(April, 2009)
This insurance provides coverage on a special form basis
for philatelic property and/or numismatic property. It may help to know the
following:
· Numismatic property - Refers to coins, medals, tokens and similar property.
· Philatelic property - Refers to postal or revenue (tax) stamps and related material.
Coverage applies while such property is owned by or in custody or control of the insured. Insurance may be written on a blanket or scheduled basis, usually by making the Stamp and Coin Collection provisions of a Personal Articles Floater policy or Homeowners Scheduled Personal Property Endorsement HO 04 61 effective. Please refer to PF&M Section 430.1, Personal Articles Floater and also please refer to PF&M Section 460.6-15, ISO Scheduled Personal Property Endorsement for more coverage details.
Stamp and Coin Collection Floater insurance covers the following:
Philatelic property |
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Postage stamps |
Stamped envelopes |
Postage due stamps |
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Official stamps |
Revenue (tax) stamps |
Match stamps |
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Medicine stamps |
Covers |
Locals |
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Locals |
Reprints |
Essays |
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Proofs |
Books |
Pages and mountings |
Numismatic Property |
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Rare coins |
Current coins |
Medals |
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Paper Money |
Bank notes |
Tokens |
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Coin albums |
Containers |
Frames |
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Cards |
Display cabinets |
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Coverage is provided for all of the above and similar property that is in an insured’s possession or control. For more information on the above property, please refer to PF&M Section 430.6-2, Coin Glossary and also please refer to PF&M Section 430.6-1, Stamp Glossary.
Insurance protection is typically provided against all risks of physical loss (except as excluded) and may be written on a:
· Blanket basis,
Example:
Pete Laminate's Schedule |
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|
Items Covered |
Amount of Coverage |
Premium |
|
Collection of stamps (200), Stamp books and mountings |
$1,500 |
$25 (policy minimum) |
· Scheduled basis, or
Example:
Klara Blank's Schedule |
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|
Item Covered |
Amount of Coverage |
Premium |
|
1878 Hunter Silver Dollar - mint cond. |
$1,500 |
$12 |
|
1906 Native Bust Cent - very good cond. |
$900 |
$8 |
|
1916 Running Servant Half Dollar - extra fine cond. |
$180 |
$1 |
|
1909 St. Baubles $20 Gold Piece - very good |
$1,790 |
$15 |
|
1796 Draped Hair Half Nickel - extra fine cond. |
$1,400 |
$10 |
· Combination of blanket and scheduled coverage
The combination approach would be suitable for insureds who own individual pieces of property with high values (i.e., along with property that gains substantial value on an aggregate, rather than individual basis.
Coverage applies while the property is located anywhere in the world.
The policy does not insure listed property against the following situations or sources of loss:
· Wear and tear, gradual deterioration, insects, vermin, or inherent vice,
· Fading, creasing, denting, scratching, tearing, thinning, or transfer of colors,
· Inherent defect, dampness, extremes of temperature, or gradual depreciation,
· Any damage from handling or working upon,
· Disappearance of individual stamps, coins, or other articles,
Note: There are exceptions to individual items that disappear. Coverage is provided if the item is described and scheduled with a specific amount of insurance, or if the item is mounted in a volume and the page to which it is attached is also lost.
· Loss to property in the custody of transportation companies,
· Loss to property while shipped by mail (unless it is by registered mail),
· Theft from any unattended automobile unless being shipped as registered mail,
· Loss to property which is not an actual part of a stamp or coin collection.
In case of loss of or damage to an individual article (a single coin, stamp, etc.) that is scheduled in the policy, the company will pay for or make good on the insured’s loss or damage. However, the recovery (payment) will not exceed the limit of insurance that is listed for the applicable lost or damaged item.
Example: - Scenario One - Jarla Monynut’s home was burglarized and, among the items stolen, was a 1907 Silver Liberty Dollar. The item was insured under a schedule for $2,150. When adjusting the loss, Reasunabul F & C finds that the cost to replace the item exceeds $1,600. Jarla is paid $2,150 for the lost coin.
Example: - Scenario Two - Jarla Monynut’s home was burglarized and, again, among the items stolen was a 1907 Silver Liberty Dollar. The item was insured under a schedule for $2,150. When adjusting the loss, Reasunabul F & C finds coin dealer that is willing to sell a comparable coin for $1,900. The insurer buys that coin and gives it to Jarla.
In case of loss of or damage to property scheduled as pairs, strips, blocks, series, sheets, covers, frames, cards or other sets, the insurer will do as follows:
· Total Loss – will pay up to the maximum dollar amount that appears as the applicable insurance limit (when less expensive options such as replacing the property are not available)
· Partial loss - will pay an amount equal to the cash market value of the entire pair or set, minus the cash market value of the remaining property at the time of loss. Besides being subject to the availability of replacing or repairing the property, there is another limitation on any settlement amount. The insurer will pay up to the maximum amount equal to the proportion that the limit of insurance bears to the cash market value when the affected property is insured for less than its cash market value. This limitation protects the insurance company in instances when the scheduled property has substantially appreciated in value, but the insurance limits have not been increased.
Example: Let us use Jarla Moneynut again. This time a windstorm topples a tree unto her home which crashes into an upstairs bedroom. Part of the property involves a very rare block of stamps. One of the stamps, commemorating the coronation of a famous Burgher of Yorwayland, was irreparably crushed. Several expert sources estimate that the block lost 30% of its current market value. The block was scheduled ten years earlier with a limit of $800. The schedule was never changed even though the current value of a set that is intact is $2,400. Rather than pay Jarla 30% of the current value or $720 ($2,400 X .30), the maximum payment is modified to compensate for the fact that Jarla was irresponsible in not getting her property appraised. In this instance, the maximum Jarla could recover is $240.48 ($720 X .334 [$800÷$2,400]).
Policies may be written on a blanket basis subject to a limit of $1,000 (commonly used by various insurers) on unscheduled numismatic or philatelic property and subject to a limit of $250 (commonly used by various insurers) any one unscheduled stamp, coin, or other individual article or any one pair, strip, block, series, sheet, cover, frame, card, etc.
The company will not pay a greater proportion of any loss on blanket property than the amount insured on blanket property bears to the cash market value at the time of loss. This limitation protects insurers in instances that an insured “blankets” property valuable enough to have been separately scheduled as well as in instances when the aggregate property substantially appreciates in value.
Example: Remember Pete Laminate? He had the following appearing on his coverage:
Pete Laminate's Schedule |
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Items Covered |
Amount of Coverage |
Premium |
|
Collection of stamps (200), Stamp books and mountings |
$1,500 |
$25 (policy minimum) |
One evening, Pete discovers that a knowledgeable thief broke into his house and stole just one item from his stamp collection: a 1904, Canadian Blue Albatross. The albatross had a market value at the time of loss at $400. The insurer asks some questions and finds that, rather than a humdrum assortment of marginally collectible stamps, Pete's collection is admirable, easily worth $8,000. Instead of reimbursing him $400 for the loss of his best stamp, he is given $75 which reflects the stamp's percentage of 5% ($400 ¸ $8,000) of his collection that should have been fully insured.
Schedules and insurance values must be determined with care and honesty. Typically, policies contain a condition that voids coverage if the insured has concealed or misrepresented any material fact or circumstance concerning the insurance. Fraud, attempted fraud, or false swearing by the insured in connection with the insurance or a claim renders the policy void.
The best prospects for Stamp and Coin Collection Floater insurance are individuals who seriously collect stamps or other philatelic property or coins or other numismatic property. Most earnest collectors take pride in their special property and typically exercise great care in handling and protecting their collections. Applications for the insurance should be rejected where there is any indication of a moral hazard.
Policies may not be issued to dealers, auctioneers, societies, clubs, organizations, or in other instances under which insurance or replacement of property is granted to or enjoyed by individuals under an insurance certificate (group coverage). However, subject to individual company requirements, a policy may be issued to stamp, coin, or similar societies to cover special exhibitions IF the event is held under the name and supervision of an insured.
Coverage is typically only available in the name of two or more persons when the insureds are related and reside together. Property that is jointly owned by two or more unrelated parties can be problematic to handle in the event of a loss. Requests to provide coverage on a blanket basis should be carefully reviewed, making certain that the amount of insurance requested is in line with the actual cash value of the property. Specific description of major items with the balance covered on a blanket basis is often a smart coverage option.
It is important to get a complete list of the items to be insured under stamps or coins separately. For bulky items or large collections, it is not essential to schedule each item, but it is necessary to obtain a description and values of the items insured and storing the information in agency and/or company files. Values for this class of property fluctuate by nature, so it is important to review insurance limits at least annually.
Owners of collections of substantial value often keep the property in fireproof safes or vaults. Such use is a valid suggestion when considering applicants or insureds who do not use special safeguards or precautions.
In order to avoid or minimize customer disappointment, any special property limitations should be fully explained, such as loss involving:
· mysterious disappearance, theft from unattended automobile,
· $250 valuation on certain items, and
· transportation.
Problems can be avoided by discussing such basic limitations with the insured when coverage is arranged.
Annual rates in widespread use typically are quoted per $100 of insurance and $.45 or greater for stamps and $1.25 or greater for coins may be found in the insurance market. Credit premiums (typically 10%) are applied to the total premium if a fireproof safe or vault is used to store the property. Sometimes an insured has to agree that a minimum level of covered property is always kept in the safe or vault (such as 75%).
Unattended Automobile clause – under this option (not available with all insurers), the exclusion for theft from an unattended auto may be deleted. Typically this option is available for an additional annual premium such as 5% of the premium charged for the entire stamp and coin collection.
Example: Let's visit Klara Blank again. We now find that her schedule, after a policy renewal, shows a bigger collection.
Klara Blank's Schedule |
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Item Covered |
Amount of Coverage |
Premium |
|
1878 Hunter Silver Dollar - mint cond. |
$1,500 |
$12 |
|
1906 Native Bust Cent - very good cond. |
$900 |
$8 |
|
1916 Running Servant Half Dollar - extra fine cond. |
$180 |
$1 |
|
1909 St. Baubles $20 Gold Piece - very good |
$1,790 |
$15 |
|
1796 Draped Hair Half Nickel - extra fine cond. |
$1,400 |
$10 |
|
2000 Sacajawea Gold Dollar with rare, double-strike error - mint cond. |
$3,200 |
$20 |
|
1861 Civil War Half Dollar - fair cond. |
$2,800 |
$17 |
|
1911 Taft Quarter |
$4,150 |
$30 |
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Bag of Toledo Mint, Petey R. Jones nickels |
$1,100 |
$9 |
|
Total |
$17,020 |
$132 |
Klara asks that her policy's unattended automobile clause be removed. Once it is done, she receives an additional bill for $6.60 (5% of her schedule total).