diff --git a/Orange/widgets/settings.py b/Orange/widgets/settings.py
index 75545211016..6381e0a0e13 100644
--- a/Orange/widgets/settings.py
+++ b/Orange/widgets/settings.py
@@ -507,9 +507,9 @@ def update_defaults(self, widget):
         widget : OWWidget
         """
         self.defaults = self.provider.pack(widget)
-        for name, setting in self.known_settings.items():
+        for setting, data, _ in self.provider.traverse_settings(data=self.defaults):
             if setting.schema_only:
-                self.defaults.pop(name, None)
+                data.pop(setting.name, None)
         self.write_defaults()
 
     def fast_save(self, widget, name, value):
diff --git a/Orange/widgets/tests/test_settings_handler.py b/Orange/widgets/tests/test_settings_handler.py
index 7975fa38bb4..575c4740b54 100644
--- a/Orange/widgets/tests/test_settings_handler.py
+++ b/Orange/widgets/tests/test_settings_handler.py
@@ -233,17 +233,25 @@ def test_schema_only_settings(self):
         handler.fast_save(widget, 'schema_only_setting', 5)
         self.assertEqual(
             handler.known_settings['schema_only_setting'].default, None)
+        handler.fast_save(widget, 'component.schema_only_setting', 5)
+        self.assertEqual(
+            handler.known_settings['component.schema_only_setting'].default, "only")
 
         # update_defaults should not update defaults
         widget.schema_only_setting = 5
         handler.update_defaults(widget)
         self.assertEqual(
             handler.known_settings['schema_only_setting'].default, None)
+        widget.component.schema_only_setting = 5
+        self.assertEqual(
+            handler.known_settings['component.schema_only_setting'].default, "only")
 
         # pack_data should pack setting
         widget.schema_only_setting = 5
+        widget.component.schema_only_setting = 5
         data = handler.pack_data(widget)
         self.assertEqual(data['schema_only_setting'], 5)
+        self.assertEqual(data['component']['schema_only_setting'], 5)
 
     def test_read_defaults_migrates_settings(self):
         handler = SettingsHandler()
@@ -329,6 +337,7 @@ def override_default_settings(self, widget, defaults=None):
 
 class Component:
     int_setting = Setting(42)
+    schema_only_setting = Setting("only", schema_only=True)
 
 
 class SimpleWidget: