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Good afternoon Pricescopers,
Many people have questions about the coverage option Chubb provides where they will pay up to 150% of the insured amount in the case of a loss. There’s quite a bit of confusion over this and I spoke with a friendly Chubb agent, Ralph Cohen at Touchtone Insurance and the good folks at the Chubb claims department about how this works. Here’s a summary of what I found.
Each valuable articles policy has a cash payment value associated with each item on the policy as well as an aggregate value which is the sum of the values of each individual covered item. These values are determined at the time you start the policy and will be based on information provided by you at the time of application. In the case of a covered total loss of an item, they will pay this amount in cash directly to you, the insured. You can then spend the money however, whenever and wherever you would like.
If you choose to replace it with another identical piece, they will reimburse you for additional expenses up to 150% of the declared value under certain conditions. This is the part that causes confusion. First, you must actually buy a replacement item and what you buy must be comparable (not an upgrade), to the one lost. Secondly, you must have other items on the policy so that the total amount paid is still less than the aggregate value of the policy.
For example:
Assume you have a $10,000 ring, a $5,000 pair of earrings and a $5,000 pendant, all covered using a Chubb valuable articles policy.
If you lose the ring in a covered loss, they will pay $10,000 in cash to do with as you see fit. Buy a ring, buy a car, put it in the bank. It doesn’t matter, it’s your money to do with as you wish and they don’t even ask.
If you then go and buy a new ring, discover that prices have changed since you got the policy and find that you need to pay $14,000 to replace it, they will reimburse you for the ‘extra’ $4,000 that you needed to pay to make yourself whole again.
If you lose all 4 items in a covered way, they will pay $20,000, exactly as above but with this difference: In this case, the 150% issue does NOT apply because you have reached the payment limit of the policy.
If you insure only the ring, and lose it in a covered way, the claim will be for the entire declared value of $10,000. This it the maximum they will pay and the 150% rule will not apply, even if you discover a shortfall when you replace it.
Please note that all insurance policies are not the same, even policies issued by the same company. The rules vary from state to state, and from policy to policy. The real details of your coverage are governed by the terms of your policy, not by what I or anyone other than the company has to say. You MUST read your policy. Part of the job of your agent is to explain to you the various options available to you and to help you choose the right policy for your situation. Ask ‘em, that’s part of what they’re trained to do.
Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Jewelry Appraisals in Denver
Many people have questions about the coverage option Chubb provides where they will pay up to 150% of the insured amount in the case of a loss. There’s quite a bit of confusion over this and I spoke with a friendly Chubb agent, Ralph Cohen at Touchtone Insurance and the good folks at the Chubb claims department about how this works. Here’s a summary of what I found.
Each valuable articles policy has a cash payment value associated with each item on the policy as well as an aggregate value which is the sum of the values of each individual covered item. These values are determined at the time you start the policy and will be based on information provided by you at the time of application. In the case of a covered total loss of an item, they will pay this amount in cash directly to you, the insured. You can then spend the money however, whenever and wherever you would like.
If you choose to replace it with another identical piece, they will reimburse you for additional expenses up to 150% of the declared value under certain conditions. This is the part that causes confusion. First, you must actually buy a replacement item and what you buy must be comparable (not an upgrade), to the one lost. Secondly, you must have other items on the policy so that the total amount paid is still less than the aggregate value of the policy.
For example:
Assume you have a $10,000 ring, a $5,000 pair of earrings and a $5,000 pendant, all covered using a Chubb valuable articles policy.
If you lose the ring in a covered loss, they will pay $10,000 in cash to do with as you see fit. Buy a ring, buy a car, put it in the bank. It doesn’t matter, it’s your money to do with as you wish and they don’t even ask.
If you then go and buy a new ring, discover that prices have changed since you got the policy and find that you need to pay $14,000 to replace it, they will reimburse you for the ‘extra’ $4,000 that you needed to pay to make yourself whole again.
If you lose all 4 items in a covered way, they will pay $20,000, exactly as above but with this difference: In this case, the 150% issue does NOT apply because you have reached the payment limit of the policy.
If you insure only the ring, and lose it in a covered way, the claim will be for the entire declared value of $10,000. This it the maximum they will pay and the 150% rule will not apply, even if you discover a shortfall when you replace it.
Please note that all insurance policies are not the same, even policies issued by the same company. The rules vary from state to state, and from policy to policy. The real details of your coverage are governed by the terms of your policy, not by what I or anyone other than the company has to say. You MUST read your policy. Part of the job of your agent is to explain to you the various options available to you and to help you choose the right policy for your situation. Ask ‘em, that’s part of what they’re trained to do.
Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Jewelry Appraisals in Denver
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