What to Do If a Watch is Returned After the Insurance Claim is Paid?

Watches and jewelry items are common targets of theft out of the home, from your desk at work or your car. If a watch is valuable, such as an antique or a Rolex, you may end up filing a claim with your insurance company for replacement or reimbursement. If your watch is found or recovered by the police and you have been paid for an insurance claim, you should report it to your insurance carrier as soon as possible.

Homeowner’s policies often cover theft or destruction of jewelry and other valuables under the contents language of the policy, or under additional endorsements covering rare or expensive pieces.

If a covered item is stolen or lost, you may file a claim with your carrier to be made whole for your loss. Stolen goods are sometimes recovered, though, and lost property can be found. If your insurance carrier has paid your claim for a lost or stolen watch that's subsequently recovered, you must report it to the insurance company. The carrier will generally give you two options: return the money or return the watch.

If the watch is returned damaged, the matter rests with the carrier's claims department, which will generally make its determination based on the extent of the damage and the anticipated cost of repairs. It may ask you to send them the watch and keep the claim payment, or it may ask that you repair the watch and return to them the amount by which the claim payment exceeds the cost of the repair. In some cases, the company's own policies may require that you return the claim payment and file a new claim for the cost of the repairs. If the watch has sentimental value, you should report that as well to the carrier.

Insurance companies dispose of goods returned to them in this manner by holding salvage auctions, or by consigning the goods to a professional auction house for sale to recover the claims payments.

While it may seem a viable option simply not to report the recovery of lost or stolen property after you've received a claim payment from the insurance carrier, note that if your carrier finds out about it, you can be prosecuted for insurance fraud, which is a federal offense that carries with it stiff penalties including fines and imprisonment.