Personal Property Floaters

Personal Property Floaters are also known as Scheduled Personal Property, Personal Property Floater Insurance, and the many other marketing names used by insurance companies. This form of insurance is what we in the insurance business call, Inland Marine or Floaters.

It would seem to be an oxymoron to call something inland marine when we all know marine means something to do with the sea. That is exactly why it was called that. Three hundred years ago, there was only one type of insurance – gambling really. Some rich guys hanging out at a coffee shop overlooking the harbor in Liverpool called Lloyd’s would bet that a sailing ship would go down at sea. Some other guys would take their bet, and that was the start of what we now know of as insurance. It was a form of marine insurance because it covered “perils of the sea”. It started when the ship left port and ended when the ship arrived. When the shipped good were unloaded and placed on barges and then transported up the rivers, then to wagons, it was uninsured. The barges sank, caught on fire, and stuff was stolen, so there became a need for a new form of insurance: Inland marine was born. It has the same type of “all-risk” coverage that marine insurance has, but covers anything that can be moved around inland. Today, this form of insurance is used to cover construction equipment that can be anywhere in the world, molds and patterns, and many other industrial applications. It is also used for golf clubs, jewelry, and cameras. A form of it is used for the Comprehensive coverage of your car insurance. This type of insurance differs from what later developed as Property Insurance because it is insuring things that are not always at one location.

Why do you need to know about Personal Property Floater?

It is not necessary to give your insurance company a complete list of every valuable thing you own. Your Homeowners insurance covers many of these items under the content part of your policy. But, when you drop an expensive rifle down a mountain side, or you loose a diamond from its setting, the Homeowners policy is not going to be much help.

Homeowners policies have limits on the dollar amount and type of loss that can be recovered, Personal Property Floaters insurance lists the items insured at the value of its replacement.

When would a Personal Property Floater be needed?

The protection provided for personal property under the typical Homeowners policy is very broad, and includes coverage for your furniture, clothing, and appliances. In addition, it provides limited coverage for such items as jewelry, silverware, furs, and firearms. However, it may not cover some types of loss that may be important to you, such as the stone falling out of your diamond ring, your antique statue that is accidentally broken, or a flood that damages your personal computer. In fact, most homeowners policies set dollar limits on the amount of protection offered to cover the theft of items such as jewelry or furs ( usually only up to $1,000), firearms (up to $2,000), or silverware (up to $2,500). Optional add-on coverage to the homeowners is available to enhance coverage by providing higher amounts and expanded protection for special property. This usually provides most homeowners with enough coverage.

However, if you own extremely Personal Property Floater, this still may not be enough coverage. For example, if you own a diamond ring valued over $10,000 or a collection of fine arts valued over $50,000, you need more protection and should consider buying a Personal Property Floater.

What kind of property can be covered?

Many different types of possessions can be accommodated by the Personal Property Floater policy. Here's a quick listing of some of the items typically covered:

Cameras (video or still) and related equipment
China and crystal
Coins (rare and current)
Firearms
Furs
Golfer's equipment
Jewelry
Musical instruments
Personal computers
Stamps (rare and current)
Silverware
Works of fine art, including paintings, etchings, pictures and other bona fide works of art (such as oriental rugs, statuary, rare books, manuscripts and bric-a-brac) of rarity, historical value or artistic merit.

If you own something of value that is not listed above, it may still be eligible for coverage. You may want to discuss this with us. Some things cannot be insured through this form of insurance. Artifacts and rare irreplaceable item may not qualify because it may be impossible to find a replacement or establish its value.

Broad coverage

A Personal Property Floater allows you to purchase better protection for your special property than would be available under the typical Homeowners policy. In addition to being able to purchase higher limits of coverage, more perils are covered, and you receive worldwide coverage, including protection against mysterious disappearance. (Please be aware, however, that fine arts are only covered within the United States and Canada.) The policy also may be expanded to include loss due to breakage, something that is not available under the terms of a Homeowners policy. That means, if you accidentally break something of a delicate or fragile nature, you're automatically covered! Although no deductibles apply to many types of losses, a $100 deductible may be applied to breakage caused by certain perils.

Scheduling your property

Once you've contacted us to begin Personal Property Floater coverage, you will be asked to list all the items that you'd like to insure. Smaller items, in many cases, need not be listed individually and what is called "blanket" coverage may be required. This list, or "schedule," would include a detailed description of each item and the appraised value. In some instances, a copy of a current appraisal, conducted within the past three years, may also be required. This detailed schedule is attached to your policy. Your premium is then based on the total amount for which your special property is valued.

Though it isn't required for your policy, you may want to photograph each piece in your collection and store the photos in a safe place. If your entire collection is stolen or damaged, it will be easy to remember each item for your claim report.

Newly acquired property

Your Personal Property Floater policy automatically insures most newly purchased possessions up to 25% of the total amount of insurance already scheduled (or $10,000, whichever is less ) for up to 30 days from the date of acquisition. In the case of fine arts, you have up to 90 days to notify the agent. The benefit: you don't have to worry about insuring your new item the moment you receive it. However, because this automatic coverage is only good for a short time, don't wait too long, you might forget!

Let's say that you purchase an expensive new lens to add to your currently insured camera collection. One day later, and before you have had a chance to ask your agent to add it to your policy, your camera and new lens is stolen. With a Personal Property Floater policy, both items are covered!

Loss Settlement

Since items of this nature vary so widely, losses are settled differently, depending on the type of property insured. For jewelry and fine arts, in the case of a total loss to a scheduled, appraised item, you are reimbursed for the agreed value shown on your policy.

For other classes of property on the policy (such as furs, silverware, cameras, and personal computers) the value is not already agreed upon, and the value of your property will be determined at the time of the loss. You will then be reimbursed for either the:

actual cash value of your property, or
cost to reasonably repair your property to it's previous condition, or
cost to replace your property with a substantially identical item, or
the applicable amount of insurance.
whichever of these is less.

Loss to a pair or set coverage

Should you lose a jewelry or fine art item that belongs to a pair or set, you'll receive the full amount for the complete pair or set as long as you agree to return the remaining parts to your insurer. Slightly different options may exist for lost pairs or sets of other types of property. You should read your policy for the exact loss settlement provisions.

Summary:

In addition to insurance and depending on the value of your property, certain security measures for your residence, such as an alarm system, may be required.

We do recommend this type of insurance when people have valuable things. The cost is not prohibitive. Usually, you will pay less than 1% of the value of the insured items (Musical Instruments - .35, Jewelry – 1.05, Stamps - .45, Golf equipment - .60, Coins and collectibles - .76). If you paid that premium for 100 years, you would have paid the insurance company as much as they would have paid out had you had the loss. The premium is quite reasonable when you think of it in those terms.