Editor's Note: This article has been provided by DanFarrell, a consultant for Enservio and the Consulting Producerfor the PBS' “Antiques Roadshow” TV series.

For most people, thinking about their insurance coverage beginsand ends with paying their monthly premium. Sure, they are happy tobe covered, but if you ask them if they'd receive enough to replacea specific item in the event of loss, then few would be able toreply with any sense of certainty.

This is most strikingly the case with insured jewelry. While most homeowners' policies do coversuch items, when an actual loss of an entire jewelry collectiondoes occur, it is a rare owner who receives a settlement anywherenear the true value of the missing items. What most people fail torealize, though, is that the key to avoiding being in thatposition, largely rests on firmly establishing what they actuallyown – and making sure their insurer knows too.

Taking Stock is Fundamental

One of the most important things to keep in mind when thinkingabout insured jewelry items—and the potential costs associatedwith their replacement, should a claim be filed—is whether or notevery single piece is covered by a property policy for its currentvalue. One need only watch something like AntiquesRoadshow to get a sense of how an individual owner'sperspective on the value of jewelry can be quite different fromthat of an actual expert in the field.

Not surprisingly, what we have here is a failure to communicate,understanding the common disparity between perceived and actualvalue. The key to ensuring that jewelry collections aresufficiently valued to guarantee replacement in the current marketis to document in detail, comprehensive information on the piecesowned.

This begins with the very basic—but frequently overlookedstep—of establishing a catalog of exactly what items are owned.Taking the time to inventory and record exactly what is atstake, and adding photographs for particularly valuable pieces, isthe single most important step owners can take toward having thepeace of mind that an insurance policy accurately reflects theircollections.

What is it Really Worth?

While knowing exactly what is owned is vital to securing propercoverage, in order to determine if a collection or aspecific item can receive enough replacement value from asettlement to replace the loss requires asking additionalquestions. Owners must therefore go beyond knowing merelywhat they have; they must make a real effort to determinethe actual value of these items.

This isn't as simple as one might think. Many jewelry appraisalsconducted at local shops—and the certificates of authenticityretained at the time of purchase—are little more than salestechniques that bear little relationship to the true value of aparticular item or jewelry collection. Owners must get into thespecific details of each piece to uncover the accurate value.

For example, would the seller of a particular piece be willingto buy it back at the appraised value they declare for it? Doesthat diamond ring really possess the color scale and absence ofdefects that correspond to its declared value? Is that piece ofdesigner gold really from the studio theseller claims?

When it comes to jewelry, the most important thing is to havethe person you're buying it from be someone you have spent sometime checking out as honest and reputable. There really is nosubstitute for doing the legwork when it comes to ensuring that apolicy is providing adequate coverage.

Jewelry owners can rest assured that insurers will appreciateand respect their efforts. All P&C companies like moreversus less information on the items to which they areextending coverage. Thus, up-to-date, reliable dataabout the covered items is a crucial step toward ensuring thatboth the policyholder (in this case, the jewelryowner) and insurer are on the same page, should replacementever need to take place.

Some would say the resulting sense of confidence ispriceless.

Dan Farrell is a consultant for Enservio of Needham, Mass., aprovider of software and services that help property insurancecarriers price policies and settle contents claims. He is alsoowner of Daniel Farrell LLC, an appraisal services and artconsultancy firm, and the Consulting Producer for the PBStelevision series, Antiques Roadshow. Farrell has degrees from theUniversity of Notre Dame (B.A.), the University of Chicago (M.B.A.)and the London School of Economics (M.Sc.).