Public liability insurance solutions for jewellery stores: customer goods left for repair
When a customer leaves a ring, watch or necklace with you for repair, the item may stay in your store while it is assessed, repaired or waiting to be collected.
If it is lost, stolen or damaged during that time, it is important not to assume public liability insurance will automatically respond.
Public liability insurance for jewellers and Jewellers insurance can address different risks. Understanding where each may fit can help you check how customer goods are treated within your insurance arrangements.
Does public liability cover customer jewellery left for repair?
Not necessarily.
Australian Government guidance explains that “Public liability insurance covers you if someone dies, gets injured or has their property damaged because of your negligence.”
For a jewellery store, this may be relevant if a customer is injured at your premises or your business causes damage to someone else's property.
However, a ring, watch or other item that a customer has handed to you for repair can raise a different issue.
Why care, custody or control matters
This can matter when a customer hands over jewellery and your business takes possession of it.
It means customer jewellery awaiting repair should not simply be treated in the same way as other third-party property when considering public liability cover.
How Jewellers Block insurance can apply to customer repair goods
Jewellers Block insurance is designed around property risks that jewellery businesses can face.
The policy definition of stock and merchandise includes property “entrusted to you on sale or return or on approbation or for work to be done thereon”.
This makes the wording relevant when a customer leaves jewellery with you for repair or alteration.
It does not mean every loss or damage event will be covered. The applicable Schedule, policy limits, conditions, exclusions and extensions still need to be checked.
You can also read more about insurance for jewellers arranged by Marsh.
How customer goods are treated while held for repair
Jewellers Block insurance contains provisions relating to customer goods and property being worked on.
Marsh also identifies entrustments and damage to goods being worked upon as areas that can form part of jeweller insurance.
The key point is to understand how your own policy treats the item at each stage, from accepting it from the customer through to repair and collection.
What happens if customer jewellery is stolen?
How customer jewellery is stored can matter if a theft occurs.
These conditions relate to jewellery and valuables kept in showcases, cupboards, and counters. It also includes requirements around alarms and other protection equipment.
These conditions can vary depending on the circumstances and the applicable Schedule.
Storage and security conditions to check
It is worth checking not only whether customer goods fall within the policy, but also what you are expected to do while those goods are in your store.
This may include understanding when jewellery needs to be secured, what protection equipment needs to be operating and what limits apply.
What happens if jewellery is damaged during repair?
It may be treated differently from jewellery that is simply waiting for repair.
An exclusion relating to damage sustained while insured property is being worked upon and directly resulting from that work. It also includes damage to goods being worked upon, as an extension within its optional variations or extensions.
Whether an extension applies depends on what is shown in the applicable Schedule.
Why repair work can be treated differently
This distinction is important for jewellery businesses that resize rings, repair watches or carry out other work on customer property.
Do not assume that cover for an item while it is being stored means the same cover applies while repair work is underway.
When repair work becomes a consumer law issue
Insurance is only one part of the picture when you provide jewellery repair services.
The ACCC says service providers must use an “acceptable level of care and skill” and “take reasonable steps to avoid causing loss or damage" when providing a service.
These consumer guarantees can be relevant when you repair, resize or provide another service involving a customer's jewellery.
Insurance does not remove your responsibilities under Australian Consumer Law.
Is jewellery left for repair the same as safekeeping?
Not necessarily.
The Jewellers Block distinguishes property entrusted for work from items entrusted solely for safekeeping.
This matters because the wording excludes certain customer goods that have been entrusted solely for safe custody.
If your store accepts jewellery for repair, alteration and safekeeping, check how your policy treats each situation.
What should jewellers check in their insurance?
A few practical questions can help when reviewing customer goods:
- How does the policy treat jewellery entrusted to you for repair?
- What limits, exclusions and security conditions apply?
- Is a relevant worked-upon extension included in your Schedule?
- What information may be required if an incident leads to a claim?
The answers will depend on your policy and the circumstances.
How public liability and Jewellers Block address different risks
The same customer visit can involve different risks.
A customer injury may raise a public liability issue. A ring held for repair may need to be considered under Jewellers Block insurance. Damage caused while the ring is being worked on may depend on specific exclusions or extensions.
Understanding those differences can help you ask clearer questions about your cover before something goes wrong.
