Should My Watch Be Insured? Exploring the Importance of Watch Insurance

If you’ve recently purchased a high-value timepiece, you might be wondering if it’s necessary to insure it. Watch insurance is a topic that requires careful consideration, and while there are no hard and fast rules, there are several factors to keep in mind. This article aims to provide guidance on whether you should insure your watch and the types of insurance coverage available.

Assessing the Financial Impact

A crucial question to ask yourself is whether the potential loss of your timepiece or watch collection would significantly affect your financial situation. Paul Boutros, head of watches, Americas, at Phillips auction house, advises considering the personal financial impact. If the loss would be significant, then insurance is highly recommended.

Gathering Essential Documents

Even if you are undecided about insurance, it’s essential to gather all the necessary documents. If you purchase a watch from a retail store, ensure you keep the receipts, paperwork, and packaging. For auction purchases, request a condition report to verify the watch’s condition at the time of purchase. Sabine Kegel, Christie’s head of watches, Europe, emphasizes the importance of condition reports, as they help confirm the watch’s condition and provide valuable information for insurance purposes.

Coverage Options

For watches valued under $2,000, Loretta Worters, vice president of media relations at the Insurance Information Institute, suggests including them in a general homeowner’s or renter’s policy. These policies typically offer limited coverage for fire, windstorm, theft, and vandalism, with deductibles ranging from $500 to $1,000. However, coverage while traveling may not be included, so it’s crucial to review the policy.

For watches exceeding $2,000 in value or multiple timepieces, consider a personal articles floater. This coverage option offers broader protection for valuable watches and does not require a deductible. Worters recommends obtaining a professional appraisal before purchasing a floater. A free appraisal can be obtained from the store where the watch was purchased, or you can hire an independent appraiser at a cost of $50 to $150.

Insurance Companies and Specialized Policies

Insurance companies offer their own versions of floaters. Chubb, for example, provides Valuable Articles Coverage, which costs between $150 and $400 per year for a $10,000 watch. This policy offers worldwide, all-risk protection with no deductible and covers mysterious disappearance and accidental damage.

Chubb recently partnered with the watch platform Hodinkee to offer online insurance with immediate cost estimates and activation. Appraisals are only required for watches valued at $100,000 or more. Specialty insurers also offer comprehensive coverage, including protection against flood, earthquake damage, and coverage during global travel. The cost of such insurance typically ranges from 1% to 2% of the watch’s retail value, with some insurers focusing on luxury watches worth $1 million or more.

Benefits of Specialized Insurance

Specialized insurance policies provide several advantages for high-value timepieces. These policies offer coverage that is specifically tailored to the unique needs of luxury watches and provide adjustments for a watch’s changing value over time. Additionally, specialized insurers have a network of experienced specialists who can assess and repair intricate watch models.

Companies like Malca-Amit, which offer high-net-worth insurance and other services, not only provide secure storage for valuables but also offer secure logistics solutions. This includes bringing your safety deposit box to you for special occasions. Specialized insurance is crucial in situations where standard household insurance may not provide sufficient coverage for intricate and high-value watch models.

Conclusion

When considering watch insurance, evaluate the potential financial impact of losing your timepiece or collection. Gathering essential documents and considering coverage options are essential steps. While general homeowner’s or renter’s policies may be suitable for lower-value watches, personal articles floaters and specialized insurance policies offer more comprehensive protection for high-value timepieces. Specialized insurance providers have the expertise and network to handle the unique requirements of luxury watches. By securing the appropriate insurance coverage, you can enjoy peace of mind knowing that your valuable timepieces are protected.