types of policies are not available in the “direct” marketplace; they can be obtained only by working with an independent agent or broker with access to multiple insurance companies. While this may seem to be a deterrent, moving to the independent agency channel increases the likelihood that your clients can obtain best-in-class coverage and claim service, particularly when they have substantial personal assets across the board.

Following are examples of the improved coverage features at your clients’ disposal when buying insurance through an intermediary who works with high-net-worth personal lines insurance companies:

  • Worldwide coverage
    Many people wear watches and meaningful pieces of adornment frequently and take beloved pieces on vacation.

  • Immediate coverage for new acquisitions
    Because jewelry purchases often are impromptu, some insurance companies activate coverage from the point of purchase and offer between 60 and 90 days to be alerted about the new acquisition(s).

  • Coverage for pairs and sets
    If a client loses a single earring or cuff link, there should be policy wording describing how the pair will be made whole, such as payment for the missing piece or compensation for surrendering the remaining item.

  • Coverage for jewelry in a bank vault
    Clients who keep items in a bank vault can benefit from reduced rates because of the superior security.

  • Inflation protection
    Unlike a painting, a diamond set in platinum will always have value due to the global market for precious metals and gemstones. As prices for these commodities continue to increase, many insurance companies will stipulate an automatic annual inflation increase of 5 percent to 10 percent.

Proactive risk management: Tips for you and your clients

1. Play it safe at home
Clients should store jewelry in a safe and remove it from the safe only just before putting it on. Safes should be bolted into the structure of the home so they cannot be removed and broken into later. An Underwriters Laboratory-listed safe—rated to withstand a two-hour burn—is optimal. For added protection, install a second safe in a room other than the master bedroom for very valuable items. Thieves always go to the bedroom first. Finally, conduct background checks on private staff. Unfortunately, many jewelry thefts are inside jobs.

2. Stay alert while abroad
Wearing jewelry in airports and on commercial aircraft increases the chance of loss and can compromise personal safety. Take only what is necessary for the trip. Jewelry should be worn or kept on your person at all times (never in a checked bag). Treat jewelry as if it were a wallet—never let it out of your sight. When traveling, keep a list of the items you are carrying and leave a copy of the list at home. Upon arrival, always store jewelry in the hotel safe or safe deposit box, and protect pieces from damage in a padded jewelry portfolio.

3. Ship with caution
Shipping should be a last resort, as the risk of damage or loss is elevated greatly. Use only specialized jewelry shipping services, not standard overnight services. A specialized jewelry shipper is also recommended when purchasing items on vacation or when moving them to a seasonal residence. When possible, identify local jewelers for all repairs, maintenance and appraisals.


Whether it’s a Valentine’s gift or a family heirloom, a piece of jewelry often carries great sentimental value. When you factor in the added financial worth, jewelry becomes an asset class worthy of special attention. Your clients who own considerable amounts of jewelry may not consider these items to be a “collection,” but with proper guidance you can get them on a long-term path toward sound protection.

About the Author

Katja Zigerlig is Vice President, Fine Art, Wine and Jewelry Insurance for AIG Private Client Group. Prior to joining AIG in 2004, she underwrote insurance for private collections, museums, galleries and exhibitions for AXA Art Insurance Co. She also worked at the Walker Art Center in Minneapolis and interned at the National Gallery of Art in Washington, DC. Ms. Zigerlig has BA and MA degrees in art history, with a specialty in 20th Century art. She is a member of several arts-related organizations and speaks internationally. She has been quoted in the Wall Street Journal, The New York Times, Financial Times, Bloomberg, Art & Auction and has appeared on CNBC's Power Lunch.