An insured's HO-3 policy has a $200,000 Coverage C limit. A burglary results in the theft of $4,000 in jewelry and $3,000 in silverware. Assuming no endorsements, how much does the insurer pay for these items?

Why this is the answer

Standard ISO homeowners policies impose special sub-limits within Coverage C for certain high-theft-risk categories. These apply per-occurrence for theft losses regardless of how large Coverage C is. The standard limits are: jewelry, watches, furs — $1,500 per theft occurrence; silverware, goldware, pewterware — $2,500 per theft occurrence; firearms and related equipment — $2,500 per theft occurrence; money and bank notes — $200; securities, deeds, letters of credit — $1,500. Here: $4,000 jewelry → capped at $1,500; $3,000 silverware → capped at $2,500. Total = $4,000. To cover full value, the insured needs a Scheduled Personal Property endorsement (SPP) listing each item at its agreed value.