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A general guide for using the Forum with some rules and tips
collection insurance?
  
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R Saunders




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PostPosted: Oct 24, 2018 04:08    Post subject: collection insurance?  

Hello, I would like input on insurance. I live in the U.S.A. but welcome people from around the world. As a home owner or renter not while in a business or on loan to a museum or library, although your insurance may cover items. At what point did you buy insurance? Some of mine were self collected, paid cash at a show or rock shop, no individual appraisals or receipts. I have been reading of a company that is inexpensive. They will cover about anything from a base ball card to a pocket knife or toy train collection.
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kushmeja




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PostPosted: Oct 24, 2018 08:53    Post subject: Re: collection insurance?  

I live in NJ, USA looked into getting separate insurance for my collection & retail stock a couple years back. Every company that I looked into required a full itemized appraisal value and/or sales receipts or other document showing proof of value. It wasn't really feasible from a cost and time standpoint for me to get everything professionally appraised, and like you, I don't have sales receipts for a good amount of my collection & stock.

I'm currently renting, so what I did instead was to get the maximum available policy for renter's insurance, which was much cheaper and didn't require an upfront appraisal and ongoing meticulous itemized record keeping. I was able to get a renter's insurance policy for $250k coverage through Esurance, which only costs me about $32/month when added in with my auto policy. The $250K total coverage was sufficient to cover pretty much everything we own and worked for me because we don't have a ton of expensive home furnishings and whatnot (our mineral collection is quite large and probably worth more than everything else we own put together). That was the most coverage I was able to find, and it may not be enough coverage for people with a lot of expensive furniture and appliances in addition to an expensive collection.

That being said, if something catastrophic were to happen and everything I have was lost, I would only be able to seek reimbursement on the items that had a documented proof of value. Almost all of my collection and most of the more expensive stuff I buy for resale are cataloged with their purchase price and/or have sales receipts / proof of value in digital form (email, Paypal, bank/credit card statements, etc...). So at the very least, I would be covered for probably 75%+ of the total value of my collection and retail stock, which was good enough for me. The cost of having a professional appraisal and extra time involved in keeping better records in order to attain 100% coverage didn't really seem to be worth it, at least for me.

What you choose with respect to insurance really comes down to how expensive your collection is, your ability to maintain itemized proof of value for the specimens in your collection, and possibly also spending a fair amount of money for a professional appraisal if you have specimens that have appreciated in value significantly since they were purchased. Also, since insurance options vary greatly, even from one state/region to another, your geographic location also plays a factor as well.
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James Catmur
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PostPosted: Oct 24, 2018 12:11    Post subject: Re: collection insurance?  

I have looked into two approaches.

1) All the low value items are just included under a total value. The higher value items have to be listed individually. Proof of value is required for very high value items (I have none)

2) A total lump sum value, on the basis that no specimens exceed a certain value.

Both methods resulted in a similar premium. But when I tried to find a new policy I had to produce an itemised list (which I do have) so that they could consider them. You do have to go to a specialist insurer, but they do exist.
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Bob Harman




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PostPosted: Oct 24, 2018 13:48    Post subject: Re: collection insurance?  

I will try not to be too repetitive as some good points have already been made. My discussion is primarily for US collectors.

First off, critically evaluate the collection, both as a whole and for individual pieces. What might seem substantial value to you (such as personally collected specimens or those handed down from a grandparent etc), might not be worth a whole lot to some dealers and other collectors. Do the specimens have real $$$ value or more personal value, so is insurance really needed? How much will the yearly policy cost vs the value of the collection. How much work would be involved cataloging and appraising the collection before any policy might be issued.

Where and how is your collection housed? Is it in your house on shelves, cabinets or boxed up. And what kind of house and neighborhood do you live in; i.e., is the neighborhood generally safe or is there a home security system already in place? Is additional insurance for any item or collectible in the house really necessary?

Why is the insurance wanted? Would you be absolutely devastated if your collection was damaged or destroyed or just "upset", wanting to start over again or go on to something else.
What do you want your insurance payments to cover? Home burglary and vandalism? All natural disasters like an earthquake, tornado, or flood or a messy divorce with willful destruction by an irate spouse. I know of 3 collections destroyed. One by the Houston Tx hurricane flooding and 2 willful destructions during divorces.....they do occur.

If you are a dealer and minerals are your livelihood, this is totally different than just being a collector.

Homeowners insurance policies can issue rider policies for collectibles....ask your agent.
Read the fine print of exactly what the policy covers and what it does not cover. Flood insurance may be different. Willful spousal destruction costs might be difficult to recover.

Lots to consider before paying insurance policy premiums that may be inadequate or unnecessary. BOB
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Matt_Zukowski
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PostPosted: Oct 24, 2018 17:25    Post subject: Re: collection insurance?  

My auto, home, and umbrella is with one large insurance company. They originally agreed to insure my collection but then 6 months later told me that they did not have enough experience to underwrite mineral specimens so they cancelled the rider for the rocks. They did not suggest another vendor. So I talked to some other collectors, and they told me about another carrier that specializes in handling collections. When i contacted them, they told me they would insure my collection if i brought all my insurance to them (for much higher prices). I also found out through this process that: 1) receipts would be insufficient to prove value (i needed a "professional" appraisal, which they couldn't define further) and premiums would be about 0.6%/year of the insured value. Living in Alaska, i wasn't happy about having to fly someone up for a "professional" appraisal, which might be challenged by the insurance company if there really was a large claim to be paid. Given all this, what i have decided to do is to leave my collection uninsured. All my major pieces sit in a series of safety deposit boxes in the bank. This way i just don't have to worry about theft, fire, and seismic risks. And the cost of the boxes is way, way less than the cost of the insurance.
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Pierre Joubert




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PostPosted: Oct 25, 2018 01:58    Post subject: Re: collection insurance?  

Our collection is not insured. Everything is photographed, catalogued and the details are stored in a number of places; HD, DropBox etc. This will make things very difficult for a thieve to sell our specimens.
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R Saunders




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PostPosted: Oct 27, 2018 06:44    Post subject: Re: collection insurance?  

Thanks for the replies. I make back up copies to CD's to a fire box in the barn. Around 1974 I bought In Land Marine supplemental to my home owners insurance. For my tools of the trade and then camera equipment. One night my service van was broken into; they got the CB, a drill kit, and another box. I had to buy a replacement Milwaukee 5,000 RPM drill kit. Turned in the receipt and was reimbursed. Much later my son had my extra camera and it was lost in an auto accident and towing. Since not worth a lot they payed with out replacing. Gave up the policy due to cost.
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texasdigger




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PostPosted: Dec 19, 2018 13:54    Post subject: Re: collection insurance?  

I wouldn't count on getting a 250k payout with renters insurance :(

Sadly, insurance companies are not in the business to always pay out.
A common misconception is that homeowners/renters insurance provides coverage for all high value items in the home including collectibles. While some policies may cover your collectibles the amount of coverage is typically limited and may not be enough to cover replacement. Most policies cover up to a set limit for many specific categories of items. For example, your policy may cover a loss of up to $3,500 for any collectibles.

Make sure and verify in writing that the collection is indeed fully covered. Never trust a phone call with a representative because unless your collectibles have been specifically scheduled, your insurance company may refuse to reimburse you for them.

Insurance companies can be very grimey. I have stories and everyone has stories but they are not reliable under standard policies concerning collections and many other things. You'll likely require a rider policy.
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alfredo
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PostPosted: Dec 19, 2018 22:58    Post subject: Re: collection insurance?  

I think mineral collections could be difficult things to insure - Too much fuzziness regarding what "replacement value" would be, and too much potential for fraud (from the point of view of the insurance company). And what about pieces that were field collected or swapped? How would they be compensated? I know some companies have insured collections, and I'm sure they're happy to take your premiums, but getting money out of them in case of theft or destruction might lead to less than satisfactory results for the collector. Buying a really good safe might be a better investment than paying insurance premiums.
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John Betts




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PostPosted: Dec 20, 2018 13:36    Post subject: Re: collection insurance?  

Ask yourself what hazard you are insuring your collection against:
1. Theft
2. Fire
3. Broken water pipe
4. Tornado/hurricane

A thief is probably not gong to steal your mineral collection. He is going to steal your TV.

You can safeguard your collection from the other three dangers with a fireproof, heavily built room that will survive fires and storms.

Paying a monthly insurance premium is expensive and requires independent appraisals in advance for valuable specimens. Most policies I've seen amount to 5-10% of the value of the collection PER YEAR.

I'd rather save the money and make a one-time expenditure for secure storage.

Earthquake damage is a whole other risk and should be discussed with collectors from California.

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rweaver




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PostPosted: Dec 20, 2018 13:49    Post subject: Re: collection insurance?  

John Betts wrote:


Earthquake damage is a whole other risk and should be discussed with collectors from California.


And do not forget those of us in California who live near old Lava Flows, Cinder Cones and a major Geothermal plant. We can get both an Earthquake and/or a Volcanic eruption at any time. Just life in the Eastern Sierra part of California.
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alfredo
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PostPosted: Dec 20, 2018 22:17    Post subject: Re: collection insurance?  

I'd rather deal with the collection consequences of an earthquake than a fire, flood or tornado. ;((
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