Think your jewelry is insured? Not so fast…

If you expect to give or receive jewelry this holiday season, you may be surprised to learn your jewelry may not be automatically or fully insured under your homeowners insurance policy.

“Many people still have the false impression that their jewelry is fully covered by their homeowners policies,” said Mike Maley, vice president of Personal Lines Operations at Jewelers Mutual Insurance Company in Neenah, Wis. “What they don’t realize is that unless their loss is from fire, theft, or some other cause specifically mentioned in their policy, it may not be covered.”

Furthermore, coverage for theft of your jewelry generally is limited to $1,000. If the loss of jewelry occurs due to a burglary, this limit will not provide nearly enough coverage if a $5,000 ring is stolen, along with the rest of your jewelry.

Theft and fire aren't your only worries. According to Maley, more than half of all reported jewelry losses are partial losses, from the loss of a single stone to a chipped diamond. Many people are surprised to learn that everyday activities, like washing dishes in a ceramic sink or playing a physical sport, can cause these types of losses.

Stacey B., from Jonesborough, Tenn., chipped her diamond while playing with a feisty dog. “Ack! I was heartbroken,” she wrote in her blog. While partial losses like this one typically are not covered by a basic homeowners policy, Stacey was fully covered with her policy from Jewelers Mutual. The company’s specialized jewelry insurance policy provides some of the broadest protection available, including coverage for damage, loss, theft, and even mysterious disappearance.

“I never would have thought that any diamond could be prettier than the one I chipped, but this new one is awesome,” she said.

With affordable rates, the insurance is well worth the cost. “You would never drive your car without making certain it was fully insured,” Maley said. “Why take a similar risk with an expensive item that is so easily damaged or lost?”