Jewelry insurance claim ?

[lil mermaid]

Back in May of this year, I lost my enagement ring. I looked for it and looked for it, but it never turned up. I didn't even tell my insurance company about it for a whole month because I hoped that it would show up.

Well, I finally received my payout for it last week. (Not because of the insurance company dragging their feet - it was me. I was hoping it would show up!) The payout that I received was less than it would cost me to replace the diamond, but luckily my Mom is good friends with a diamond wholesaler in New York. He felt bad and as a favor to my Mom, sold me the stone at his cost.

The new diamond is the same size as my old one, same ideal cut, one clarity grade down but two color grades up. The price of a stone with the same specs on Blue Nile was $3000 more than what we paid for it, and in checking with other jewelers, more like $4000-5000 more. (Full retail, without any discounts.) I also bought a new mounting for l ess than half of what the full retail would be for it. We ended up paying about $700 more than the insurance payout.

So here is the question - what if my original ring shows up? I asked the insurance guy several months ago what would happen if it turned up after my claim was settled. He said that I either had to send the ring to them or send them a check. They didn't make me sign anything and also I haven't seen any paperwork from them stating this so I am wondering if they really expect that. I mean, I paid premiums for years and in good faith filed a claim. I got what I paid for. But on the other hand, say the ring turns up in 10 years or something. Then, if I keep it, I guess I would have made money on the loss??

So I guess these are the choices : Send them a check for several thousand dollars, send them a ring that is worth way more than the amount they paid me, send them my original engagement ring (worth more than what they paid me), which is worth quite a bit more than they paid me and also has more emotional value than the new ring.

What would you do? Insurance people, what do you think?
BTW this is totally hypothetical because I think my original ring is gone for good :-(

 

[CharlesTD]

Back in May of this year, I lost my enagement ring. I looked for it and looked for it, but it never turned up. I didn't even tell my insurance company about it for a whole month because I hoped that it would show up.

Well, I finally received my payout for it last week. (Not because of the insurance company dragging their feet - it was me. I was hoping it would show up!) The payout that I received was less than it would cost me to replace the diamond, but luckily my Mom is good friends with a diamond wholesaler in New York. He felt bad and as a favor to my Mom, sold me the stone at his cost.

The new diamond is the same size as my old one, same ideal cut, one clarity grade down but two color grades up. The price of a stone with the same specs on Blue Nile was $3000 more than what we paid for it, and in checking with other jewelers, more like $4000-5000 more. (Full retail, without any discounts.) I also bought a new mounting for l ess than half of what the full retail would be for it. We ended up paying about $700 more than the insurance payout.

So here is the question - what if my original ring shows up? I asked the insurance guy several months ago what would happen if it turned up after my claim was settled. He said that I either had to send the ring to them or send them a check. They didn't make me sign anything and also I haven't seen any paperwork from them stating this so I am wondering if they really expect that. I mean, I paid premiums for years and in good faith filed a claim. I got what I paid for. But on the other hand, say the ring turns up in 10 years or something. Then, if I keep it, I guess I would have made money on the loss??

Send them a check for several thousand dollars, send them a ring that is worth way more than the amount they paid me, send them my original engagement ring, which is worth quite a bit more than they paid me and also has more emotional value than the new ring.

What would you do? Insurance people, what do you think?
BTW this is totally hypothetical because I think my original ring is gone for good :-(

I work for an insurance company and yes if they pay you out and then the lost items shows up returns then it needs to be sent to them. If it isn't sent to them you can be charged with insurance fraud for it. I had a similar situation after a break in at my home my Tag Heuer watch was stolen and it showed up in a pawn shop on another city my only saving grace is that I purchased it back so I paid to have it returned thus negating the issue of turning it over to the insurance company. If it had just been given back to me then I would have had to either pay then the money back or return the watch to them. Also don't think insurance companies forget about these little things because they never do trust me we had a lady go to court for re payment of a loss she recovered and it wasn't pretty.

 

[lil mermaid]

I work for an insurance company and yes if they pay you out and then the lost items shows up returns then it needs to be sent to them. If it isn't sent to them you can be charged with insurance fraud for it.

Hmm.. the interesting part of this is that I received three quotes for a replacement with the same specs of my lost ring. They ranged from $1200 more to about $4000 more than what the ins. company paid me (the reason behind that is a story in itself.) So, if I give them the original ring back, then they MAKE money on ME.

How can you be charged with insurance fraud if you filed a claim in good faith?

 

[Skatermom23]

The only safe way out out this is to return the amount of money they sent to you. If the other ring shows up, I would sell one of them and return the money to the insurance company.

 

[lil mermaid]

The only safe way out out this is to return the amount of money they sent to you. If the other ring shows up, I would sell one of them and return the money to the insurance company.

You are probably right!

I don't think this is going to be an issue though, because I do believe that the ring is gone for good. I just thought it was an interesting question, both from a moral and legal standpoint. I guess not too many other people think so, though..

 

[ahutton]

Technically, by accepting payment for your loss you have "sold" your lost item to the insurance company and they now own that item. You've used the money to purchase a new one, and you own that item. If you were to find or recover the lost item (not purchase it, but locate it) then it truly does belong to them.

Maybe it makes more sense if you change it from a lost/stolen ring to a stolen car? If you (or the police) found the car after the company paid you for it, would you feel entitled to have the stolen car and the car you purchased with the settlement?

The issue of your lost item having a higher value of what is paid is a different matter. Is the difference in what you received your deductible? Or did the company issue payment based on the "actual cash value" and is holding the difference between that amount and replacement cost pending documentation you've replaced the item? If so, then anything additional it cost to replace the item (other than your deductible - you are out that amount by contract) is due to you and you should inquire with the claim person about receiving those additional funds. Many companies do this, as most insurance policies only entitle someone to replacement cost if they actually replace the item, and often people take the cash and decide to do something else with it.

eta: While it was not fraud that you make a claim under the assumption you lost the item and it would not be recovered, it is considered fraud if you later locate the item and don't return it. At the point it was recovered you've now been paid on a claim for an item that is not lost/stolen. By keeping it, you commit an act of fraud. That's what they teach us in insurance school...

 

[CharlesTD]

Hmm.. the interesting part of this is that I received three quotes for a replacement with the same specs of my lost ring. They ranged from $1200 more to about $4000 more than what the ins. company paid me (the reason behind that is a story in itself.) So, if I give them the original ring back, then they MAKE money on ME.

How can you be charged with insurance fraud if you filed a claim in good faith?

The fraud will come from not returning the ring or the money regardless what the ring was paid out at or what you paid for it just like auto insurance depreciation I know it shouldn't be that way but that is how insurance companies make their money we have a liscence to steal really LOL. So if the ring does turn up you best be ready to fork over the cash paid to you or the original ring.