Snood dog (Photo credit: Wikipedia)
Pretty weird title right? It actually comes from the classic Batman TV series starring Adam West and Burt Ward. Burt Ward’s character, Robin was notorious for his exclamations categorizing different objects or dilemmas as righteous.
How does this relate to financial planning? We all have our snoods that we collect or have value to us. When we purchase renters or homeowners insurance, we often assume that our personal property is covered under the specified limits on the policy. Normally this is 50% of the home’s insured value.
But it pays to read the fine print. Most policies will only allow for coverage for certain items and only for specific limits. For example, a typical home insurance policy will cover jewelry only up to $1,000 total – for all of the jewelry you own. In order to have coverage for a specific item of jewelry such as a wedding ring, engagement ring, or necklace an endorsement is required.
Think of an endorsement as a “mini insurance policy” specifically for the item covered. For a wedding ring, it would be a policy within your existing homeowners or renters policy that covers only the ring, subject to its own deductible and often much more broad types of coverage. This means that in a normal home policy without an endorsement one could lose their ring, have the stone fall out, etc. This is known as mysterious disappearance and is generally not covered under the basic home policy.
With an endorsement, the ring could be lost, or a stone could fall out and the endorsement will likely cover that loss – subject to the endorsements deductible which is typically less that the home policy deductible.
The same is true for other items such as art, coins, trading cards, silverware, furs, antiques, firearms, and yes, priceless collections of Etruscan snoods. I have even had friends need a specific endorsement for the grand piano in their living room.
Most insurance carriers will require an independent appraisal to endorse high-ticket items like jewelry, antiques, coins, etc.
Check your policy and make sure your snoods are covered. If not, contact your insurance carrier and see what needs to be done to get them added. Your premiums will undoubtedly increase, but you’ll have peace of mind knowing your snoods are covered.
