Blanket vs scheduled personal property coverage

A homeowner or renters policy insures belongings in bulk. Furniture, clothing, electronics, kitchenware and nearly everything else in the house sit under one personal property limit, and nobody lists them in advance. That arrangement, often called blanket or unscheduled coverage, works well for ordinary possessions and poorly for a few particular kinds of things.

Scheduling is the alternative for those things. An item is listed individually, with a description and a value, on an endorsement or a separate floater. It then carries its own limit and, usually, far broader coverage. The choice is not between the two for a whole household. It is which handful of items deserves to be pulled out of the blanket and listed.

How blanket coverage works

Personal property coverage, Coverage C on a homeowner policy, pays for loss to belongings anywhere in the world up to a single limit, subject to the policy deductible. On an HO-3 it covers named perils such as fire, windstorm, theft, smoke, vandalism and sudden water discharge. On an HO-5, or with an open-peril contents endorsement, it covers any cause not excluded. Settlement is at actual cash value unless the policy includes replacement cost on contents, which most buyers should add.

The blanket limit carries special limits of liability for categories that are small, valuable and easily stolen or lost. Typical categories are jewellery, watches and furs, which often have a low cap for theft; firearms; silverware and goldware; cash, coins and precious metals; securities and stamps; collectibles such as trading cards; and business property kept at home. Those caps apply regardless of how high the overall personal property limit is, and a blanket policy with a large limit can still pay very little for a stolen ring.

How scheduled coverage works

A scheduled personal property endorsement or personal articles floater lists each item, or each collection, with a stated amount of insurance. Carriers usually ask for a recent appraisal, receipt or bill of sale for items above a certain value, and they may ask for a new appraisal every few years. Premium is charged by category, such as jewellery, fine art, cameras, musical instruments, firearms, silverware or sports equipment, and by territory.

Coverage on a scheduled item is typically open peril, which means it includes accidental loss and mysterious disappearance: the stone that falls out of its setting, the watch left in a hotel room, the camera dropped into a river. Many forms have no deductible. At a loss, the carrier generally pays the lesser of the scheduled amount and the cost to replace the item with one of like kind and quality, and it may replace a piece of jewellery through its own jeweller rather than pay cash. Some floaters cover certain categories such as fine art on an agreed value basis instead.

The mechanism that actually differs

Three things change when an item moves from blanket to scheduled coverage. The limit changes from a shared category cap to a figure set for that item. The covered perils widen from a list, or from open peril with broad exclusions, to open peril with accidental loss and disappearance included. And the deductible usually falls away. The trade is that each item must be valued, documented and paid for individually, and that settlement is capped at the listed amount, so an item that appreciates without a new appraisal becomes underinsured.

Between the two sits a blanket floater: one limit for a class of items with a per-item maximum and no individual listing. For example, a jewellery floater might insure a whole collection up to a total figure with no single piece above a set value. It suits a collection of many moderately priced items where appraising each one would cost more than it is worth.

A worked lost-ring claim

Suppose a couple in Scottsdale carry a homeowner policy with $200,000 of personal property coverage, a $1,500 special limit for theft of jewellery and a $1,000 deductible. Their engagement ring is appraised at $12,000. On a houseboat trip, the ring slips off a finger into the lake. Loss of property without theft, fire or another named peril is not covered under the HO-3 personal property section, so the blanket coverage pays nothing. Had the ring been stolen from their hotel room instead, the policy would have paid the $1,500 theft limit less the $1,000 deductible, or $500.

Now suppose they had scheduled the ring at $12,000 for, say, $180 a year. The floater covers mysterious disappearance with no deductible, and the carrier either pays up to $12,000 or has a jeweller replace the ring with one of like kind and quality. For example, if their camera equipment worth $6,000 had been destroyed in a house fire, the blanket coverage with a replacement cost endorsement would have paid for it in full less the deductible, and scheduling it would have added little. The figures are illustrative.

What is worth scheduling

The decision comes down to whether the blanket coverage would respond at all, and whether its caps would pay enough when it did.

• Jewellery and watches worth more than the policy's theft sublimit, especially items worn every day and exposed to loss, not just burglary.
• Firearms, silver and collectibles above their category caps, and art or antiques whose value an adjuster could dispute without an appraisal.
• Musical instruments, cameras and sports equipment taken off the premises regularly, where accidental damage is the likelier loss than fire or theft.
• Items used partly for business, since blanket coverage often limits business property sharply and excludes it off premises.
• Ordinary furniture, clothing, household electronics and appliances stay on the blanket limit; scheduling them would add cost without adding meaningful protection, as long as the policy settles contents at replacement cost.

Regional notes

Several possessions common across the region sit awkwardly on blanket coverage. Western and Native American jewellery and art, collected widely in Arizona and southern Utah, can carry values an adjuster cannot confirm without an appraisal. Hunting rifles and shotguns in Idaho and Utah households regularly exceed firearm theft caps. Ski, mountain bike and golf equipment in Park City, Sun Valley, Scottsdale and St. George leaves the house constantly and is more likely to be damaged or lost than stolen from home. And in wildfire country, where a total loss is a real possibility, a scheduled item is simply paid, while blanket contents claims rely on an inventory the household may never have made.

When to keep what you have

A household with replacement cost on contents, no individual item or collection above the policy's special limits, and a current home inventory is well served by blanket coverage alone. A household that already schedules its valuables at appraisals from the last few years is also well placed, and the only task is to add new pieces and update values as metal and stone prices move. The situations to change are a valuable ring or watch insured only under a theft sublimit, a schedule based on an appraisal from decades ago, and items that have been sold or given away but are still listed and billed. We review the special limits on your policy, price scheduling for the items that justify it with the carriers we represent in Arizona, Nevada, Utah and Idaho, and tell you when the blanket coverage is already enough.