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Jewelers Mutual or is Chubb REALLY worth it?

katrobinson1

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May 20, 2013
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Hey Everyone,

So I am newly engaged (happened about two weeks ago) and now it is time to nail down insurance on this beautiful ring. I've scoured the forum here and gather the recent consensus is that Perfect Circle by Jewelers Mutual is the best option since Chubb no longer offers standalone jewelry policies for items less than $200k.

Okay so that's fine. However, the cash payout option of Chubb feels as if it might be worth transferring ALL of my personal insurance (Home, Auto, Life, Umbrella) over to Chubb. I have Liberty Mutual for the past 3 years and find my agent to be perfectly nice but have yet to file a claim so...

I spent months looking for the perfect stone (Good Old Gold was AMAZING by the way -- but that is a separate review post come later) and the light performance is truly special. The stone is rated at an AGS0 Ideal Cut and just sparkles brilliantly in EVERY type of light. GOG recommends Perfect Circle and I assume they are a "preferred vendor" of Jewelers Mutual which would mean less hassle for me should there ever be a claim.

However, I've read reviews here and there describing Chubb taking a long time to pay out claims. Consumer Reports gave them high marks but maybe this is a new issue?

FYI: GOG appraised the ring at $23k.

Thoughts?
 

WinkHPD

Ideal_Rock
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katrobinson1|1387696009|3578998 said:
Hey Everyone,

So I am newly engaged (happened about two weeks ago) and now it is time to nail down insurance on this beautiful ring. I've scoured the forum here and gather the recent consensus is that Perfect Circle by Jewelers Mutual is the best option since Chubb no longer offers standalone jewelry policies for items less than $200k.

Okay so that's fine. However, the cash payout option of Chubb feels as if it might be worth transferring ALL of my personal insurance (Home, Auto, Life, Umbrella) over to Chubb. I have Liberty Mutual for the past 3 years and find my agent to be perfectly nice but have yet to file a claim so...

I spent months looking for the perfect stone (Good Old Gold was AMAZING by the way -- but that is a separate review post come later) and the light performance is truly special. The stone is rated at an AGS0 Ideal Cut and just sparkles brilliantly in EVERY type of light. GOG recommends Perfect Circle and I assume they are a "preferred vendor" of Jewelers Mutual which would mean less hassle for me should there ever be a claim.

However, I've read reviews here and there describing Chubb taking a long time to pay out claims. Consumer Reports gave them high marks but maybe this is a new issue?

FYI: GOG appraised the ring at $23k.

Thoughts?

I have never had any problem with Jewelers Mutual/Perfect Circle. For example, from earlier this year...

I sold a client a very nice oval diamond in June of this year. His wife somehow chipped the diamond and they sent it to me in Early to mid October if memory serves. I found a nice oval of two points larger than the original and one color grade higher and called JM about what I had been able to find. They agreed to the increased value since it is hard to find a well cut oval and the one lost was indeed well cut. This was an increase of almost $2,000 over the original purchase price of the oval.

Upon getting the stone in and getting my clients approval it was about three weeks all totaled to get permission on the stone, arrange for my client to see it and to return the newly finished ring to my client. He signed the release and I submitted all paperwork to the JM and had my check in hand within ten days.

Naturally, since I was being paid by JM I released the diamond to my client as soon as it was ready since JM had authorized the replacement.

That is pretty much the pattern of every replacement I have done with JM over the years. I receive the job, I get permission on a particular diamond or stone for the job, I do the job, I get paid. Easy Peasy. I am a big fan of JM.

Wink
 

diamondseeker2006

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Have you gotten quotes for homeowners yet from Chubb? I am just curious how your rates would compare to LM. I think you'd have to weigh what your total premiums would be to decide. I do have a Chubb standalone jewelry policy from a few years ago and found my premiums no more than Jeweler's Mutual. The big thing about JM is to NOT have an inflated insurance appraisal because you will be overpaying for your premiums. So since JM requires an appraisal, I would tell GOG that you need the appraisal to be no more than 10% more than your purchase price, because you can replace that ring tomorrow for about what you paid for it. You don't need a huge cushion. The great thing about Chubb is that they ask me every year if I want to increase my coverage by 10% or more without an additional appraisal. So every few years, if I see that prices are rising, I can increase my coverage without having to get a new appraisal. With Chubb I am able to insure with my straight purchase price.
 

WinkHPD

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diamondseeker2006|1387776787|3579363 said:
Have you gotten quotes for homeowners yet from Chubb? I am just curious how your rates would compare to LM. I think you'd have to weigh what your total premiums would be to decide. I do have a Chubb standalone jewelry policy from a few years ago and found my premiums no more than Jeweler's Mutual. The big thing about JM is to NOT have an inflated insurance appraisal because you will be overpaying for your premiums. So since JM requires an appraisal, I would tell GOG that you need the appraisal to be no more than 10% more than your purchase price, because you can replace that ring tomorrow for about what you paid for it. You don't need a huge cushion. The great thing about Chubb is that they ask me every year if I want to increase my coverage by 10% or more without an additional appraisal. So every few years, if I see that prices are rising, I can increase my coverage without having to get a new appraisal. With Chubb I am able to insure with my straight purchase price.

While I agree that you do not need a full blown retail appraisal, I think you need more of a cushion than 10%. In the example I agave above there were some unusual circumstances. I found a bargain on the original oval, passed it on to my client and then when it came time to replace the oval the only stones on the market cost more than my client had paid. Plus, JM is used to dealing with retail jewelers, so they pay a higher margin than internet vendors normally receive. (sliding scale, depending on the actual cost of the item to the jeweler)

Internet margins on diamonds are extremely thin, so even a little bump puts the cost of the diamond above what the diamond was originally sold for. Human nature being what it is, almost no one is going to take the time to monitor the diamond market prices and run down for a new appraisal every time the market raises or lowers a few %. I always recommend a small cushion to my clients so that they are covered for small market adjustments. My client had his appraisal done by an independent appraiser who was about 35% above what my client paid for the ring. In this particular piece, only a few months after his original purchase, he needed a good deal of that extra margin.

Wink
 

denverappraiser

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It may not be a choice. Chubb isn’t available in all, or even most, markets, and as far as I know they aren’t writing stand along jewelry policies any more. You will need to move your house, cars, boat, airplane, etc. if you want to work with them. Google up an agent and ask them for a bid. They are a quality company if they fit your situation.

Replacement cost can be a tough thing to estimate and 10% is a pretty tight margin. Appraisers tend to err towards being too high rather than too low. You hunted long and hard to find just the right stone at the right price and the insurer will NOT be working that hard at it. They’ll take the specs off of your paperwork, use them as the purchase order for replacement, and head for a stone. The first place they’ll send you is back to the same store where you bought it (assuming they know and you agree) and the jeweler will go through the hunt process with you based on what they have or can get at the time. The actual selection is going to be different so if your requirements are tight, it’s entirely possible that they will need to special order it and he prices will go up. When you finally end up with a selection, they pay the jeweler on a cost plus basis. In a true bit of Internet weirdness, this can be MORE than what they would normally charge their retail clients because of the way Internet markups work.

Nearly everyone is a JM preferred provider. They’re very agreeable about this. If you have a particular jeweler you want to work with, all you need do is ask and chances are good that they’ll be able to work it out.
 

diamondseeker2006

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My Chubb insurance has some amount of inflation protection in addition to allowing me to increase coverage at any time without a new appraisal, so I do not have to overinsure by 30%. (And for that matter, my daughter's diamond that was purchased 3 years ago would not cost more than 10% more today than it did 3 years ago. She is still overpaying her JM premiums with an inflated appraisal.) My insurance would have cost more through JM had I used them and had to use an inflated appraisal. But again, since you asked about switching your home and cars to Chubb, I think you'll have to get all the quotes and compare. My homeowner's insurance went up this year, and I thought about getting rates from Chubb, but I just didn't have time to deal with it. It could be that their homeowners rates are really high and overpaying jewelry insurance would be the less expensive option.
 

WinkHPD

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diamondseeker2006|1387809379|3579458 said:
My Chubb insurance has some amount of inflation protection in addition to allowing me to increase coverage at any time without a new appraisal, so I do not have to overinsure by 30%. (And for that matter, my daughter's diamond that was purchased 3 years ago would not cost more than 10% more today than it did 3 years ago. She is still overpaying her JM premiums with an inflated appraisal.) My insurance would have cost more through JM had I used them and had to use an inflated appraisal. But again, since you asked about switching your home and cars to Chubb, I think you'll have to get all the quotes and compare. My homeowner's insurance went up this year, and I thought about getting rates from Chubb, but I just didn't have time to deal with it. It could be that their homeowners rates are really high and overpaying jewelry insurance would be the less expensive option.

Let's do a little math and see just how heinous that might be to "overpay" using a 30% premium over cost as the insured value.

In Idaho, where I live the cost of insurance from JM is 1.3%.

Let's say my client paid $7,500 for his ring. if he had a 10% cushion for his insurance that would mean he was paying insurance on $8,250.

If he had a 30% cushion that would mean he was paying insurance on $9,750. So he is, according to you, overpaying on the $9,750 - $8,250 = 1,500.

In Idaho that would mean he is "overpaying" $1,500 x 1.3% = $19.50 per year. Even if he lived in an area where rates are higher, perhaps a high crime area where rates are an exorbitant 5% that would still only be $1,500 x 5% = $75 per year "overpayment".

While these are not the actual numbers in my client's example, if they were I would be reporting that JM paid me about $9,500 to replace his diamond. How fortunate was it for him that he was NOT paying the premium on only $8,250?

Was this an unusual increase in such a short time? Yes, of course. Would it have been unusual in three or four year's time? I doubt it highly. Is it normal for many people to go many years between appraisals, even when they are reminded that they need to up date? Absolutely! (By the way, when I do an update, I require the client to bring or send the item in to me for inspection. I can not verify the ring is in good shape and not needing any repairs if I do not.)

I am not saying that a 30% cushion is the number to use, there are many factors to be considered for the appropriate and defensible number to be used in each appraisal. Starting with what is the purpose of the appraisal, as some appraisals are for purposes other than insurance. Those are discussions to have with someone like DenverAppraiser who in fact specializes in appraisals and understands the nuance of appraising for different markets and for different uses, including appraisals for insurance or probate, as well as civil and criminal trials.

There is no "one size fits all" appraisal answer. It is good that Chubb works for you and that you are happy with it. It is also good that JM is there for people who might rather use them.

Wink
 

diamondseeker2006

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I agree that it depends a lot on the value of the diamond, Wink. Obviously the lower the price of the stone, the less the cost differential is. I have a lot more than that insured, so it would be nuts for me to overpay with 30% over value. But perhaps if the stone is under $10k, it doesn't really matter very much, as you said. I think you have lower JM rates there than a lot of other places, though.

But in the case of her question, she still would have to see if their homeowner rates are much higher. Even though I think Chubb is better jewelry insurance, she cannot get it if she doesn't switch to their other policies, and it might not be financially beneficial to do that.
 

diamondseeker2006

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Okay, I was just curious so I took my own insured amount and put it in the Jeweler's Mutual calulator. I currently pay in the $500-599 range for my yearly Chubb premium. I put in the same value in JM and the premium was $693, so at least $100 more even at the same insured amount. Then I increased that amount by 30% for the typical inflated appraisal value and the premium was a whopping $901 a year!!!!

It is a shame there isn't more competition for jewelry insurance is all I can say (and I was very, very fortunate to get a Chubb standalone policy while they were offering them!).
 

denverappraiser

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In nearly every case where I've had the opportunity to compare rates, actually every case but yours, Chubb has been more expensive. I agree it's better coverage so there's still a question of whether or not it's worth the price. When I bid out my own personal insurance in suburban Denver, it was nearly triple. A stand-alone Chubb jewelry policy is no longer available here at all so there's no good way to shop it and my home value is below the minimum threshold for them to consider accepting me as a client for that business. That makes direct comparison shopping using my own account difficult but reports from clients show similar results. The typical JM rate here in Colorado is about 1% of the declared value with a bump of about 50% for people who live in the City and County of Denver. It's the same for the whole state and this gets modified for the value of the goods (expensive things have a higher percentage) as well as things like vault storage and the deductible chosen.

Nearly all of the major insurance companies offer jewelry coverage as an addon to a homeowners or renters policy, rather like what Chubb is doing although the details vary wildly in terms of how they handle claims.
Beyond JM, standalone policies are also available from JIBNA and Gemshield.
In high value policies, Firemans Fund and Lloyds of London are competitors. If you're value is high enough I'm pretty sure both will write a stand alone policy but expect a pitch for the rest of your business too. I'm sure there are more. Matching the client to the right insurer is part of what the agent is for and pretty much all of these companies sell through agents.
 

katrobinson1

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Messages
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Thank you all so much.

I am going to have a JM policy issued now so I at least have coverage on the ring and then schedule an appointment with a Chubb agent here in Phoenix. It would probably take a while with the holidays and everything to get something with Chubb setup anyway.

I am aware that I will have to switch my entire personal insurance over and am bracing for the real possibility of huge premium increases across the board.

Maybe knowing the premium increases will give more color to the situation but I am still curious to know if the cash-out option of Chubb is something I should really be looking at. In other words, while JM is great, is Chubb even better with the way they handle their jewelry claims? Is JM "fine" but Chubb is "great?"

GOG put together a 20-page appraisal packet that is very in-depth. I would just feel better knowing if something were to happen I just get a check -- for the full appraisal value -- and then can contact GOG and go from there. Right now my insurance costs are very, very reasonable with LM -- and I have A LOT of coverage. So switching might not be so bad, even if the premiums are double (triple is pushing it).

If that were the case -- would Chubb still be worth it? In the event of a loss, is a repair/replacement option totally fine or really, is Chubb worth it if I can get it?

And FWIW: I would feel most comfortable insuring the ring for the full appraisal value. The extra $10 to $20 a month (if that) don't bother me because at the end of the day, money is the last thing I want to be thinking about if I need to replace my engagement ring.
 

denverappraiser

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A check for the full appraised value in the case of a loss is NOT what JM generally is agreeing to. They are agreeing to replace with 'like kind and quality'. They will pay the jeweler directly for the replacement less whatever deductible you choose. As with all things insurance, these details vary from policy to policy and the language in YOUR policy is the one that counts. They're very friendly on the phone if you have specific coverage sorts of questions.
 

katrobinson1

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Right. JM is a repair/replacement *up to* the policy face value.

My question is how unusual it is for the JM policy to be insufficient in the event of a loss?

Given the really special specs of my stone (at least I think they are special), I am worried about this. But I don't know reasonable it is to worry, if that makes sense? Like, at what point does Chubb outweigh JM?

Also, is Chubb a hassle to deal with in the event of a loss? I just want a policy that I absolutely do not have to worry about truly replacing my engagement ring if something were to happen. Cost is a factor but it is by far less important.
 

WinkHPD

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katrobinson1|1387823587|3579586 said:
Thank you all so much.

I am going to have a JM policy issued now so I at least have coverage on the ring and then schedule an appointment with a Chubb agent here in Phoenix. It would probably take a while with the holidays and everything to get something with Chubb setup anyway.

I am aware that I will have to switch my entire personal insurance over and am bracing for the real possibility of huge premium increases across the board.

Maybe knowing the premium increases will give more color to the situation but I am still curious to know if the cash-out option of Chubb is something I should really be looking at. In other words, while JM is great, is Chubb even better with the way they handle their jewelry claims? Is JM "fine" but Chubb is "great?"

GOG put together a 20-page appraisal packet that is very in-depth. I would just feel better knowing if something were to happen I just get a check -- for the full appraisal value -- and then can contact GOG and go from there. Right now my insurance costs are very, very reasonable with LM -- and I have A LOT of coverage. So switching might not be so bad, even if the premiums are double (triple is pushing it).

If that were the case -- would Chubb still be worth it? In the event of a loss, is a repair/replacement option totally fine or really, is Chubb worth it if I can get it?

And FWIW: I would feel most comfortable insuring the ring for the full appraisal value. The extra $10 to $20 a month (if that) don't bother me because at the end of the day, money is the last thing I want to be thinking about if I need to replace my engagement ring.

I guess I am curious why you feel it necessary to go to Chubb to get to work directly with GOG. My client from above lives back East somewhere (I know but I am not saying) and I live in Boise, Idaho.) When he reported the damage to JM he told them he wanted to work with me and the game was on. My client and I have talked on the phone, but never met in person, and most likely never will. Working with JM in no way precludes you from working with Jonathon at JM.

Wink
 

denverappraiser

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No, Chubb is not a hassle. They're very agreeable. You can take the money and buy whatever you want, or nothing at all. That's where the difference happens. With JM (and most other policies), you are forced to replace the piece. There are some incentives to the jeweler to have you buy from someone inside the JM network but, as mentioned above, that includes just about everyone and certainly includes GOG. The only time I can see this being a problem is if GOG goes out of business in the meantime and you can't find an alternative jeweler that suits your fancy or you decide that you want something OTHER than a replacement diamond at claims time. You can 'upgrade' if you want but if you prefer, say, a new car then JM will be a hassle.
 

jramy278

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Wink/Neil, would you be able to shed some more light on how to figure out what a good "cushion" value would be for insurance purposes? We just got my ring and the appraisal value was slightly under 10% more that what my fiance paid. While I certainly appreciate it being not over inflated/fluffed up, I am now concerned that it's too tight a margin for insurance purposes (JM is what we are using) and am wondering if we should request an updated value. I apologize if this a threadjack OP - I've tried reading several posts on this but come away very confused each time :confused: . I'm hoping some of the experts in the trade can help, thank you!
 

denverappraiser

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Talk to your appraiser about this. It's part of what your paying them for.
 

WinkHPD

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Agree with Neil on this.

The biggest problem with insurance appraisals is lack of frank discussion with the appraiser about what you paid and what you need the insurance for. If you feel the appraisal is too low for what you need and you feel that something about Jonathon's stone made it worth more than the run of the mill cushion, then this needs to be discussed with your appraiser.

Wink
 

jramy278

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Thank you, I'll have my fiance talk with the appraiser.
 
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