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Those who DON''T insure their ring, please chime in here...

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Gleam

Gleam

Brilliant_Rock
Joined
Sep 19, 2009
Messages
565
I am choosing not to insure my 2.5 carat RB solitaire... we got what I think is a good price for it and we can afford to replace it if need be. I chose not to insure because my thoughts on luxury items like rings is that if I can't afford to replace it, I probably couldn't really afford it to begin with (just my personal philosophy for my own items). I am just generally anti-insurance for most things, but all the stories of chipped diamonds on here are making me rethink this decision. I had no idea chipping was so common?!?!

Why are you choosing not to insure? And have all the stories about chipped, damaged or lost diamonds made you rethink your choice? Or are you happy with your choice?
 
I found this discussion of risk, insurance, and lotteries illuminating:

link
 
Date: 10/24/2009 1:48:39 PM
Author: glitterata
I found this discussion of risk, insurance, and lotteries illuminating:


link
Click to expand...

Interesting read, thank you.

However, the object in question isn't something vital: it's just a piece of jewelry. That changes, in my opinion, everything. The example used in the article is a house lost in a fire, which is very different from losing a nonessential item like a diamond.

The premise of the article I agree with, however. You have to gauge what the break-off point is where you're willing to pay for insurance, and for me, it hasn't quite hit me yet.

What is really getting to me are all these posts about chipped and damaged diamonds. I am clearly ignorant about diamonds, as I always heard them harped on as among the hardest substances on earth, etc -- I stupidly took that (as I'm sure many do) to mean it's practically immune from damage. If I could pin down a fact like 25% of all diamonds chip, then I could decide whether or not to insure more easily. The same goes for living in a flood-zone or in Laguna Beach on a cliff where there are constantly landslides... but for items like diamonds, who knows?
 
I didn't mean that that link would answer your question, just that it would give you more tools to think about it.

Diamonds are hard but brittle. It's difficult to scratch them (except with another diamond) but easier to chip them. And they're small and valuable, so it's not that hard to lose them or have them stolen.

How often do these things happen? I don't know, and reading anecdotes won't give you a good sense of the numbers.

It's safe to say that your monthly insurance rate is greater than your monthly likely cost of replacing or repairing your ring. (I didn't express that very well--I hope you know what I mean.) Otherwise the insurance company wouldn't make money.

I figure that my important (to me) jewelry is irreplaceable. I can't buy another ring that my husband put on my finger at our wedding or another ring that belonged to my grandmother. To me the tragedy will be losing the piece, not losing the value. I don't NEED another diamond ring if I lose mine, so if I can't afford to buy a new one, I can do without. I would rather save my insurance money and keep the jewelry in the safe deposit box when I'm not wearing it.

On the other hand, perhaps the insurance premiums would be worth it to you emotionally, for the peace of mind of knowing that anything bad that happened to your jewelry would be the insurance company's problem, not yours.
 
Date: 10/24/2009 1:35:25 PM
Author:Gleam
I am choosing not to insure my 2.5 carat RB solitaire... we got what I think is a good price for it and we can afford to replace it if need be. I chose not to insure because my thoughts on luxury items like rings is that if I can''t afford to replace it, I probably couldn''t really afford it to begin with (just my personal philosophy for my own items). I am just generally anti-insurance for most things, but all the stories of chipped diamonds on here are making me rethink this decision. I had no idea chipping was so common?!?!


Why are you choosing not to insure? And have all the stories about chipped, damaged or lost diamonds made you rethink your choice? Or are you happy with your choice?
Click to expand...

I don''t know how to highlight, so underline will have to do. I see your point, however, just because you can afford to purchase a replacement surely doesn''t mean you''d choose to throw $15K+ out the window if you had the option to recoup it, right? True, any ring/diamond is non-essential, but money lost is money lost to me! If losing the amount it took to purchase your ring is of no concern, then more power to you! I know however, that if I were to lose my ring or the diamond were to chip/crack, the thought of losing the amount of money spent on it originally would make me ill.
 
Also, you never really know if you'll be able to afford it in the future. It's wonderful that you're financially secure enough to afford a replacement now, but who knows where the economy and your assets will be (and where the price of diamonds will go) 10-20 years down the line? Not meant to be rude or anything, just making sure you're considering all possibilities.

I didn't insure my ring for the first 6 months or so after I got it. The fact that it's a princess cut with corners that could easily chip made me more interested in insurance. I guess it's all about how willing you are to pay for peace of mind. Ultimately I decided an insurance premium was a small price to pay for it.

Also think of this...if you lose/break/are robbed of your ring, you have to pay the full cost to replace it. If you get insurance at 2%/year and have the ring for 50 years, you've already paid the cost of replacement. I have no idea how old you are and therefore whether you have 50+ years ahead of you, but that was one of the arguments I had *against* insurance, because I became engaged in my mid-20s and in theory could be paying premiums for 50-70 years. If you're closer to middle age, I think it's more of a financially sound deal. Just something else to think about...

ETA: Oh, about stories of chipped/lost diamonds...yes, I heard several horror stories about chipped princess corners here on PS, and that definitely swayed my decision.
 
Date: 10/24/2009 2:58:48 PM
Author: jstarfireb

Also think of this...if you lose/break/are robbed of your ring, you have to pay the full cost to replace it. If you get insurance at 2%/year and have the ring for 50 years, you've already paid the cost of replacement. I have no idea how old you are and therefore whether you have 50+ years ahead of you, but that was one of the arguments I had *against* insurance, because I became engaged in my mid-20s and in theory could be paying premiums for 50-70 years. If you're closer to middle age, I think it's more of a financially sound deal. Just something else to think about...
Click to expand...

That's a great point about age, jstarfireb. I'm 25.

I also see your point about possibly not being able to afford it in the future because who knows what can happen.

You're right that in reality, the insurance company isn't picking up the cost of the replacement... if you've already paid the insurance company $2,000 in premiums, you're really just putting that towards your potentially lost ring. Let's say a ring cost $7,000... you've already paid $2,000 throughout the years so the insurance company is picking up the last $5,000. You're just paying for your potential replacement on an installment plan when it comes to insurance, unless you use it fairly early on into getting it.

Anyway, I'm not too worried about loss or theft (we live in an urban highrise with good security). I'm mostly worried about damage. My fiance said, "If diamonds chip, then knowing you, your diamond will chip." LOL So maybe I should insure.
 
Date: 10/24/2009 2:28:28 PM
Author: glitterata

I figure that my important (to me) jewelry is irreplaceable. I can''t buy another ring that my husband put on my finger at our wedding or another ring that belonged to my grandmother. To me the tragedy will be losing the piece, not losing the value. I don''t NEED another diamond ring if I lose mine, so if I can''t afford to buy a new one, I can do without. I would rather save my insurance money and keep the jewelry in the safe deposit box when I''m not wearing it.
Click to expand...

Excellent point. I feel exactly the same way.
 
I don''t insure my rings. It''s a conscious decision based on the low risk of anything happening to them: chipping, getting lost or stolen, etc. Too low of a risk for a premium that''s relatively high, in my opinion. So we self-insure and can always decide if we want to spend the money on replacing the rings. With insurance, you almost feel obligated to replace the ring since you''ve been paying premiums all along and you can''t do much else with the payout except replacement or repair. Unless it''s a cash-out policy like Chubb. Then I imagine you could do whatever you want with the money.

Assessing the likelihood of chipping is difficult and really depends on your situation. Are you very physical with the ring? Do you drop the ring often? Does it get bumped a lot? How much does the setting protect the diamond?

When it comes to diamonds, most people confuse hardness with durability. Hardness mostly refers to resistance against scratching. Though diamond is like the 3rd hardest, scratch-resistant thing (yes, 2, maybe 3, other materials are harder--lonsdaleite, aggregated carbon nanorods, and wurtzite boron nitride), it''s not very durable because the crystalline lattice structure may separate along certain planes, i.e., chip or crack.

Since you can self-insure I think that''s the most flexible option. And unlike some insurance companies, you won''t gouge yourself. Instead, channel the premium money into some other productive use. Just for fun, do a break-even calculation and see how many years of premiums will finally equal the present value of your ring. Of course, it''s not really break-even because the value of the ring (and what it costs to replace) will probably go up in the future, but it''s interesting to calculate anyway.

As you decide on insurance, should you let emotions influence your judgment? Maybe. After all, part of what you''re paying the premiums for is the sentimental value. But don''t let sentiment be the major factor. Look at it this way: the insurance companies view this as purely a business transaction, so to some extent you should too. Do a risk assessment to the best of your ability and best of luck with your decision.
 
I think it''s so different for everyone... can you afford to replace it? Even if you can would you rather mitigate the risk? Where you live, how hard you are on your rings, etc. I considered all of these things when I decided to insure.

Like Abril said, I did the math. In my case it will take 36 years of premiums to equal the cost of my e-ring. Knowing what a klutz I am, and how in less than 2 years I''ve already banged my e-ring up quite a bit, it was the best choice for us. Now while I still worry did it chip each time I knock it (and i have a terrible habit of knocking my rings against doors and countertops), I don''t think twice about the cost of replacing it.
 
Date: 10/24/2009 3:43:52 PM
Author: Abril
Just for fun, do a break-even calculation and see how many years of premiums will finally equal the present value of your ring. Of course, it''s not really break-even because the value of the ring (and what it costs to replace) will probably go up in the future, but it''s interesting to calculate anyway.
Click to expand...

So will the premiums.
 
In addition to thinking about whether you have the cash to replace a ring down the road, I also think about whether it is something you would feel comfortable spending the money on at a later date as priorities tend to change. To illustrate, when DH bought my 2+ carat RB, we were both in secure jobs, had bought our first home and were childless. 4 years later, my job is somewhat less secure due to the economy (I work in financial services), we are expecting our first child in a few weeks, and we''d like to relocate to a more expensive area and move to a larger home in the next couple of years. If I lost or damaged my ring today, could we afford to replace it? Well, yes if it''s just a question of whether we have the cash in the bank, we certainly do. But our priorities have somewhat shifted and I would have a hard time parting with 25k to buy a replacement today, even though technically I could afford it. But when I think of my daughter''s education. new home, etc., I don''t think I could spend the money on such a luxury item at this point. However, I have a Chubb insurance policy, and if my ring were lost or damaged, I would definitely replace it with the policy payout. I guess this is not an issue if you have millions in the bank where you wouldn''t have to decide between a ring and other priorities, but for most there will always be competing priorities, and in my experience, jewelry falls down the priority ladder as you get older and gain more responsibilities. That doesn''t mean I love jewelry any less, in fact that''s why I have insurance, because it ensures that I won''t have to make that decision.
 
I agree with Novemberbride! I could afford to replace my ring if it was lost or stolen or chipped, but the question is would I want to. I love my ring, and would be sad if I lost it, but I could live without it.
I wouldn''t want to spend the money again, so I chose to insure. It gives me piece of mind and I am not worried about my ring. I don''t have to lock it up or be afraid to wear it. That makes the insurance
premium worth it to me. I didn''t buy a cash out policy but a replacement on which was a little less.
 
by the way Gleam, I have a 2.57 as well.
 
on my first ering, we spent about $3k which included the ering and wedding band (smaller center diamond). I did not insure. Five years later, my ring has not chipped, I did not lose it or no damage was done to either ring. Five years later we upgrade, probably spent about 8k or 9k after all the setting changes and wedding bands I did chose to insure the Ering only as I''m still uncertain whether I want to continue or not but it is personal and it is somewhat of a lottery, just like life insurance, I hate that as well... oye
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!...
 
Date: 10/24/2009 8:33:28 PM
Author: luv2sparkle
by the way Gleam, I have a 2.57 as well.
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i have a large stone and i insure it for the original purchase price of the stone. i refuse to bump it up every year as well. i figure that the inflation in prices will bump around and the higher cost of insurance premiums will be money kept in our pockets. if we had to replace at least we will recoup or original investment
 
I insure the ones over a certain dollar value that I''ve decided caps the amount that I am willing to lose. My main concern is loss or theft, not damage. I recall a story of a woman who finished working her horse in a huge arena, only to find her setting was minus her (uninsured) 1.5ct brand new diamond when she finished. And one where some people who were injured in an automobile accident were robbed of their jewelry by passers-by before the police and ambulance got there. And other people robbed in elevators, or in parking garages. A friend was sponsoring a child in the "Keep A Child In School" program back in the ''80s, and the kid stole her wedding rings and a family heirloom ring and they were never recovered. You just never know.
 
Insurance is, by it’s nature, on average a losing deal. The companies estimate how much they are going to have to pay out in claims and then set premiums to cover that along with their costs in terms of agents, advertising and other such things and still have a profit left over at the end of the day. That’s just the nature of the product. For people with the financial resources to do so, ‘self insurance’ pays off by avoiding these costs.

That said, there are two tricky areas. The first is in assessing your own risks. The company actuarials are making some estimates of the risks associated with their policies and they do this by evaluating statistics on their clients. This can lead to some difficulties because usually the only things they know about YOUR risk profile is your address and your own claims history. This makes one area where you can game the system is by knowing if your own lifestyle and temperament makes you more or less of a risk than the ‘average’ customer with similar stats to your own. The breakdown of claims is proprietary information but I suspect the biggest risks are accidental loss, theft and breakage. Items that are stored in a vault and worn to a party twice a year have considerably less risk than items that are worn daily and taken on and off frequently for example. Items worn while rock climbing are more risky than items worn to the opera. Some customers are far more likely to leave their ring on the sink at the ballpark than others. It’s hard to do a self-assessment on this sort of thing but it’s an important part of the equation and, at the least, you're in a far better position to evaluate this than the company is.

The other one is the effect that it has on your own behavior. If the risk of loss causes you to worry about the piece and either refuse to wear it or to constantly be checking that it’s still attached to you when you are, you’re undermining the whole purpose of the piece. You’ve converted an asset (a piece of jewelry that you love) into a liability (a source of stress and worry). As with the above, only you can assess this problem but if buying insurance increases your enjoyment of the merchandise by making the risk of loss someone else’s problem then the company has provided more than a purely financial benefit.

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver
 
Date: 10/24/2009 2:32:19 PM
Author: MagsyMay


Date: 10/24/2009 1:35:25 PM
Author:Gleam
I am choosing not to insure my 2.5 carat RB solitaire... we got what I think is a good price for it and we can afford to replace it if need be. I chose not to insure because my thoughts on luxury items like rings is that if I can't afford to replace it, I probably couldn't really afford it to begin with (just my personal philosophy for my own items). I am just generally anti-insurance for most things, but all the stories of chipped diamonds on here are making me rethink this decision. I had no idea chipping was so common?!?!


Why are you choosing not to insure? And have all the stories about chipped, damaged or lost diamonds made you rethink your choice? Or are you happy with your choice?
Click to expand...

I don't know how to highlight, so underline will have to do. I see your point, however, just because you can afford to purchase a replacement surely doesn't mean you'd choose to throw $15K+ out the window if you had the option to recoup it, right? True, any ring/diamond is non-essential, but money lost is money lost to me! If losing the amount it took to purchase your ring is of no concern, then more power to you! I know however, that if I were to lose my ring or the diamond were to chip/crack, the thought of losing the amount of money spent on it originally would make me ill.
Click to expand...
* quick threadjack to help Magsy*

To highlight, depending on what computer you are using, highlight the text you want to colour highlight with the mouse, then click on the box at the top that says ab with the highlight pen and yellow colour, that should yellow highlight your text. You can even change the colour by clicking the triangle to the right of this option, this will bring up a colour palette, select your colour and it will highlight your text as before.
 
Great timing on this post I am debating about this right now. I just bought my 2 1/2 carat ring and I am considering whether to insure. I don''t have insurance for my apartment in NYC because it is a doorman building with great security. A ring over 30k will cost I think around $800 from jewelers mutual. It seems really high to insure. I don''t want to buy a new ring if this one got lost or stolen but I also don''t want to give the insurance company that kind of money which essentially would be the same as buying a new ring over 40 years either (rough numbers I know but it illustrates my point).
 
Date: 10/25/2009 11:26:00 AM
Author: boots7
Great timing on this post I am debating about this right now. I just bought my 2 1/2 carat ring and I am considering whether to insure. I don''t have insurance for my apartment in NYC because it is a doorman building with great security. A ring over 30k will cost I think around $800 from jewelers mutual. It seems really high to insure. I don''t want to buy a new ring if this one got lost or stolen but I also don''t want to give the insurance company that kind of money which essentially would be the same as buying a new ring over 40 years either (rough numbers I know but it illustrates my point).
Click to expand...

That''s how I feel, too. Or not even waiting 40 years -- I mean, in the interim, I throw $1,000 at the insurance company?! That''s a nice pair of diamond earrings!
 
Well I don''t think ability to repay has anything to do with my decision to have insurance, we could rebuy my ring and my other jewelry. Insurance just gives me piece of mind wearing things especially when traveling because we travel alot and I want to be able to enjoy my things. As for living in a building, even one with great security, I think that makes me more likely to have insurance. Somehow I doubt I would be able to collect from the building if someone from the inside or the outside decided to steal from our unit. I also don''t have everything fully insured, just my engagement ring + an extra $5,000 in a policy to cover any other everyday jewelry I might be wearing - actually my rentor''s policy also covers my designer handbags so I don''t have to worry about leaving them in the hotel. (Rentor''s isn''t just about theft its also liability protection in case someone sues you for other reasons, like getting hurt in your place).
 
Winternight - we obviously have different thoughts about insurance. If I was concerned that a friend in my apartment was going to sue me for something happening in my apartment I think I would probably reconsider who I thought was my friend. If it gives you piece of mind then obviously that is what it is for. I understand insurance on a car and a house but for most other items I have a hard time justifying paying for everything I own twice (which is what you do with insurance premiums)

Also, to your point of living in a secure building makes you more likely to get insurance is an interesting point. I don''t think many people would agree with that point. Also, you have to be making good money to live in my building so my neighbors are not going to be breaking into my apartment. It is not a secure building because it is in a bad area.. maybe that is what you think I mean. I can assure you I enjoy everything I own... especially the money I save on insurance
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Do you work for an insurance company??
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Do you take more than one purse when you travel??? I would think designer bags would have a high premium do to easy theft
 
boots- I also live in the city, doorman building, and extra tight security as there''s a politician that lives here as well. I still have insurance. Not because I think I''m going to get robbed, but the insurance covers certain types of damage that your management company may not. For instance, water damage, fire damage etc.

I also have a seperate policy on my e-ring. Like yours it''s also 2 1/2 carats. I took out the policy not because I can''t afford to replace it, but because like winternight said, it gives me peace of mind. Most people who buy brand new cars, even if they''re paying cash outright, insure them. The cost for an expensive diamond can be the same, or in many cases more. I don''t see the difference. Something can happen to your car, something can happen to your ring. If you''re comfortable and don''t give it a second thought, then insurance is not for you. For those of us that are more comfortable knowing that should something happen, it becomes someone else''s headache, insurance works.

There is no wrong or right answer. But people should be aware of all the risks they''re taking, the cost of the policy and their lifestyle. Then make the decision. I don''t look at it like "oh, i''ve saveD some money now i can get an extra piece of jewelry". I look at it like "if I save the cash, and buy another piece of jewelry, now i just have something else to pay for should damage or theft occur".
 
In the past 12 months a very large tree has fallen on our apartment block taking part of the roof and someone's balcony with it on the way down (during a storm) and some of our neighbors set fire to their kitchen.

Luckly our apartment was far enough away from the accidents to escape any damage but several units suffered extensive water damage to carpets, electronics, furniture and other personal belongings and I never found out what happened in terms of the fire but know they had to fix a door and window at least since the fire department broke in, probably had to replace their kitchen, appliances and other things due to smoke damage.

I'm not very worried about theft as generally home thieves don't take everything of value at once, we don't have much worth stealing and I doubt any thief would make more than one trip up and down our stairs. If there was a fire or storm damage or even accidental flooding though I would hate to lose everything and not have any financial support to fall back on. When you walk around your apartment adding up the cost of replacing things it becomes a bit scary.

As for my ring. I am torn about insurance at the moment. At this stage I am leaning towards it as if my ring wasn't insured and I lost it while I can afford to replace it I probably wouldn't be able to justify it and chose not to. Also having it insured would make me less paranoid too and I'd be able to enjoy it more I think.
 
For those who have made a claim in the past to their jeweler insurer, have your premiums gone up afterwards like they do with car insurance or I hear with homeowners?
 
From Denver Appraiser:

The other one is the effect that it has on your own behavior. If the risk of loss causes you to worry about the piece and either refuse to wear it or to constantly be checking that it’s still attached to you when you are, you’re undermining the whole purpose of the piece. You’ve converted an asset (a piece of jewelry that you love) into a liability (a source of stress and worry). As with the above, only you can assess this problem but if buying insurance increases your enjoyment of the merchandise by making the risk of loss someone else’s problem then the company has provided more than a purely financial benefit.

---

That it, right there for me. If it wasn''t insured it would just sit in the safe deposit box. That would be silly.
 
Insuring a home or car is completely different than insuring a diamond ring, unless you're the kind of person who likes to simply insure everything. It's an analogy only so much as it speaks about a poster's mindset. I'm the opposite: back when I needed a car in the suburbs, I did not even have collision insurance (in which repairs are covered for your own car or a replacement if need be), just enough basic and liability insurance to meet my state's laws. Clearly others here prefer more insurance.

At the end of the day, it is a personal call. Denverappraiser has it right... if it's going to sit in a safety deposit box because you're scared to wear it, probably best to insure it. I guess at this point I just don't have that kind of paranoia, EXCEPT when reading the stories about chipped and damaged diamonds. Those stories give me goosebumps.
 
I insure all my jewelry. While I have the resources to replace it all I would be extremely expensive. I saw both my Aunt and my Mother have all their jewelry stolen. Not at the same time about 20 years apart. I recently lost an earring, it is nice that my insurance will buy me a new pair. I think it is a personal choice but I prefer having insurance.
 
No, I''m an attorney. First year of law school in torts class our professor went over all the reasons we should have at minimum rentor''s insurance with coverage for medical. It doesn''t matter how great your friend is what if they are in your apartment, maybe at a party, and some freak thing happens. Or really its not just about friends, what if someone delivering something or doing work on your place hurts themselves? Or what if your friend drinking at your party drinks too much and gets in an accident? I don''t know, lots of what ifs that could bankrupt a person easily.

I didn''t really mean my building security makes me more likely to get insurance, I guess I just meant that because I''m not in a house where I can control access I don''t know who is coming into my unit.

My bags are covered under my rentor''s policy, so its nothing extra. And yeah I tend to take more then one when I travel since I carry evening as well as day bags.

Not really sure why my post seems to have rubbed you the wrong way. Maybe I didn''t read the thread carefully and shouldn''t have posted since I do have insurance.
 
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