Hey Ducks and Bucks, I'm a claims adjuster for an insurance company, and homeowners' insurance is what I do (I know, my forum title says "knifemaker", but I'm talking about by day here).
Anyhow, you've got pretty much the right answer above. However, there are a couple more things to keep in mind.
First. If, God forbid, something happens to your home and your knives are damaged or destroyed, you should make sure you at the very least have an inventory of them. My company doesn't tend to be very hard-nosed about this sort of thing, but we could be. It's well within the terms of the policy.
Your policy says:
2.Your Duties After Loss. In case of a loss to covered property, you must see that the following are done:
a.Give prompt notice to us or our agent;
b.Notify the police in case of loss by theft;
d.Protect the property from further damage.
e.Make reasonable and necessary repairs to protect the property ; and
f.keep and accurate record or repair expenses;
g.Prepare an inventory of damaged personal property showing the quantity, description, actual cash value and amount of loss. Attach all bills, receipts and related documents that justify the figures in the inventory;
If you fail to do any of those things, you've legally got no coverage. You have to hold up your end of the deal, or the insurance co. doens't have to hold up theirs (again, my company is not very tough on these things... other companies are).
So that's one thing. If it ever comes about that you've got to file a claim, make sure you do it right so you don't wind up out of luck. Having an inventory ahead of time could save you a whole lot of hassle.
Another thing to watch out for is this: by default, your homeowner's policy covers you for
actual cash value settlement of losses to personal property. What does that mean?
There are two ways to settle a loss. You can pay somebody for the
Actual Cash Value of what they lost, or for the
Replacement Cost of what they lost. The Replacement Cost (I'm capitalizing on purpose here, to make it clear that these are terms from your insurance contract) is the dollar amount it would take to go buy the item on the open market. If you had a 5-year old 19" Toshiba TV, and it got destroyed, and your policy provided Replacement Cost coverage, you and your adjuster would look up the price for 19" Toshiba TVs, and you'd get that amount of money.
Now, if your policy only has Actual Cash Value coverage (and remember, by default, that's what your homeowner's policy provides. RC coverage is an add-on.)... your policy pays you for
what the old item was worth. How do you figure out what the old one as worth? Well, the ISO- Insurance Services Office- puts out a great big chart of the lifespans of EVERYTHING. People, backhoes, drywall, toasters, everything. We'll use the TV example again. If ISO says 19" TVs are good for 15 years, and yours is 5 years old, then it's 33% "used up". It's gone through 1/3 of its average lifespan. It has 2/3 of its lifespan left, therefore its still got 2/3 of its value.
So if your 19" TV cost $100 new, Replacement Cost coverage pays you $100, and Actual Cash Value coverage pays you $66.66.
See why this makes a difference?
And again, remember that Actual Cash Value coverage is the default, and Replacement Cost coverage is an add-on, it costs more.
So there's two things to note, and here's one more. Your homeowners' policy covers the building- and everything permanently attached such as cabinets and carpets- for
everything except what's excluded.
It covers your personal property, and this includes knives, for
nothing except what's named.
Want to know what's named? Here's the list:
COVERAGE C PERSONAL PROPERTY
We insure for direct physical loss to the property described in Coverage C caused by a peril listed below unless the loss is excluded in SECTION I EXCLUSIONS.
1.Fire or lightning.
2.Windstorm or hail.
This peril does not include loss to the property contained in a building caused by rain, snow, sleet, sand or dust unless the direct force of wind or hail damages the building causing an opening in a roof or wall and the rain, snow, sleet, sand or dust enters through this opening.
3.Explosion. {If you're curious, yes, this includes bullets.}
4.Riot or civil commotion.
5.Aircraft, including self-propelled missiles and spacecraft.
6.Vehicles.
7.Smoke
8.Vandalism or malicious mischief.
9.Theft
10.Falling objects. Damage to the falling object itself is not included.
11. Weight of ice, snow or sleet which causes damage to property contained in a building.
12.Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning or automatic fire protective sprinkler system or from within a household appliance.
13.Sudden and accidental tearing apart, cracking, burning or bulging of a steam or hot water heating system, an air conditioning or automatic fire protective sprinkler system, or an appliance for heating water.
14.Freezing of a plumbing, heating, air conditioning or automatic fire protective sprinkler system or of a household appliance.
15.Sudden and accidental damage from artificially generated electrical current.
16.Volcanic eruption other than loss caused by earthquake, land shock waves or tremors.
Those 16 perils are the ONLY things that can happen to your knives for which you would have coverage. Now it seems pretty thorough, and it's true, it covers a lot. But there are plenty of things that aren't covered, so keep your eyes open, and don't fall into the trap of thinking that anything that could possibly happen to the collection would be covered by insurance. It's a lot more specifically laid out than that!
Whew, that's the most I've written on BFC on any one topic, probably ever. But I hope it helps, because I'm sure there are plenty of members here who ar ein the same boat. And who reads their insurance policy anyway?
Mike
