Are Clients’ Most-Valued Items Falling Into the Gap?
By Laura Bergan
-- That teenage friend of yours who treasured his beer-can collection (all three of them) is now a 40-something man with thousands of dollars invested in beer steins.
-- That doting mother of three who watched her youngest child graduate from college is now a devoted collector with two second homes (both dollhouses).
-- That kid who loved to go to Disney World is now an avid collector of animated film prints.
People like these value their collectibles (for fun and sometimes profit). But they typically don’t realize that their collections are not insured.
Old cold ones are hot: beer cans are popular collectibles.
If there’s a gap in insurance coverage, insurance professionals ought to be ready to fill it. For collectible owners, here’s one such gap: most homeowners insurance policies do not adequately cover collectibles. And policies that do cover collectibles may pay claims based on actual cash value (depreciated value), not agreed value.
Why should you bother with this market? It’s a huge market, and it’s wide. And those who collect consider their collectibles to be among their most-valued items.
Going to the chapel? Thousands of Precious Moments enthusiasts are. The company’s 30th anniversary party is being hosted at the “Precious Moments Chapel” and theme park in 2008.
The Collectors.org directory, the official web site of the Association of Collecting Clubs
and the National Association of Collectors, lists more than 2,500 clubs in the United States. These include the expected: the Toy Train Operating Society, Barbie Collectors Club, Christmas Ornaments Collector Club, and Musical Box Collecting Society. But there’s also the unusual: the American Credit Card Collectors Society and the Antique Snowmobile Club of America. Then there’s the Central California Avon Bottle and Collectible Club, as well as the 195-member Yahoo Thimble Group.
Tom Kanyuk, co-founder of American Collectors Insurance, is one of thousands of Americans who collect and build model railroads.
Do collectors have devotion? The Precious Moments Collector’s Club shows it. They’re flocking to the Precious Moments 30th anniversary party in 2008 at its “Precious Moments Chapel” in Branson, Missouri.
Do collectors have passion? Yes, for just about anything (the credit card collectors meet every year -- for three days).
The Association of Collecting Clubs reports that people are now collecting Arizona tea bottles, clothes hangers, company ties, women’s slips, and wire spoons.
Now not all collections are insurable, or even valuable. But the point is: yes, people will collect just about anything. While high-end collections such as art or antiques, there are millions of people who need to insure their collections of choice.
One observer opines that men represent the future of the collecting market. Collectors under 35 years of age typically are men. “Men tend to exhibit a different pattern in their collecting lives,” noted Pam Danziger of research firm Unity Marketing and author of the book Why People Buy Things They Don't Need . “They [men] carry their collecting passions right from childhood through early adulthood and then on into maturity, while women tend to delay active collecting until they reach 35 years or so, after the children are out of diapers and in school.
“Men also tend to be more motivated by the thrill of the hunt than women do. And they also view their collections as more of an investment," Danziger explained.
Even if collectibles are covered by a homeowners policy, the normal exclusions apply, such as accidental breakage, flood and earthquake. Also, homeowners policies typically will not insure at a collector market value. Further, a deductible of $500 or more applies to an insured loss. And while it is possible to add a collectibles endorsement to most homeowners’ policies, several exclusions still may apply.
Some of the popular collections we’ve seen include: figurines, dolls, teddy bears, vintage toys, die cast cars, miniatures, collector plates, holiday collectibles, animation art, sports memorabilia, model railroads, vintage advertising, militaria, pottery and more.
We recently insured an antique balls and cups collection for a professional magician. Then there are the collections of glass and porcelain telegraph insulators, antique writing instruments, and Civil War memorabilia. And vintage Barbie dolls and Star Wars collectibles are among the more common and popular collections that agents refer to us.
Laura Bergan (Laura.B@AmericanCollectors.com) is director of marketing for American Collectors Insurance (www.American Collectors.com). The firm, among the pioneers in specialty personal lines when it was founded in 1976, offers insurance for collectibles and collector-vehicles through independent agents.