You might be someone who has amassed a huge collection of favorite records, stamps, artwork or limited edition McDonald’s Happy Meal toys. You also might have paid a pretty penny to get your collection. What would happen if, in the worst-case scenario, it was all gone in a flash?
“Whether or not you should insure your collectibles depends on their value and significance to you,” said Shawn Davies, CFA and founder of Digital Connect Mag. “If you have valuable collectibles that would be difficult or expensive to replace, it’s generally recommended to consider insurance coverage.”
It can happen due to fire, flooding and other natural disasters. Theft or damage can ruin the value of your vintage cars, rare books, sports memorabilia and anything else you might have in your collection.
Should you insure your collectibles?
Always Consider Insurance for Collectibles
Just like homes and cars, you should consider purchasing some insurance for your collectibles. With rare items, you might not be able to replace them, but you can be made whole or semi-whole financially in the event of a disaster.
“It is always wise to insure your collectibles,” said Greg Rozdeba, co-founder and president of Dundas Life, a digital insurance brokerage. “You must know that most home insurance companies do not cover collectibles. If they do, they might offer a low-coverage option for them. Insuring collectibles is important, just like other home items. You can approach private firms to have your collectibles insured.”
To start the process, you can take a few steps on your own. Document all of your collectibles using pictures and video. Gather supporting documentation such as detailed descriptions of the items or certificates of authenticity.
“Contact insurance companies that specialize in collectible insurance or consult with your current insurance provider to explore coverage options,” said Brian Clark, founder of United Medical Education. “It’s important to review and understand the terms, conditions and coverage limits of the insurance policy. High-value collectibles — such as rare coins, stamps, fine art, vintage cars or sports memorabilia — are typically the types of collectibles that should be insured due to their significant worth and potential for loss or damage.”
Buying insurance for your collectibles is not expensive. However, it’s important to know that the annual premium will be determined by the types of collectibles you are insuring, which could cause it to be pricier for some policies.
Options for Insurance
Some companies that offer collectibles insurance:
- American Collectors Insurance: Offers insurance policies to protect your collection with agreed value insurance coverage so you have an exact dollar amount tied to your collectibles at the time of the loss.
- Collectibles Insurance Services: $0 for collector policies is the starting deductible price at Collectibles Insurance Services. That means the market value for your collection for losses in excess of $50 is covered. Are you a dealer? You automatically have a $500 deductible with your policy.
- MiniCo: Partnered with an A-rated carrier, MiniCo provides comprehensive coverage at “a competitive premium when compared to traditional homeowners policies,” according to its website. Plus, it insures collectibles wherever you might choose to store them.
Check your current coverage first because your collection might already be covered. If you have homeowners insurance or renters insurance, review your policy to see if there is language that would extend coverage to your collectibles.
“Your standard home insurance will cover your collectibles,” said Brandon Frady, a licensed insurance agent with ExpertInsuranceReviews.com. “Unfortunately, the limit is typically set at $1,500 to $2,500. So, you don’t need to worry about additional coverage if you have a collection worth that much or less. However, if your collection exceeds the limit on your standard home policy, you should consider collectibles insurance.
“You may be able to add a rider to your home insurance that covers your collectibles,” Frady added. “This option is convenient because you can use the same company and make just one payment each month or however often you pay.”
Review Your Policy Regularly
It’s never a one-and-done situation though, and it’s important to constantly revise and review your policy based on your collection. Make sure to insure your collection up to its estimated value. If you insure it for less than the estimated value, your policy may not provide you with the full protection or compensation if your items become the victims of theft, damage or loss.
As your collection grows or the place where you store your precious finds changes, you’ll need to update your insurance so your collectibles stay safe and sound.
“As the value of your collectibles changes over time, it’s essential to reassess and update your insurance coverage accordingly,” Davies said. “Periodically review and adjust your policy to ensure you have adequate protection.”
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