Floaters also provide some automatic coverage for newly acquired items, as long as they are declared and an additional premium paid within the period allowed.

An unendorsed homeowners policy provides coverage for the average risk on a named-perils basis. Floaters are typically written on an open-perils basis, so losses to the scheduled property are covered unless specifically excluded.

For example, a ring falling off into a lake during a boating excursion would be covered if properly scheduled on the floater. There is no named-perils in the homeowners policy to provide that coverage.

Since flood and earthquake are covered perils–unless excluded by endorsement–mitigating losses for valuable items is especially important should a client live in a region where hurricanes, earthquakes or wildfires are more of a regular occurrence.

Insureds can register with a variety of companies that will provide consultation before such an event happens or assist in protecting schedules if they are threatened by a disaster.

Floaters also can be written on an agreed value–set by appraisal or bill of sale–that prevents any dispute on the payment in the event of a covered loss.

Floaters are especially important for hard-to-value items, such as sports memorabilia or vintage wines, as well as for jewelry, which can be replaced with property substantially identical, but for less than the stated value. There also are insurance companies that don't require the item be replaced at all.

Floaters can be written in conjunction with homeowners policies or on a stand-alone basis with both admitted and nonadmitted A.M. Best “A”-rated or better carriers. Whether scheduled or on a blanket basis, most floaters provide coverage anywhere in the world, which is an important feature for those who travel.

Floaters can be written with zero deductible, or insureds can receive credits for higher deductibles. Credits also are available for safety devices, such as monitored alarms, home safes or items kept in a bank vault.

It doesn't matter where a client lives or how much they are worth. When it comes to insuring intrinsically valuable items, such as original manuscripts, rare books, musical instruments, jewelry, furs and fine art, every item should be protected with a properly written personal article floater.

Donna Dodd, CIC, AU, director of personal lines for Burns & Wilcox in Farmington Hills, Mich., can be contacted at [email protected].