Do I Really Need Engagement Ring Insurance?

Getting engaged? There are a lot of details to keep track of beyond whether or not your ring is properly insured. However, research shows that engagement rings are one of the least often covered but most often lost or damaged pieces of personal property an individual can own.

In this article, we dive into the data behind why you should insure your engagement ring, and provide some tips for how to get started.

The Numerical Value of an Engagement Ring

Although engagement ring styles have varied over the last 100 years, the most common type of ring is a diamond. In fact, research shows that over 90% of individuals stated that they wanted a natural diamond as the center stone in their ideal engagement ring.

Diamonds, of course, are known for being expensive. High prices help drive their allure and make the idea of receiving a diamond even more special. Yet the cost of these gems only continues to rise over time. In fact, data shows that the diamond industry will average $39.7 billion in sales by 2027—an all-time high for the stone.

As prices increase, naturally the budget that couples must set aside for a ring has grown as well. In 2019 the average budget for an engagement ring was $7,400, jumping up to $9,500 in 2022.

Despite a commitment to paying the market price for a diamond, research shows that more than 70% of people making the purchase indicate existing debt, making the choice to invest money into an engagement ring all the more significant.

Did You Know: Engagement ring purchases often equate to an individual’s largest purchase in life outside of a house or a car.

How much is my engagement ring worth?

Before you can properly appreciate the value of protection for your ring, it’s first important to understand how much the piece is actually worth. This is different than the amount it was sold for, considering jewelers at different establishments are able to set their prices as they see fit.

In order to determine the worth of your engagement ring, you can ask for a detailed sales receipt at the time of purchase. If you’re using a family heirloom for an engagement ring or don’t have the opportunity to ask the jewelry directly, consider getting an official appraisal of the piece. An appraisal will indicate important information about the piece of jewelry that declares its value, such as your diamond’s cut, color, clarity, and carat weight.

Keep In Mind: The value of your jewelry can change over time, so it’s a good idea to get a new appraisal once every three years to make sure your item is insured for the current value.

“What Happened to My Engagement Ring?”

For a few weeks or even months after a proposal, your engagement ring might feel like the most important item you own. Alongside being the topic of almost every conversation, it might take some time to adjust to having such an expensive piece of jewelry constantly on your finger.

Because the ring spends so much time in the spotlight right after engagement, couples often fall into a false sense of security when it comes to its safety. They convince themselves they would notice if the ring suddenly wasn’t on their hand or if one of the stones went missing, and don’t give their ring’s safety much of a second thought.

Yet of those polled on their engagement ring care and maintenance, 31% indicated they had lost expensive jewelry like this, 22% said they’d had it break, and 16% said they experienced both. What’s more, almost a quarter of men and 14% of women admitted to losing their wedding ring itself at some point in their marriage.

This is where proper insurance comes in. An insurance policy can help protect your investment in case of the unexpected. Below, we dive into exactly how engagement ring insurance works and why it’s an important step in the engagement ring purchase experience.

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Do I really need engagement ring insurance?

The short answer is: yes.

According to a recent study, two thirds of those who invested in engagement ring insurance had to use it within 10 years of purchasing it. At the same time, those without insurance were left to pay out-of-pocket to replace this precious possession after it was stolen or misplaced.

Engagement Ring Insurance vs. Warranty

Some jewelers offer a warranty on an engagement ring purchase. Warranties are conditional statements of quality that are set in place for a specific amount of time. Typically they cover manufacturing defects, imperfections in design, resizing, and cleanings during the allotted window after purchase. In some cases, this window is a few months, in others it can be up to a year; it all depends on the jeweler.

Although a warranty is certainly better than no protection at all, there are many occurrences that are not covered by this form of protection. Some of the most common include:

Wear and tear

Discoloration

Bent or missing features

Loss of stone

Theft

Transfer of ownership

Repairs or maintenance by anyone outside of the original seller

Instead, all of these occurrences would still require payment out-of-pocket if you only have a warranty on your engagement ring.

Engagement ring insurance on the other hand, is designed to protect policyholders from all kinds of unexpected issues, including if a ring is damaged, lost, stolen, or mysteriously disappears. Though all insurance policies won’t cover the ring maintenance that a warranty does, the comfort that comes with having this additional layer of protection in case something more drastic happens is undeniable.

Should I insure my engagement ring under my homeowner’s or renter’s insurance policy?

Most basic homeowner and renter’s insurance polices do include coverage of personal items like engagement rings. However, if the value of the item in question exceeds a certain amount—usually averaging $1,500, depending on the details of your specific policy—then it’s important to invest in additional engagement ring insurance as well.

For Example: Let’s say you spent $9,500 on an engagement ring. If you insure that ring under your homeowner’s policy and it gets stolen, your policy might pay $1,500 toward the replacement of the ring. That will leave $8,000 for you to cover out-of-pocket in order to replace the ring.

Instead consider scheduled personal property insurance—an endorsement that can be easily added onto your existing homeowners or renters insurance policy. Learn more about scheduled personal property insurance in the section below.

Protect your Investment with Engagement Ring Insurance

Though a policy specifically designed to protect engagement rings may not exist, scheduled personal property insurance is the form of coverage that you need in order to fully protect this investment. This endorsement is designed to provide broader coverage on an all-risk basis to help fill in some of the gaps and exclusions within your existing homeowner or renter’s insurance policies.

This means that if you lose or damage your ring and your homeowner’s policy only covers $1,500 of the total repair bill, your personal property endorsement will fill in the gap and cover the rest.

At Central, scheduled personal property coverage is a very popular and valued form of protection among our policyholders. Alongside jewelry, these policies can protect fine art, furs, guns, and musical instruments among other high-price items. This form of coverage can be written on an itemized (agreed value) basis or on a “blanket” basis, and loss settlement is based upon the type of coverage selected.

Get in touch with your insurance agent today to learn more about Central’s scheduled personal property coverage, and get personalized advice on any other changes or additions you should make to your insurance policies now that you’re getting married.

The information above is of a general nature and your policy and coverages provided may differ from the examples provided. Please read your policy in its entirety to determine your actual coverage available.

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