1. Homeowner Insurance Policy: Allows you to add value to expensive household items like jewelry. This will help against theft and home-related damages (i.e. fire) but will not cover damage from household chores or incidents outside the home.
2. Valued At Insurance Policy: Perhaps the most rare and the most difficult policy to fund. You set your ring's value, including all costs, and the policy will pay the amount you set if something happens to the ring, even if what you're asking for is more than the current value of the item.
3. Replacement Insurance Policy: Helps in refunding the replacement of the ring within the agreement terms. You can replace the engagement ring with a similar new one with identical diamond size, etc. at the current market value. So if your ring is currently more expensive than when you first purchased it, the replacement policy will pay the cost increase instead. However, if your ring is less valuable now than when you purchased it, this will not be the case.
4. Actual Value Insurance Policy: Replaces cash value of the engagement ring, subtracting the ring's depreciation. For example, if the ring is six years old but costs $1000, the cost of those six years will be subtracted from the ring's value due to the ring's daily wear and use. This is the least expensive option of the four choices.
