When it comes to protecting your coin collection, you probably believe you have everything under control. After all, you’ve invested in slabbed coin holders to store the rare – and usually most expensive – pieces of your collection and placed them in coin album pages. That keeps them safe from handling and protects them from scratches and harmful chemical reactions.
So yes, you’re protected from that kind of threat to your coins. Unfortunately, there are other threats out there, too. They’re the kind that slabbed holders and special albums won’t control.
Burglars might not understand the value of your coins or the stories behind them, but they’re smart enough to know that they can convert them to ready cash. And what happens if your home catches fire? Or if a flood sweeps your albums away? You could lose years and thousands of dollars you’ve invested in gathering the pieces of your collection.
You can’t replace the sentimental value and the stories behind the coins you collected. But by properly insuring your collection, you can get the financial wherewithal to start over.
Threats to your collection
- Burglars: Maybe you’re not concerned about burglars. Perhaps you keep your coins in a safe-deposit box at a bank, where it’s nearly inconceivable that criminals will have access to them. The problem is, you won’t have access to them, either, which could limit your enjoyment. And what about when you go to an exposition? The collection won’t always be in the safe-deposit box.
- Flooding: So you don’t live in a flood zone? Neither did residents of Boulder, CO, earlier this year. Neither did a lot of people in the Northeast when Superstorm Sandy came ashore in late October 2012. Many of those people saw their possessions washed away, all the same.
- Fire: Fires also can happen anywhere and destroy a home and everything in it. The average residential fire claim in 2012 was more than $33,000, according to the Insurance Information Institute (III). How would your collection stand up?
How to insure your collection
The first step in properly insuring your coins is to know their value. The best way to do it is with a professional appraisal. One you know how much your collection is worth, dig out your home insurance policy.
Standard home insurance policies not only protect the structure of your house against fire, lightning, wind, break-ins, and other specified perils, they cover the contents of it as well. Usually, that coverage is capped at a percentage – usually 50% to 70% – of the amount it would take to rebuild your home should it be destroyed by a covered peril.
However, policies usually limit payouts for high-value items such as jewelry or collections. The limit often is $2,000 and can be as low as $200. That’s why you should know the appraised value of your collection. Say it appraises for $3,000 and your coin coverage limit tops out at $200: If the coins were stolen, your insurer would only pay $200.
You still have a couple of other choices to insure your collection for its full value:
- Scheduling an endorsement: This option allows you to increase the limit on your existing homeowners policy to an amount sufficient to reimburse you for the value of your coins in the event of a covered loss. However, that means you still don’t have protection from flooding or earthquakes, neither of which typically is covered by a standard homeowners insurance policy.
- Buying a personal articles floater: A floater is a standalone policy, usually sold by a company that specializes in high-value items. It often costs more than an endorsement; however, it comes with three major advantages. Personal articles floaters generally provide coverage from all perils, they don’t typically have deductibles – the amount you must pay toward a claim, and they offer coverage outside the home as well as inside. That means if you’re taking your coins to a show and they are lost or damaged, you would still have coverage.
Threats to your home and its contents come from many directions. Consider your collection, and be certain to protect yourself against the loss of your coins.
This article was written by Arthur Murray, a contributor to The Homeowners Blog at http://homeownersinsurance.com. The HomeownersInsurance.com website serves as a resource center for insurance consumers and homebuyers across the country.