What Are Riders? And Do I Need Them?

Have you looked closely at your homeowner's insurance policy? It may not cover as much as you think it does. There are limits for personal items, and they are lower than many people expect. For example, most policies have a limit of less than $2,000 worth of coverage for all jewelry and furs. Total, not for each item. In other words, if you own an engagement ring, a pretty necklace, and your grandmother’s ancient mink stole, you’ve already more than maxed out your coverage. So, what should you do?

A lot of people make the point that many personal items can’t be replaced at any cost, because of their sentimental value. That’s true, and there’s nothing you can do about it. But if your great grandfather’s vintage Patek Philippe watch is stolen, you might as well enjoy a new car with the insurance money. Or put it in your kid’s college account or your own retirement fund.  Great Grandpa might even want it that way.

For a minimal cost each year, usually between .75 and 3 percent of the replacement cost, you can add riders to your homeowner's insurance policy to cover valuable individual items. You will need to get certified appraisals for your insurance company. Ask your insurance agent exactly what they’ll need from you, then go to a reputable jeweler (or silver shop, or furrier) to get your items appraised or for a referral.

If you’re a renter, your landlord’s insurance likely won’t cover all of your personal belongings. You can get a policy on your own, usually, for just a few dollars a month, that will cover your things if they are lost or damaged. You may not want to pay more for insurance than you’re already paying, but you’ll be glad you did if something happens.