August 31st, 2009
Hands up anybody who has ever collected anything in their lives. Probably most people have, at one time or another, collected a variety of things such as stamps, bubble gum stickers, Zippos or toy sets from breakfast cereal boxes. Usually, after a number of years, boxes full of various treasures have ended up in the attic, covered in dust, or even finding a permanent home in the garbage bin.
For sure, there are some among us that have never given up this sometimes strange habit and have turned it into a lifelong hobby. There is, however, a certain breed of collectors, who have taken this hobby to a higher level and have diversified their portfolios by investing in valuable coins or stamps.
So, why is there a need for special insurance coverage?
Consider this: normal household insurance is quite adequate if you just need to cover everyday items such as TV’s, computers etc. But collectibles are a different matter entirely. In certain situations low value collections may be covered, but submitting a claim to the insurer is fraught with difficulties and can often be unsuccessful. Most household policies normally only cover the material cost of lost or damaged property. It is relatively easy to claim for a damaged front door or smashed window, but try claiming for a priceless Blue Mauritius stamp.
So, Mister Collector, what should you do if you have a stamp or coin collection that is worth more than the house that it is kept in? Are you having sleepless nights worrying about its safety? Fortunately, there is an easy solution in the form of specialist collectibles insurance coverage. These policies are affected by some of the bigger players such as AIG (through their Private Client Group), Allianz (via previously mentioned Fireman’s Fund policy) and also by a number of smaller providers.
As an avid, collector, you should consult with a licensed insurance broker and should probably look into to selecting an ‘all risk’ policy which would cover your beloved collection for things such as theft, flood, fire, normal wear and tear and even a nuclear disaster or mysterious disappearance.
New items that are added to your collection can usally be added to your policy by means of a phone call. You can even do this before you go to collect your new piece so that it is insured before you even get your hands on it.
Obviously nothing can replace your cherished collection, should it be destroyed by fire or stolen by some hard-hearted thief. However, the pain can be lessened somewhat, if you have adequate insurance cover in place for the full value of the collection.
Please note this above is provided solely for informational purposes. It is not intended to be financial or other professional advice or an opinion of any kind. You are advised to seek specific advice by a licensed insurance broker.