Special Limits of Insurance explained

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Special Limits of Insurance – what’s that?

The Special Limits section of an insurance policy lists the limitations of the coverage for certain items.  All homeowners policies limit coverage for specific types of property such as fur, jewelry, bicycles, manuscripts, electronics and coin/stamp collections, etc.  These limits may apply to theft losses or they may be applied for any loss – yes, any loss!

Limitations and exclusions exist for a variety of reasons – one of which is to keep the cost of insurance down.  Not everyone has expensive jewelry or bicycles or collections and for those that do, it would be best to talk directly to that person to find out how much insurance will be required.  Again, this keeps the insurance premiums down.

REMEMBER: Insurers operate differently – so be sure to find out what is needed from your Founders Broker in order to add coverage for certain items – for example, will you need an appraisal?

Below is list for common limits found on homeowners property policies.  Your insurance policy wording may show different limits (for example, limit on wine and spirits!) – so refer to your policy documents for special limitations applicable.  If you have any questions, call your broker.

  • Jewellery, watches, gems, and furs – up to $3,000 for theft losses
  • Money, including cash cards or bullion – up to $500 for all insured losses
  • Utility trailers / Spare automobile parts – up to $1,000 for all insured losses
  • Watercraft, including their furnishings, equipment, accessories and motors – up to $2,500 for all insured losses
  • Securities – up to $2,500 for all insured losses
  • Coin or banknote collections / Stamp collections – up to $1,000 for theft losses
  • Books and tools for a business while on your premises – up to $2,500 for all insured losses
  • Bicycles (its equipment and accessories) – up to $1,000 for theft losses

Please refer to your policy wording for a complete listing of special limits. If you need protection beyond the special limits, talk to your broker about purchasing additional coverage for your contents.  These quotes are non-obligatory – your Broker is here to advise you, but not decide for you.  To make a good decision, you need to have all of the information, so talk to us today!

PLEASE NOTE: If property is stolen from your car, the loss to that property would be covered under your homeowners property policy.  If there is damage to your car this can be claimed under your auto insurance, but only if you have Physical Damage coverage (Collision / Comprehensive) on your policy.  Check your auto policy for details, or call us.   Your best option is to avoid a loss.  Don’t leave valuable property in your car; definitely not in the open.  You can avoid a loss and avoid the hassle.

Policy Clauses can also limit your Claim Settlement (Parts Clause or Pair & Set Clause)

Your policy has a “Pair and Set Clause” and “Parts Clause” stated within its wordings. This provision states that if one piece of a set (or a part) is lost or damaged, your Insurer will not reimburse you for the full value of the set. For example, the insurers position is that if one diamond earring of a pair is lost there is still value in the remaining earring and they cannot pay more than the portion that was lost. This directly relates to the definition of “indemnity” also found in the wordings of your documents. This definition states that an insured cannot financially benefit from a claim and the Insurer will only put you back into the same financial position you were immediately before the loss, no more and  no less. However, there are times determining indemnity can be difficult when the item being claimed is part of a set, an antique, an original work of art, etc.  So the best advice is to speak with your insurance broker regularly (at least once a year) to review your coverage and ensure the property that you need replaced after a loss is covered!

 

If you have any concerns about certain property you own not being covered, please discuss with your Founders Insurance Broker as soon as possible.

 

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