USAA Insurance Claim Experience

[ZhenyaH]

I've been mostly a lurker but benefited tremendously from this site. I wanted to share something in return so that other PS members can learn from this forum as I have throughout the years.

Back on Dec 15th, I realized that the diamond from my e-ring was missing. I was in a meeting when I looked down to my hand and noticed the big gaping hole. I called USAA to file a claim that night, crying on the phone. Here's the process that was outlined to me:

1) USAA will try to find a similar diamond
1A) If I accept the diamond that USAA finds, then I can have it shipped to me and USAA will pay to have it set or
1B) I can accept the diamond that USAA finds, I send in my e-ring setting and they'll set it for me or

2) I can accept the cash value of the replacement stone.

It was option #2 that worried me. I did not feel comfortable USAA finding a similar stone for me because I would not have had the opportunity to review the specs/certificate until the stone is selected and shipped to me. As for option #2, the replacement value is not the same as the amount that the ring (or the diamond) was insured for. The replacement value would be determined by USAA's whole sale price, which would be significantly lower than what you'd pay retail.

The stone, which was a 1.03 carat radiant cut (SI1, G), was purchased for approximately $5000 from a BM store (definitely before I discovered PS), I believe. Its cut was good, (shallow depth) so it appeared bigger (all of which I learned later). A similar stone today from any of the PS vendors would cost $3-4K.

Because of the holidays, it took a while for the claim to be processed.

On Monday, I found out the cash value of the claim and it was approximately $4200 total. I opted for the cash value and the amount has been deposited into my account already. All I needed to do in return was to submit photos of the ring, showing the damage.

All in all, I'm completely ecstatic with the USAA claim process. I wish it had taken less than the length it took but I understand with two major holidays, it was going to take long.

If you had any questions/doubts about going with USAA, I hope my experience can help you.

Thanks, PS!

Ps: I ordered a diamond from James Allen and I will post it separately once I have it set.

 

[missydebby]

Thanks for sharing that. I am soooo glad it worked out for you. You mustve been having a heart attack

Can't wait to see your new diamond. Are you going for the same size/shape in the same setting?

 

[NiceSmile]

Can anyone get USAA insurance on their diamond?

 

[tyty333]

I think you have to be in the military or have a connection (spouse, parent is/was in military).

 

[SB621]

I LOVE USAA!!! I have made 2 claims with them over 5 years for a diamond pendant and my FLY ring. Both times they were wonderful to deal with and just cut me checks for what I insured the ring for (not purchase price or appraisal price!).

Both of my pieces were custom made so they pretty much just asked right off the bat if I wanted a replacement or if I just wanted the check to do my own custom piece again. I love working with them and their prices are very competitive for insurance.

 

[SB621]

I think you have to be in the military or have a connection (spouse, parent is/was in military).

Only for certain USAA services do you need to be active duty or related to someone who is. Insurance is not one of them. Anyone can go to USAA for valuable personal property insurance.

 

[denverappraiser]

And THAT, boys and girls, is why you should insist on a competent appraisal even if your insurance company doesn't. They are restating the value of the piece based on what they think it will cost them to replace and this estimation is based on the description provided by you when you submitted the appraisal. They are using the appraisers value when it suits them to calculate premiums and then using their own valuation methods when they actually have to pay out a claim.

 

[heididdl]

appraisals.....

 

[Lenovo]

So you should appraise a diamond before you buy it or after you buy it? I am little slow here lol

 

[Christina...]

So you should appraise a diamond before you buy it or after you buy it? I am little slow here lol

After. But you want a fair appraisal of the actual cost to replace the stone with like kind. Often times appraisals are valued for much more than you could replace the stone for. This is done to make you feel that you got a good deal on the stone, or because you want to sell the stone and make the purchaser feel as though THEY are getting a good deal.

Your premiums are based on the appraisal submitted to your insurance company. If your appraisal says that the stone is worth $12000 but you only paid $6000, then you are paying higher premiums and when the time comes to make a claim, the insurance company will not base their payout on the appraisal amount but instead on their wholesale replacement cost. So, it makes sense to only cover the stone for the actual replacement cost instead of some inflated feel good amount.

DA is much more articulate than I am, so hopefully he will come back and explain more.

 

[denverappraiser]

The purpose of an insurance replacement appraisal is twofold. First is to define and document exactly what you have for purposes of replacement in the case of a loss and the second is to provide funding to allow that to happen. Problems are common with both parts. In the case of the first, the description is going to be used as a purchase order for the replacement, just like is being discussed in this thread. The company is agreeing to replace your item with another of ‘like kind and quality’ or words to that effect or pay whatever it would cost them to do that. They are NOT agreeing to pay the face value of the policy in the case of a loss (usually). This means that the description and photographs are the real bottom line. If you have a loss, they will send it to a replacement jeweler, in the case of USAA this is a division of the company, and they’ll attempt to meet or exceed each of the specs provided. If it’s not in there they won’t do it. If it’s unclear or ambiguous, they’ll do whatever is cheapest. It benefits you enormously to have a very detailed description for this reason. One picture is not enough. A grading report on the center diamond is not enough. Frankly, most ‘appraisers’ do an appallingly bad job and insurance companies are more than happy to accept it. Weak appraisals benefit them. It’s not the insurers who should be being picky, it’s the insured.

The second part is the price, and it’s related. Again as pointed out in the discussion above, the insurer is agreeing to replace the item with another but if they can’t come to an agreement about this, plan B is to pay in case the amount that it would have cost them to do it. This means THEIR cost to replace, not your cost and not what the appraiser estimated retail to be. Appraisers tend to inflate values. This is for a couple of reasons but mostly it’s because people like it. It makes them feel like they got a bargain. It makes the store look good. No one gets upset. There are other reasons by the way, some of them pretty good. An appraiser is estimating value on some as yet unknown future loss date. Failing psychic powers, that includes a buffer for inflation. Replacement labor can also be a tricky issue. The original piece may have been made in a production cycle in a Chinese factory and the replacement may need to be custom made with US labor.

I digress. The premiums you pay are based on a percentage of the declared value. It’s usually between 1% and 3% per year depending on things like your address, claims history, coverage details and such. That is to say, non-gemological things. The amount they pay in the case of a loss is about that description. Insurance carriers are pretty savvy people, they hire professional shoppers and they really do know what things cost. They’re a gigantic client for their partners and they use their weight to beat up the suppliers. They pay as little as they can, as well they should. As long as what it costs is less than the face value of the policy, all is well. They pay up and the ‘extra’, to the extent that there is any, is theirs to keep. If it costs more then you are underinsured and they’ll pay the face value.

Let’s do an example. If you buy a ring for, say, $10,000 that’s ‘worth’ $30,000, did you get a bargain? Maybe, but probably not, at least not by that much. If you can get it for $10k, your insurer probably can too. You insure it for $30k, wait for a few years, lose it and file a claim for a replacement. The appraisal says 1 carat G/VS2 diamond in 14k ring. They can replace that for $6k. The appraisal omitted the h&a, the designer of the ring, the half carat of micropave melee, etc. Yikes! Even though it would have cost them $15k to actually replace what you lost, you get burned. That’s where a good description and photos will help you but wut what about that other $15k – the margin between what a legitimate replacement would have cost and the amount you’ve been paying premiums on for years? What about the ‘bargain’? Usually that’s lost or, more specifically, it was never there in the first place. What’s lost is the years of premiums you’ve been paying for coverage that won’t result in payment even in the case of a loss. That’s not insurance, that’s a gift to the company. I understand why they go along with it, wouldn’t you? High value conclusions benefit them and pretty much the higher the better. It’s consumers who should be howling.

 

[d-dot]

Would this work for a 25k Rolex. is it known the average cost/value or should i still get a detailed appraisal?

 

[VRBeauty]

This is very timely - I was thinking just this morning that it's time for me to get my jewelry insured. Thanks for posting, ZH, and thanks to everyone who provided expert input!

 

[JoshuaNiamehr]

**edited by moderator, no promoting other businesses to keep the forum unbiased please**

Id also check to see if they offer international coverage - if I remember correctly, they do not.

**edited by moderator, no promoting other businesses to keep the forum unbiased please**

Have a great appraisal, but also make sure you are dealing with a great insurance company too. Weigh your options carefully. Be sure to check the terms and conditions, whats covered and whats not and if you get to choose your jeweler, or if they cut you a check etc.

**edited by moderator, no promoting other businesses to keep the forum unbiased please**

 

[JoshuaNiamehr]

Would this work for a 25k Rolex. is it known the average cost/value or should i still get a detailed appraisal?

I would get a detailed appraisal (I did for mine) with the serial number and authenticity checked out by an independent appraiser so there is no question to the validity. I would especially recommend this when purchasing a used/pre-owned/second hand/pawned etc etc etc pricey watch.

 

[mikew33]

I **edited**s.

I recently purchased an engagement ring and had it insured through USAA. I know what you said about not covering internationally to not be true. I proposed in Rome so I made sure to clarify with USAA that it would be covered if something were to happen to it while in Italy and they said it certainly would be covered anywhere in the world. Overall my experience with USAA has been great and I would highly recommend them.

 

[MollyMalone]

Awesome! and congrats and very good to know! I forget which doesnt offer international coverage

I think most, if not all, US personal jewelry insurance policies now cover loss that happens while traveling abroad, but only one of the insurers available to ordinary people -- Jewelers Mutual -- will issue a policy to non-US residents, and that underwriting is limited to Canadians, i.e., JM doesn't offer personal jewelry insurance to, e.g., those living in Australia.