Rising gold price puts your jewellery at risk

gold jewelleryby: Shakil Adil/AP/Press Association Images

The rising price of gold, the ease of disposing of it, and the recession have apparently caused a massive spike in jewellery thefts from people's homes. The value of bling taken from homes has risen an astonishing 26.7% in the last three years. Jewellery now accounts for over a third of the value of theft from home claims.

So what does this mean for you?

Increasing thefts

Three things have combined to push up jewellery thefts. The first is the rising price of gold. The price of gold climbed to a peak value of £1127 per troy ounce in September 2011, compared with £595 back in January 2009. It starts to make the risk/reward balance of a burglary look decidedly different.

Second, the rise of cash-for gold services means it's easier for thieves to turn their swag into cash. Presumably the ability to stick it in an envelope and get cash with no questions asked is a much more attractive prospect than facing the scrutiny of a pawnbroker, or being forced to try to sell it on.

And third, the fact so many people are struggling to make ends meet means that there are many more individuals considering drastic and illegal solutions to their problems.

Martin Scott, head of Churchill Home Insurance, explained: "We're currently seeing an increase in both the overall number of jewellery claims and the number of jewellery items stolen within each claim, as the value of gold increases. At the same time we've been witnessing a decline in theft claims for electrical goods as these goods decrease in value and thieves target higher-value items instead."

What it means for you

For homeowners there are two key messages we need to take away from this. The first is that we need to protect our jewellery. This means thinking carefully about how we keep it, and whether we really want to make life easier for burglars by keeping jewellery in a box on the dressing table.

If there are valuable pieces it is worth hiding them around the home, such as in a pasta jar or a tin designed to look like a tin of beans. In some instances it is worth considering buying a safe for expensive items.

The second step is to make sure you keep your insurance up-to-date to reflect the increasing value of jewellery. Jewellery items that were previously worth less than the maximum for single valuable items under their home contents insurance policy may now be worth more, but the owner would usually only be covered for the limit stated on their policy. Many householders could find themselves underinsured if they have not informed their insurer of any increase in value.

Scott says: "We estimate that 35 - 40 per cent of householders are underinsured on their jewellery items. We urge homeowners to check the current value of their jewellery on a regular basis, and to update their home contents insurance cover accordingly if the value of their gold has increased. Ensure any pieces that are worth more than the insurer's single valuable item limits are listed on the home insurance policy as an additional item. Policyholders should remember to keep receipts or any other proof of purchase on file in case they have to make a claim in the future."

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