Viewpoint: Time to think about your insurance?

By Carrie Van Brunt-Wiley

Hurricane Sandy has left many collectors feeling vulnerable even though they were nowhere near the affected area. They wonder if they are adequately prepared if fate should deal them a blow.

They have spent a great deal of time on the research, acquisition and preservation of their coin collections. They want to not only protect their coins, but also their own significant financial investment in them. They need protection not only from life’s headline-grabbing storms, but also from the more commonly occurring threats like theft.

If this sounds like something you have been thinking about in recent weeks, it might be time to think about the state of your insurance protection.

First, ask if you have spent enough time considering the insurance options you have for that collection to protect it in the event of a home burglary. According to Department of Justice crime statistics, there were approximately 1.6 million home burglaries committed in 2009. The loss for each homeowner averaged around $2,096. If your home suffered a burglary, would you have sufficient coverage to replace your coin collection? There are a few different types of insurance policies that coin collectors should consider to ensure they are properly protecting their coins.

You have three basic options for the type of insurance policy you may need to cover your collection. The value of your coin collection and type of perils you want to be protected from may determine which of these are right for you:

A standard homeowners insurance policy: For the novice collector whose collection may not be very extensive, a standard homeowner insurance policy might provide enough coverage. Under a standard home insurance policy there is coverage provided for “personal property” stolen from the home. However, the limits placed on items such as coins are very low. Most policies, for example, have a limit of around $200. This means that a standard homeowners policy would pay a maximum of $200 towards your coin collection in the event of a loss. For most collectors, this is not enough to cover their collection. They might even feel insulted by it.

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Scheduling an endorsement on your homeowner’s policy: If you like the convenience of having all of your insurance policies covered by one carrier, then you might want to consider scheduling an endorsement on your current homeowners policy for your coins. Doing so will increase the coverage limit you have for your collection. Your coverage limits can be set based on the value of your collection. However, you will need to present your insurance agent with an appraisal showing the value of your coin collection.

Purchasing a personal articles floater: Some coin collectors prefer to purchase a personal articles floater, which is a separate policy that is purchased with the sole purpose of insuring a single item – such as a coin collection. The benefit of purchasing an entirely separate policy to insure your collection is that you can purchase it from a company that specializes in insuring coin collections. This means that they may provide coverage more specifically tailored to suit your needs. For example, a personal articles floater may provide coverage for your collection while you are traveling to a coin show, which a standard homeowner’s policy usually won’t cover. If you are purchasing this type of policy from an insurer that you don’t know much about, be sure to do your homework. Find out what type of financial ratings and customer support services they have. Ask who will be underwriting the policy.

Whatever type of policy you decide to purchase, make sure you have a strong understanding of the coverage limits and deductibles that come along with it. Ask your insurance agent lots of questions so that you can be sure you are getting the type of coverage you really need.

Nobody likes to think about doing paperwork rather than spending time with their coins, but a little time spent on insurance paperwork now will help you recover quicker from any storm that life sends your way.

This “Viewpoint” was contributed by Carrie Van Brunt-Wiley, Editor of the HomeInsurance.com blog. Viewpoint is a forum for the expression of opinion on a variety of numismatic subjects. To have your opinion considered for Viewpoint, write to David C. Harper, Editor, Numismatic News, 700 E. State St., Iola, WI 54990. Send email to david.harper@fwmedia.com.