Train insurance? Do I need to get this stuff appraised?

[jimhaleyscomet]

It sounds as if you are right on target!

 As you create your database be sure to have a "replacement value" column.  For instance, if you have an old ZW (approx $185), then put in the replacement cost of a new modern ZW (are they about $350 now?).  That way you can chose what to replace. 

 With any insurance (and especially replacement insurance) you want to value your stuff as high as reasonable unless it drives up the cost of the policy (ie exceeds the personal property limit).     That is why the company sometimes require an estimator (to keep the values in line) especially on collectibles (which are not covered at all on my policy).  Still, if a train or a similar item can be purchased new then the manufactures list price at retail value is a great value to use and will usually be reasonable to the insurance company and agent.  Just don't let inflated values drive up the cost of the coverage you desire.  As I said before....there is no reason to "win the lottery" just because your stuff got destroyed.  You just want enough money to replace the items you would be very uncomfortable living without.  

 Jim H

[kpolak]

Thanks for the information!

Here's my assessment of the situation...It may not be right.

1.  Photograph trains, acessories, track, etc.

2.  Create database, including value based on current published values.  (Greenburgh and Doyle books).  Not always current, but verifiable.

3.  Make sure I don't exceed personal property rider on homeowners policy when combined with other personal property.  (not likely in my case)

4.  Review with insurance agent, and keep copy in safe deposit box.

Thanks again,

Kurt

[Buckeye Riveter]

Check with an agent.  Different states do completely different things with insurance.  As I have owned property in Ohio, Indiana and NY, I have seen some funny little differences in homeowners.  

[sir james I]

It's my understanding that unless the policy has a rider for your collection it's treated like an uninsured peice of jewelry. They would only pay up to policy limits like any household items, you could lose it all and only collect say $500.00. Check with your insurance agent. Do not take my statement as fact.

[jimhaleyscomet]

My policy makes a big distinction between "collectibles" (not covered without a rider) and non collectibles (covered).  Collectables are things not relatively easily available new from retailers (think retired beany babies, rare lionel cars/colors).  Non collectibles are usally available new...say the Christmas target set from last year that has been opened and run.  You could always buy a replacement next Christmas.  Under this definition everything I own is not collectible since I run it all.  While it may not be possible to replace my K-line desert storm set, I could find something fairly similar at new retail.  Even my 1957 ZW could be easily replaced with a new ZW (yes I know the insides are different, but the function and outsides are similar).   The key here is they do not want to get stuck insuring a $600,000 "rare" item without an appraisal.   I keep an excell spreadsheet with all my rolling stock, switches, track buildings etc.  Also, one week I put all my trains/boxes out on the floor and took about 10 pictures of groups of trains.   Now I figure my standard homeowners insurance policy will fairly closely cover them under existing coverage.

One other item to think about when you decide on insurance.  Insurance should only be purchased where it would REALLY HURT or be impossible to write that check for a replacement.  For example, say one totals a new $40,000 car and/or suffers a $1,000,000 liability claim and/or needs the replacement car for work tomorrow.  And say one does not have the $40,000 or $1,000,000 to write another check.  Then one needs insurance.  On the other hand, if one could go without the car or switch to a $1000 car for a few years then one does not really NEED insurance.  It is just a luxury, even though writing that check would be painful.  

I believe trains fall into a second catagory of "optional" items.  If a fire destroys the house one does not need to immediatley go purchase $20,000 in trains.  One could spread it out over the next 5 or 10 years.  Since I am in  this second case I decided I do not need to insure my trains with a separate policy.  I might make an insurance claim, but if they decide not to pay I will not suffer extreme financial hardship.  

 I see many people with the wrong amount of insurance.  Many people have no life insurance wich leaves their young kids in a lurch when they go.  Just as many have too much insurance.  If your kids are grown and there is $1M in your IRA does your wife really need more.  In that case insurance is just a "lottery" ticket. Sure people who suffer a major loss and carry excessive insurance get a big payout...kind of like winning the lottery.  But I don't gamble.  I would rather put that $400 or $1000 per year spent on train insurance on buying one nice engine or a few sets per year.  After 10 years I will probably have 10 more engines or 20 sets more than I would have had.  Now who is the winner?  

I always try to buy enough insurance to cover my liabilities (auto, life insurance for kid's college...) and "self insure" lifes smaller values.   

What you do is up to you, I just wanted to give you some options. 

Jim  H 

[spikejones52002]

I started to play around with Paradox database program.

I started to build a list of my "G" railroad equiptment. I listed the price I paid and suggested retail price. That is when I realized how much I had and now much I had invested.

I went to my insurance agent. He found American Collectors (something). They had three coverage policies. I took the middle at my agents suggestion.

I found out he added up the price paid. Not what it would cost to replace. So never state the price you paid, only the retail price. I know some of my stuff would cost me a great deal more to replace.

Know this most polices, if you do not replace it you do not get paid the value (replacement costs)(up to price paid).

 Well I had coverage for a couple of years. I submited a new database print out and increased my limit. As I remembered I was paying about $400.00 a year for $30,000.00 (poor memory).

Well after another year or two I received a billing (I had auto payment). I looked it over and all I had on the statement is "? collection coverage ?" pay $400.00.

 I went to my agent. I asked him what is covered. All I have is a blank sheet.

He just said that he has my database print out. I said the bill does not even state "trains". 

His comment was do not worry about it.

I canceled it immediately. 

[rtraincollector]

Ok...So I'm getting to the point of a small collection, and was wondering how do you value this stuff...if the unspeakable happens?

For the most part this should be covered under our homeowners insurance.

But who decides what it's worth?  We have replacement value on our policy, but with 60 YO trains what does that mean?  Do I need to get this appraised?  By who?

Thanks,

Kurt

I'd talk to your agent then get it in writing what all is covered by your policey as your home owners policey normally don't cover your collectables as much as you think. like said above there are a couple in ctt and I believe your most likely better goig with them I believe its less than $100.00 a year for about $10,000 coverage.

[Jumijo]

Some specialty insurance companies do not require appraisals under a certain amount. I've seen a few advertised in CTT and the other mag.

Still, I'd photograph each piece, and document the purchase price.  

[kpolak]

Ok...So I'm getting to the point of a small collection, and was wondering how do you value this stuff...if the unspeakable happens?

For the most part this should be covered under our homeowners insurance.

But who decides what it's worth?  We have replacement value on our policy, but with 60 YO trains what does that mean?  Do I need to get this appraised?  By who?

Thanks,

Kurt