Are My Holiday Gifts Covered by Insurance?
Updated December 4, 2019 . AmFam Team
The holidays and special occasions are about so much more than the size of the gifts you receive. But sometimes a really big present adds extra excitement to the day. If you were given a generous gift — congratulations! In addition to sentimental value, that gift has financial value and should be protected, just in case anything happens. Is it already covered by insurance you have or do you need more coverage? Let’s look at some possible scenarios.
What Does Your Homeowners or Renters Insurance Cover?
If you already have renters insurance or homeowners insurance, then most of your big-ticket gifts are already covered. This means that new big screen TV, cool gaming system, expensive designer purse or fancy coat may already be protected. In most situations, if you have a fire, a flood, theft or other event that is covered by your insurance, then your possessions are protected for as much as your policy allows. This typically means there is a limit on the amount you’ll get for certain property, so you may need to add more coverage. With scheduled personal property insurance, you’ll get coverage that helps protect the financial value of your gift. You’ll also want to check to see if there’s a deductible that applies.
Another thing to consider is whether your insurance covers the replacement cost or the actual cash value of your property. Actual cash value refers to the estimate of what the fair market value of the item was at the time of its loss. Replacement cost is the estimate of what it will cost to repair or replace the item with a new one. Check in with your agent to make sure you have coverage that includes replacement cost or actual cash value, because actual cash value considers depreciation in the value of the item while replacement cost does not.
Did You Get Jewelry for the Holidays?
If you received jewelry as a present, you probably already have some coverage under your homeowners or renters insurance. But that coverage may be limited, just as it is with any electronics or other high value gifts you received. It’s not the easiest question to ask, but, if you can determine the value of the jewelry, you can get a better idea of whether you should itemize — or schedule — your jewelry. This type of personal property coverage broadens what you’re covered for by insuring your jewelry against all losses except those that are specifically excluded by your policy.
A chat with your insurance agent can help you understand your current jewelry coverage and if you need more protection.
To determine how much personal property coverage you need for your new jewelry, make sure you know its value. Whether that’s its purchase price or appraisal value, take that number and make sure to purchase enough coverage to finance the cost of replacing your jewelry. And if you plan to travel with this particular gift or are prone to losing things, a scheduled personal property endorsement can help protect your jewelry’s value should it be lost.
Did You Get a Car for the Holidays?
The really big bows are saved for one special purchase — a new car! While you may be thrilled to find that big bow in your driveway, you’ll see that this present has some special considerations, too. Cars are a little different than other big holiday gifts — they come with legal requirements. While there are a few more steps involved, the dealer is probably more than happy to help you give this memorable gift.
Car title
If the giver is going to be on the title, then it’s a little easier to navigate the paperwork. If the giver isn’t on the title, you’ll need to get a copy of the recipient’s driver’s license and current insurance. This will require a little extra stealth, but it’ll be worth the surprise. Remember that the titleholder is the named insured for their insurance policy.
IRS forms
If the value of the vehicle is over $10,000 and the recipient and giver are not married, the recipient will need to complete an IRS cash reporting form. This can wait until after the gift is given, so it won’t need to ruin the surprise, but the gift will have to be reported on their taxes.
Additional paperwork
Heads up that there may be additional forms required by the state or the dealership. Check to make sure everything is filled out and in order so you can all enjoy the moment!
Car insurance
Another thing to consider is car insurance. The car insurance may depend on the relationship of the giver to the recipient, the lien company and the recipient’s current insurance. If the giver is not going to be on the insurance it might be more difficult to insure. In this situation, talk to the dealership. They may have a solution for you and, in some situations, they can put a dealer license plate on the car for overnight delivery and then insurance can be arranged in the morning. It’s also best to connect with your American Family Insurance agent to let them know you received a car as a gift to make sure it’s insured properly before hitting the road.
No matter what gift you received, it’s a great idea to check your insurance policy to see how your personal property is covered and if you need to add more coverage. Each policy is different, so it’s smart to know what your particular policy covers.
If you’ve already taken the proactive step of creating a home inventory, make sure you update it to include your cherished, new gifts. If anything ever happens, you’ll be thankful you’ve included that new big screen TV, expensive purse, exciting gaming system or whatever big gift you were given on your inventory. Your American Family Insurance agent (Opens in a new tab) can help you add more coverage if you need it.
Related Articles
- 9 Steps to Create a Home Inventory for Insurance Claims
Your home is more than a roof over your head. It’s where your dreams grow, your family thrives and memories are made. But the possessions you keep inside are important, too.
Whether you’re renting an apartment or own your home, you’ve most likely got an insurance policy designed to protect your dwelling and the things inside. Should the unthinkable happen and you have to use that insurance policy, it’s important to have a plan in place. And a home inventory list is a great way to get started!
We’ll walk you through how to create a home inventory so — in the event of the unexpected — you’ll be more prepared and have a streamlined recovery.
What Is a Home Inventory?
Quite simply, a home inventory is a complete list of all the items, especially valuables, in and around your home. The best home inventories include photos, descriptions and dollar values of each of your belongings. The more detail, the better! It’ll help you provide a comprehensive list to your agent of items lost in the event your home is damaged or destroyed, allowing you to get the most out of your coverage.
When your describing the items in your list, remember that the more information, the better. Here’s a quick reference list of the type of information you should include in your home inventory list:
- An in-depth description of the items. For example, rather than writing down “diamond ring,” be more descriptive, such as: “an emerald cut diamond ring, with white gold shank, accent stones and initials inscribed below the bridge.”
- Make, model, and/or serial number of the items.
- Date of purchase, receipts and photos.
- Estimated replacement cost if you bought it today. Do note that the value of the items might be different today than it was when you first bought them. This is especially true with jewelry, and other valuables.
- Appraisals at time of purchase. Especially if your items were appraised for insurance purposes.
Why Do I Need a Home Inventory?
Whether you’re a homeowner or a renter, everyone can benefit from a home inventory!
If you ever have to make a claim, a home inventory is a great asset to have, especially after stressful events like theft, storm damage or a fire (take a look at how one renter used their home inventory after facing an apartment fire).
When you make a claim, you typically submit information on everything that was lost — which can be difficult to do off the top of your head for all your possessions. Remembering to replace your TV or computer are no-brainers, but when it comes to remembering each piece of jewelry in your jewelry box, things tend to get overlooked. Having a personal property inventory will help, along with knowing how to properly insure your jewelry.
When you have your home inventory checklist, you know exactly what needs to be replaced, and you’ll have peace of mind knowing your entire household is protected.
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You’re admiring the rain from the comfort of your home when you notice a sound — the unmistakable drip of water dropping onto your floor. The first and hardest step is figuring out why your roof is leaking. And with these tips, you’ll find the culprit in no time!
Here’s Why Your Roof Is Leaking
The list of reasons why your roof is leaking may seem long, but don’t worry — when it comes to finding the leak and fixing it, the finding is the hardest part. And the good thing about these problems? They can all be fixed. Check out the list and see what’s troubling your roof:
Your roof is old
Roofs don’t last forever. Protecting your home and everything inside it from the elements comes with a cost. And with all that rain, snow, ice, wind and even sunlight wearing down your roof, it becomes more susceptible to leaks. Every roof will eventually need to be replaced, so learn more about how long your roof should last based on what it’s made of.
- How to Check Your Roof for Storm Damage
There’s no good time to find out your roof needs repair — but you may be able to mitigate that pain by routinely checking your roof for damage after severe weather. Waiting for a leak or damage to present itself gives the problem time to grow and worsen.
And sometimes, you’ll be faced with expensive roof and interior damage repairs if you’re not diligent. By being proactive and checking your roof for damage after severe weather hits can help your roof — and your savings — stay healthy.
