Man proposing to girlfriend with engagement ring

Engagement Ring Insurance

One of the things we're often asked is whether engagement rings are generally covered by a wedding insurance policy.

Whilst wedding rings are generally covered for loss by wedding policies (albeit usually only for a short period of time before and after the big day), no such cover is available for your engagement ring.

Home Insurance

It's quite possible that your existing home contents insurance policy will cover your new ring. Many policies offer cover for jewellery as standard but you'll want to check the small print or phone your insurer to make sure you're properly protected.

Many insurers will only provide cover on a single item up to a certain limit - if you want to increase that cover you may need to pay an additional premium. You may need to specifically list the ring on your policy if it's particularly expensive.

For a further premium, most home contents policies will also cover your ring for loss or theft away from the home too.

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Engagement Ring Insurance

If the cover provided by a home contents policy isn't right for you, you may want to think about insuring your ring separately with a specialist engagement ring insurance or jewellery policy. A number of specialist insurers can be found by simply searching Google.

You may also find that you're offered insurance by the retailer when you purchase your engagement ring. It's worth checking how much this costs and what exactly it covers you for - sometimes it can be competitively priced.

Engagement ring in a box

Valuation and Photos

Whichever way you decide to insure your engagement ring, you should regularly get it professionally valued by a jeweller or expert who can provide you with a certificate of that valuation - some insurers even insist on it. Depending on the quality of the stone, it may be worth quite a bit more than the retail price. Make sure the valuation matches the sum that you have the ring insured for.

You should also take photos of your ring and keep them in a safe place along with your valuation certificate and original receipt.

Should the worst happen and you need to make a claim on your insurance policy, both will help your insurer to process the claim more quickly.

How Much Should You Spend on an Engagement Ring?

It was not until after the war in 1947 that any particular price expectation was defined - DeBeers tried to boost diamond sales with the slogan 'diamonds are forever' and by suggesting that the equivalent of one month's income should be spent on the engagement ring. This multiple later increased to two months' income - in fact there are now many sources which suggest an expectation of up to three times the monthly income!

Of course, in today's economic climate, this is simply not possible for many people. Remember also that buying the engagement ring is probably the first cost of many wedding related expenses, as most couples foot the wedding bill themselves these days. Ultimately, the amount you spend is up to you, and has to be decided on your own personal circumstances.

The symbol of love, devotion and commitment is the most important thing - it matters much less whether you save up 3 month's income for a glittering rock, or you don't spend a penny and use a family heirloom (like Prince William!).

Jewellery shop - somewhere you might buy an engagement ring

Where to Spend?

The best places to find good value jewellery is in the large city jewellery specialists, such as the Birmingham Jewellery quarter or London's Hatton Gardens. By all means, buy from reputable online dealers but do bear in mind that some diamonds are bought from countries whose governments invest the profits in a less than ethical manner, so consider carefully the sourcing of your diamond.

Don't give in to pressurised sales pitches and special offers - decide on a budget first and stick to it. Avoid impulse purchases, instead compare prices and don't be afraid to haggle.

But if I spend more, I will be making a good investment for the future?

The original base value of any ring is marked up - often at least 100% plus VAT - to cover the shop's décor, staff, heating, insurance, rent and so on. In addition to this, your investment has annual ownership costs such as insurance as well as annual maintenance required under the guarantee terms and conditions.

This means that even a high quality engagement ring may take decades to be considered as even a reasonable investment in true financial terms. The theory that a diamond ring is an investment seems to stem from the wartime era, as a last resort, the engagement ring could be pawned (for much less than it was worth).

Save or Borrow?

If you know you are going to propose, then start saving now! Work out how much you can afford to put by each month, look at how long you have and hey presto, there is your budget. Historically, saving for the ring proved to the bride-to-be's family that their potential son in law could save for their future home.

For those with good financial control and a good credit rating, when you have saved enough make your purchase using a credit card that offers cash back (and pay off the balance in full before any interest is accrued). Another benefit of buying using a credit card is that you automatically get consumer protection in case the company you are buying your ring from goes bust.

If you take out credit to buy your engagement ring without saving first, make sure you can afford the repayments, that you choose a card with a low APR and that you pay it back as fast as possible. An engagement ring should not saddle you with a lifetime of debt!

But I still don't know how much to spend?

It is true, no one wants to be seen as skimping on an engagement ring. The industry knows this, and plays up to it when encouraging people to spend more than their budget. Don't get sucked in by the marketing hype - expensive does not necessarily mean that it is more beautiful. Which do you think your bride-to-be will be more interested in - a sparkling diamond that costs more than you can afford, or your romantic proposal to spend the rest of your lives together?

While a month's salary is a useful rule of thumb, it is more important to stick within a budget that you can afford. The Beatles were quite right - "I don't care too much for money... because money can't buy me love"!

Diamonds are forever - how to know if you are getting good value

The most popular engagement ring is a diamond solitaire. If you plan to buy one, make sure you understand the basics of diamond ratings so you get the most value from your hard earned cash.

Choose carefully

Of course, if you are buying the ring before the proposal, you need to be fairly confident of your bride-to-be's personal tastes and ring size. Make sure you check with the shop that an exchange is possible, the time-scale you must do this in, and that there is a fairly wide range of alternative styles to choose from within your budget. much depth as you are able to ensure you get the best value, regardless of budget.

A brief history

Although betrothal gifts date back as far as Roman times, it was not until the 20th century that the diamond engagement ring became commonplace. Indeed, before the end of the 19th century, the bride-to-be sometimes received a sewing thimble as a promise of marriage!

References:

Guardian
Wikipedia
ThisIsMoney.co.uk
WeddingChaos

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