Stolen valuables: Determining the amount owed to the insured

Coverage Q&A: The insured has thousands of dollars worth of silverware stolen.

The insured is arguing that her insurer should pay the full policy limit for stolen silverware. (Photo: iStock)

Every claim is different, and some insurance policies can be difficult to interpret for unique situations. FC&S Expert Coverage Interpretation, the recognized authority on insurance coverage interpretation and analysis for the P&C industry, makes it simple to find credible answers to your complicated coverage questions. Analysis brought to you by our FC&S experts. 

Editor’s Note: When the value of the property is different from what is listed on the policy schedule, and multiple loss settlement provisions may be in play, determining the amount owed to the insured can become very confusing. That is the case with this week’s coverage question.

Question: One of our policyholders recently submitted a claim for stolen silverware. The homeowner purchased an HO3 10 00 policy with the H0 04 90 10 00 and has scheduled several silverware pieces on the HO 04 61 10 00. The total amount of coverage for the class labeled “silverware” on the H0 04 61 is $11,000.

The last page of the HO 04 61 states that there are “Assorted Buceletti Empire Pieces as on file at the Company.” In the insured’s policy file, we have each piece of silver listed with an assigned dollar amount for that piece. The list we have on file came from the insured via her agent. The claim is for eight of the five-piece place settings of silverware and a couple of serving pieces. The insured value listed on the H0 04 61 for the stolen silverware is $6,000.

To replace the stolen items it would cost $12,000. We processed our payment for $6,000. The insured is arguing that we should have paid her the full $11,000 coverage limit for her stolen silver. The insured is arguing that since the HO 04 61 doesn’t specifically refer to a list or schedule for the silver items like it does for jewelry and furs and some of the other classes of scheduled items, that she should have the benefit of the full amount of coverage for the silver. We believe coverage should be limited to the amount of coverage listed per stolen item. We think the HO 04 90 makes it clear that we are paying for each item’s replacement cost and the HO 04 61′s loss settlement provision makes it clear that we won’t pay more than the amount of insurance. The question is whether the amount of insurance listed for silverware blanket coverage or does it limit coverage per item?

We look forward to your interpretation of the HO 04 61 form concerning scheduled personal property classes that do not reference a list or schedule.

— FC&S Subscriber

Analysis: Many people have valuable property that they schedule onto their homeowners or renters insurance policies because the property is valuable and subject to particular types of losses. Jewelry, furs, stamps, coins, and other valuables are often scheduled. The policy may also have an endorsement providing replacement cost on contents, which adds yet another set of loss settlement parameters to the scheduled property endorsement.

Answer: To learn the answer to this week’s coverage Q&A, please log into your FC&S Expert Coverage Interpretation account.

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