So, you've poured your heart and soul into your collection.

And then one day, your better half walks in, and asks, "So......how much do you figure you have tied up in all this stuff anyway?"

After a moment of silent, bemused mental calculation, you start to say, "Oh, it's worth about....."    And then,  suddenly,  the wisdom of keeping your mouth shut, or telling a little white lie for the sake of the relationship occurs to you.  Like Momma always said, "What he don't know, don't hurt him", and besides, he has that stash of baseball cards he adds to when he thinks you're not looking.

One thing about collectors, they marry other collectors, and they generally have several collections going at once. Collections are like Tribbles. You start with one collection, and suddenly you realize you have lots.  And collections sneakily expand, until suddenly your treasures have absorbed a great deal of money.

How should you insure them?

First of all, if you are a renter, understand, your landlord's policy does not cover your things. You are not his responsibility. If you do not have a renter's policy, go get one ASAP. You need to cover your furniture and other belongings before you even begin to worry about your collection.

A standard homeowners or renters policy places limitations on items like jewelry, sterling, stamps, coins, cash, gift or stored value cards, documents, antiques, and often on guns, too. Many policies are now specifically addressing more contemporary collectibles, too. For example, my own homeowners policy places a specific $3,000 limit on trading cards and comic books.

Even when coverage does exist on collectible items, claims may be paid on an ACV (actual cash value) basis.  Simply put, ACV is the replacement cost of the item, less depreciation. How do you figure depreciation on a collectible item? What are the odds your adjustor knows the value of a Sideshow statue? A NASCAR toy? A Danbury Mint plate?

There are two relatively easy ways to address this issue.

First, you can add a "Schedule" to your homeowners or renters policy. A schedule not only broadens coverage, but will state that an item is worth a specific value. There are, however, a couple of drawbacks to this method. The insurance company may require you to prove (after the fact) what the value of the item actually is. Also, many companies require that items be individually scheduled. If you have a collection of Van Gogh's, that's probably not a problem. But, if you have a collection of 100,000 baseball cards, now you have a problem. Discuss the situation with your insurance agent. With the approval of a company underwriter, you may be able to bypass the requirement to list them seperately, by providing them a list of all items in your collection, and then insuring the entire collection as a single entity, for one set value. You can generally expect to pay in the range of (approximately) $15 per $1,000 of coverage. 

Two other important things to consider are: Do you add to your collection frequently? You may need to increase your coverage on a regular basis.  Scheduled items do not generally have an inflation guard built in, like your building and other contents coverages might have.      Do you sell on Ebay, a website or at trade shows? Under the terms of the policy, you may be considered a business, which could restrict or completely negate coverage.

If your collection is comparatively small in size and value, and relatively static in turnover, a simple schedule may be your best bet.

If, however, your collection is  moderate to substantial in value, and/or you sell via online sites or at shows, you may wish to consider a (drum roll, please) Inland Marine Policy.  This is a fancy way of saying a stand-alone schedule or floater.

Because of my background in insurance, I researched potential policies extensively for my own collections, and decided on a policy with a company called http://www.collectinsure.com/

First, please let me state, I do not have any professional relationship with this company. I just like the policy, and I like the approach to it.

Their policy has several features I like.  First of all, they provide All Risk coverage, subject to policy terms, conditions, and limitations. (I am biting my tongue here, since there is no such animal as true "All Risk" coverage. Always read your policy!!!!)  They do not require a list or photos of items. I can value my cookie jars, paperweights, and Olympic Pin collections individually, but keep them all on a single policy (cheaper and more efficient for me). Coverage is worldwide, and includes some coverage if I loan items for exhibition. It even includes coverage for my related "business activities"  if I am selling and trading on a hobby basis, as well as some shipping related coverages.

The application is simple, coverage is in an easy to read format, the paper is written on an A+ rated company, and their website is very clearly and intelligently written (as well as interesting!) They "say" they treat the collector/insured as their own expert, the one who is most knowledgeable in their field. Not having had a claim, I can't vouch for that, and hope never to have to. But it does intrigue me that I would have more of a say in settling my own claim, and it certainly sounds more appealing than dealing with a regular homeowners adjustor who is used to evaluating bedroom suites and contents of closets, rather than shelves full of Frodo or my beloved Jack Skellington cookie jar. 

There is are two small drawback to this policy. First, they don't cover jewelry. I think my costume  LOTR jewelry would be fine, but I have about half a dozen sterling Noble and promo items,as well as an 18 karat version of the One Ring,  which would certainly be excluded. I can live with that.   Also, they have no flexibility regarding deductibles. I am a firm believer in high deductibles, but that's a sermon for another podium.

Best of all, the premium is a fraction of what scheduling all this stuff on my homeowners policy would have been. The higher the worth of your collection, the more of a value the floater becomes.

Now, in spite of the reassurances that they do not require photos or a list of items, you would be foolish not to keep one on hand anyway. In these days of digital cameras and camcorders, it is fast and simple to go through your entire home, photographing everything.  Fling open your closets, pull out your drawers, photograph the knicknacks on the shelves. Do it on the highest resolution setting that your camera has, and take the clearest photos you can. Burn them onto CDroms, and keep the disks in your desk at work, in your safety deposit box, give a copy to your sister or best friend.

One of the saddest things I ever saw in my long years in the insurance business was a woman whose home had burned to the ground. She literally had to start out afresh, with a toothbrush and nighty, just to make it through that first night. In moments (and endless following weeks) of stress, there is no way you can remember all the things you had on your walls, in your drawers, and so on. I will never forget the day she called me one chilly day, nearly six months after the fire, crying her eyes out. It had never occurred to her that she'd lost all her winter clothing, too, and she didn't even have a coat to wear. 

Save yourself the heartache. Insure properly, and document well.

This information is intended for American collectors. There are valuable points for non-US collectors, however, your property policies and coverage are totally different from ours. Because policies vary from state to state, and carrier to carrier, you should always consult your agent for proper coverage advice, regardless of where you are located.