Three Key Considerations for Insuring Collectibles

Barbie dolls, comic books, clocks, sports memorabilia, model trains, coins, and wine – have you ever been shocked to walk into an insured’s home and find more than one or an entire room devoted to a collection?

This is the insured that knows what they have.  They can tell you what that Superman Action Comic book sold for or the current price of a first edition Barbie Doll on Ebay.

There are plenty of carriers that cover collections like these.  But when you are looking to insure a collection you need to know a couple of things: usage, storage, and value.   This will help determine what type of policy they need and endorsements they might require.

Usage:

When I say usage I mean are they collecting or are they selling?  Collectors go to shows like the Toy Train Operating Society Family Train and Toy Show or Doll Show USA.  They can go to trade, compare, and chat about their collections.

Storage:

Their collections are generally displayed, set up, working, and a distinct part of their lives.  They are not stored either in damp cold place in the basement or in a child’s possession or in the child’s bedroom.

If they are kept offsite like wine – they are in special storage locations.  As an example: Western Carriers is a storage facility that specializes in storing private collections of wine.

You may also run across sports memorabilia collectors who have some of their collection displayed at their office while some are displayed at home.

Value:

Collectors have inventory lists, photographs and certificates of authenticity.  They use Professional Sports Authenticator (or PSA) to assist identifying and slabbing their collection.  Either way, they will be able to tell you a value.

Like collector cars, there are stated and agreed value policies.  Make sure they have coverage for when they transport and package their items off premises or cover collectibles being shipped to them by an online seller.  Some of the collectibles companies have an endorsement to cover that type of exposure.

The insured may refer to their collectibles as ‘inventory’ and have established websites to sell their collections.  This is a business, not a collection.  This would be better suited on a BOP or Business Owners Policy, not a collectibles policy.

On the onset, it may be tricky to tell what kind of policy they need.  Upon giving these three points attention, you will be able to discern between the hoarder, the business, and the collector.  It’s good to have that conversation with the insured to make sure you have proper coverage for their type of exposure.

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