Is valuable personal property insurance worth it?

[brandrea]

Just out of curiosity, why are watches so much more expensive than homes to insure? Is it the size of the market, risk etc?

I realize the insurance companies have actuaries who’ve crunched all the numbers but here the cost of insuring a home (relatively speaking) is a fraction of the cost...

OP to answer your question, I don’t insure my watches (I used to, but got tired of the premiums). I do insure our home

[JParm]

Originally Posted by Boopie

As I understand it, in the event of a theft/loss my insurance carrier will cut a check for the amount the watch is insured for; they won’t source a replacement watch for me, and if I decide never to replace it, that’s on me. Obviously the premium is based on the insured value. So, whether we insure our 16710 for $5k or $15k, we’d get a check for the insured amount. If I choose to insure a 16710 for only $5k, I can’t cry that I can’t buy a replacement for that amount.

I got an appraisal done on 16710 a couple years ago and it's quoted at 10k; my insurance will pay that amount out (I've asked).

Originally Posted by Boopie

Check and see if your insurance company does require that. Mine doesn’t, but I do need to provide a serial #.

I upload photos of my watch / papers / receipts, and that covers that.

[HippoPAPAmus]

I have to send in photos of the watch / paperwork / appraisal using the company’s app which verifies my location to ensure I’m doing so from the address listed on my policy. After that everything goes to underwriting. It’s a very simple process.


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[CashGap]

Originally Posted by brandrea

Just out of curiosity, why are watches so much more expensive than homes to insure? Is it the size of the market, risk etc?

All of that. Let me see what I can think of...

1 - Small transactions, less efficient, requires higher ratio of premium/value to hold ROI.
2 - More likelihood of loss, few people file claims for losing their house or having it stolen.
3 - More opportunity for fraud. Tougher to fake a house title than a watch receipt.
4 - Less sensitivity to price. People insuring houses are across the financial spectrum, those insuring watches are less price sensitive.
5 - More likelihood that loss is total loss rather than partial loss.

Probably 15 more factors?

[Etschell]

Originally Posted by brandrea

Just out of curiosity, why are watches so much more expensive than homes to insure? Is it the size of the market, risk etc?

I realize the insurance companies have actuaries who’ve crunched all the numbers but here the cost of insuring a home (relatively speaking) is a fraction of the cost...

OP to answer your question, I don’t insure my watches (I used to, but got tired of the premiums). I do insure our home

harder to steal a house and the largest risk is singular which is fire, unless you are in a hurricane zone. still fire is the largest risk.

a watch is a small item that a lot can happen to.

that said on lower value watches self insurance has its benefits. higher ticket items just depends on one's pain tolerance.

[TC94]

Originally Posted by beshannon

Sorry I disagree.

Counting deductibles for claims, you would still be ahead if something were lost/stolen/destroyed.

There is no way I could take my Jewelers Mutual premiums and turn it into one watch value let alone an entire collection. Plus I don't have to worry about the principal that is contantly at risk in the markets.

I said ALL forms of insurance combined will add up to quite a bit. Since I don’t know which type of disaster will strike, I forego ALL forms of extra insurance. My wife and I calculated that, even after a few personal losses, we’d saved over $35k by 2015. We haven’t done th math since.

That’s $35k net after subtracting the few loss claims we made from our own funds.

If you insure, then you have to insure everything because you don’t know what will be lost or stolen, or which car will breakdown, or what trip will be interrupted.

But if you never insure, you statistically stand a great chance of being way ahead later in life. That’s why insurance is so profitable, and why the best money managers tell you not to buy all those extras.