INQUIRY: Insurance for a train collection -- worth it?

Here's a fairly exhaustive (and exhausting) thread from about a year ago.

https://ogrforum.com/...0#161067874940613760

My 2 cents - based on what you have (nothing particularly rare or valuable as far as I can tell), my opinion is to make a good inventory and then not worry about it.  Just enjoy running your trains.

Curious for my own future plans.  How do we know when our last illness is approaching?

What, me worry?

Mike

Ask yourself if the loss of your trains would significantly affect your live style or happiness, then decide if the cost of insuring the trains is worth while.

Charlie

And also keep in mind that if something does happen you get money. Then you have to go try to find the same pieces or new ones. But the point is the trains won’t be YOUR trains. It will be new trains and maybe different trains. That might figure into the equation.

I have a small collection compared to some of the guys on the list, my feelings is that if I were to loose them due to a catastrophic problem (storm, fire other things) it will hurt for a short time but I'll just keep on going, they are material things and I can't take them when I go and if I still have them when I go, it will be my family who has to deal with it, I won't care any more.

I had a good friend who was an insurance agent, he passed several years ago but we were talking about it and he told me that unless I had a really huge collection of expensive locomotives, and they were of the rare type or very collectible type, not to waste my money.  I took his advice and never purchased any additional insurance for my trains.

I would say to do whatever makes you feel more comfortable about your collection.  Best of luck.

IMHO, you're better off to spend the money on a self-installed alarm system with motion camera detectors and security lights, which will also protect other assets in your home besides trains.

I increased my personal property/possessions as part of my home owners policy.  My home owners policy came standard with 50% of the house value for covering personal property/contents/possessions.  I then increased that amount by X amount to cover the value of my collection. This was relatively low amount of added premium costs.  I did need an inventory list of some sort for verification.  However, my agent said just keep the list in a safe place, he had no need to have a copy or have my collection appraised.

I also have a rather large woodworking shop.  Did the same for that.

Talk with your agent.  He/she should be able to give you options.  Having a special rider is expensive for itemized items.  They have these for expensive jewelry, etc.

Talking with your agent is a good start, but get whatever he/she says in writing.  The agent is not a claims adjuster, but their word can bind the company (or give you reason to make a claim on their errors and omissions insurance). 

In addition to making sure you're within your policy's coverage limit, the critical piece of information will be whether your trains are considered to be normal contents (such as toys) or fine art / collectables, which are subject to lower limits on your policy.  Due to increased losses in recent years, insurance companies are getting much more strict (and stingy) with their claims. 

@Mallard4468 posted:

..the critical piece of information will be whether your trains are considered to be normal contents (such as toys) or fine art / collectables...

All of my trains are toys, and everything can be readily replaced with something darn close in current or recent production.

I would spend the money where it can do the most good......on more trains!

As my dad used to say, "All insurance is good until the first time you have to use it."  Don't waste your money on it.

I've had USAA insurance for almost 50 years.  I checked with them last year in reference to my trains, and they said that my homeowner's policy did not cover collectibles.  They referred me to American Collectors Insurance to purchase a policy that covers the trains.  (The ACI policy shows up on my USAA web page, but I pay the fees to ACI and not USAA.  I do not know whether USAA members get a discount.)

@Mike H Mottler posted:

I'm considering adding coverage to my homeowners insurance policy to cover my modest O-gauge train collection: six train sets, four THOMAS train sets, three trolleys, 12 operating accessories,  11 O42 RC switches, 16 RR structures, 35 DEPT 56 porcelain buildings,18 scale autos -- all placed on a 15 x19 feet L-shaped layout. Several pics attached for reference.

My insurance agent asked for an inventory list with prices as a basis for preparing a quote. However, I didn't make an inventory list of the train stuff - just the DEPT 56 items.  I'm reluctant to spend the time and energy to create that inventory list if the cost/benefit ratio of insurance isn't worth it.

Meanwhile, I'm 83 years old and will probably dispose of the entire collection via an auction house anyway -- before my last illness approaches (to spare my widow that chore).

Candid comments welcome.

Mike Mottler    LCCA 12394
mottlermike10@gmail.com

Over ten years ago we had a total loss/fire. Most of my 50+ years of trains went up in smoke. We had an Allstate policy that at the time was their A+. It basically covered everything. When the agent who covered the interior arrived she asked if I had photos ( I did) then asked me to look up in the Greenberg Lionel book prices. They covered my complete loss.

I’ve been with USAA for years and have used the recommended ACI coverage as well.  The rate is quite reasonable

@700E posted:

...they said that my homeowner's policy did not cover collectibles...

I guess if you call them "collectibles"(a pretty loose term, some people collect vacuum cleaners, Crescent wrenches, washing machines) , they are not covered. I don't have collectibles, just toys.

@ADCX Rob posted:

I guess if you call them "collectibles"(a pretty loose term, some people collect vacuum cleaners, Crescent wrenches, washing machines) , they are not covered. I don't have collectibles, just toys.

Collectibles is not a Loose term, it is clearly defined in one’s policy, you just need the time to read it.

@ADCX Rob posted:

All of my trains are toys, and everything can be readily replaced with something darn close in current or recent production.

@ThatGuy posted:

Collectibles is not a Loose term, it is clearly defined in one’s policy, you just need the time to read it.

What you or I call something doesn't matter.  What matters is what the adjuster calls it and how the policy defines it.

@Mallard4468 posted:

What you or I call something doesn't matter.  What matters is what the adjuster calls it and how the policy defines it.

At what point does a train set become a collectible for insurance purposes?

@ADCX Rob posted:

At what point does a train set become a collectible for insurance purposes?

The answer is in my post that you quoted.  Go round and round and bluster all you want. 

@Mallard4468 posted:

The answer is in my post that you quoted.  Go round and round and bluster all you want.

He likes to bluster a lot, and really say nothing. Truth is you need to read your policy speak to your agent and get the amount that you are comfortable with and can afford. It’s not rocket science. We are not going to the moon. We are not building Apollo

@Mallard4468 posted:

The answer is in my post that you quoted.  Go round and round and bluster all you want.

I am in a unique position then with my homeowners, there is no limit on trains, antiques, collectibles. I would urge everybody following this to check carefully the wording & limits on your policy - you may be buying extra insurance not needed, or not have insurance you do need.

@Mallard4468 posted:

The answer is in my post that you quoted.  Go round and round and bluster all you want.

@ThatGuy posted:

He likes to bluster a lot, and really say nothing. Truth is you need to read your policy speak to your agent and get the amount that you are comfortable with and can afford. It’s not rocket science. We are not going to the moon. We are not building Apollo

How does your policy define a "collectible?

@ADCX Rob posted:

I am in a unique position then with my homeowners, there is no limit on trains, antiques, collectibles. I would urge everybody following this to check carefully the wording & limits on your policy - you may be buying extra insurance not needed, or not have insurance you do need.

The page that you're displaying is irrelevant to this discussion.  It does not show the policy's definition of the  various coverages - that's the critical piece of information.  There are hundreds, if not thousands, of different homeowners policies available.  What matters is what a person's policy says at the time of a claim and what kind of trains they own.  Every situation is different, and you're clearly not an expert in this field.

I never made a blanket suggestion that everyone should pay for extra insurance on their trains.  However, it's prudent for each person to know what their policy covers and match that with their particular inventory of trains and personal tolerance for risk.  There is no "one size fits all" answer. 

@Mallard4468 posted:

The page that you're displaying is irrelevant to this discussion.

It's just the summary. Here is the policy... with the same information...  no limit on trains, antiques, collectibles.

How does your policy define a "collectible?

I'm in the insurance industry.  I've worked as a claims adjuster for years as well as an underwriter and many other roles.

Get advice from your insurance broker/agent.  Here is an excerpt of one insurance wording (and yes, one has to consult their insurance wording - it is the contract).  The first section speaks to a $5,000 coverage limitation, the second section speaks to Actual Cash Value (not Replacement Cost)

'
$ 5,000 in all for collectibles, such as sports cards, sports memorabilia and comic books.

Property Subject to Actual Cash Value Settlements:
We will only pay the Actual Cash Value for loss or damage to these nine types of property:
1) a belonging that is not in good, useable condition at the time of loss.
2) a belonging not in current use by you at the time of loss that you stored away and for which you had no specific future use.
3) a belonging of an age or condition that makes it out of date or no longer usable for its original purpose.
4) art works, antiques, rare objects, and other items that cannot be replaced. *****
'

Based on the above there are two items to address:
1: are trains 'collectibles'?  Based on the above wording/definition I suggest they are not.
2. ***** are they antiques, rare objects and other items that cannot be replaced?   Perhaps?? and if so, they are subject to Actual Cash Value.   Are they - 'art works'?  Maybe! 🤣

Generally, if you can replace your train items new for old, with ones of like kind/quality, the insurer will provide Replacement Cost coverage subject to the insurance policy wording. 

While my train collection isn't vast, I do have some nice pieces.  Based on my home insurance wording, I do not have specific coverage for my trains.  In the event of a loss I'll look to my home insurance policy to look after me.

If anyone has had poor insurance claims experience it is regrettable.  Insurers look for ways to pay claims, not deny them.  If they denied all claims and consistently provided lousy service no one would buy their product.

From this insurance 'nerd'.  Great discussion! 

-Richard

RichardVB writes:

“If anyone has had poor insurance claims experience it is regrettable.  Insurers look for ways to pay claims, not deny them.  If they denied all claims and consistently provided lousy service no one would buy their product.”

Almost spit out my coffee. The above statement is pure fantasy. Not my experience in any way, shape or form after Sandy. And thousands of homeowners experienced the same.

Insurance companies are in the business to make money which doesn't happen if they pay out for claims. It is a product that is sold as the result of collusion with mortgage lenders (homeowner's insurance), with state governments (auto insurance), or by peddling fear under the guise of caring and concern. Now I need to get a fresh cup of coffee perhaps fortified with a little bourbon. As I said earlier, don't waste your money on it (with VERY few exceptions, ie. a collection of 6 or more pristine pre-war Hudsons, a few perfect and rare State Sets, etc.).

@RichardVB posted:

I'm in the insurance industry.  I've worked as a claims adjuster for years as well as an underwriter and many other roles...

...Based on the above there are two items to address:
1: are trains 'collectibles'?  Based on the above wording/definition I suggest they are not.
2. ***** are they antiques, rare objects and other items that cannot be replaced?   Perhaps?? and if so, they are subject to Actual Cash Value.   Are they - 'art works'?  Maybe!...

..Based on my home insurance wording, I do not have specific coverage for my trains.  In the event of a loss I'll look to my home insurance policy to look after me.

If anyone has had poor insurance claims experience it is regrettable.  Insurers look for ways to pay claims, not deny them.  If they denied all claims and consistently provided lousy service no one would buy their product.

This has been my experience as well on coverage and claims payouts(I deal exclusively with mutual companies - one of them is USAA), thanks for the professional insight. My policy linked above does not have a limitation on collectibles as a category, so yes, your advice is sound... I would urge everybody following this to check carefully the wording & limits on your policy - you may be buying extra insurance not needed, or not have insurance you do need.

ADCX Rob writes:

“This has been my experience as well on coverage and claims payouts(I deal exclusively with mutual companies - one of them is USAA), thanks for the professional insight.”

Please provide some examples. Thanks.

@Mark V. Spadaro posted:

Please provide some examples. Thanks.

Car claims and one tractor fire, no train claims if that's what you're interested in. The tractor was with a local mutual company, I ordered a new tractor the same day, right after the fire... sent the invoice and pictures, they sent a check less the deductible after a 5 minute conversation with the adjuster over the phone.

@Mallard4468 posted:

Here's a fairly exhaustive (and exhausting) thread from about a year ago.

https://ogrforum.com/...0#161067874940613760

My 2 cents - based on what you have (nothing particularly rare or valuable as far as I can tell), my opinion is to make a good inventory and then not worry about it.  Just enjoy running your trains.

Mallard4468

Thanks for suggesting that previous thread. I read it for "deep background."  Very helpful.

Mike Mottler   LCCA 12394

@Alfred E Neuman posted:

Curious for my own future plans.  How do we know when our last illness is approaching?

What, me worry?

Alfred E Neuman

"The last illness" is when a doctor asks about your insurance coverage BEFORE asking questions about your symptoms.

Mike Mottler   LCCA 12394

@J. Motts posted:

I have a small collection compared to some of the guys on the list, my feelings is that if I were to loose them due to a catastrophic problem (storm, fire other things) it will hurt for a short time but I'll just keep on going, they are material things and I can't take them when I go and if I still have them when I go, it will be my family who has to deal with it, I won't care any more.

I had a good friend who was an insurance agent, he passed several years ago but we were talking about it and he told me that unless I had a really huge collection of expensive locomotives, and they were of the rare type or very collectible type, not to waste my money.  I took his advice and never purchased any additional insurance for my trains.

I would say to do whatever makes you feel more comfortable about your collection.  Best of luck.

J.  Motts

After "sleeping on it" for a couple nights, I decided to forego insurance. My collection is modest but meaningful. None of the items are vintage collectibles; mostly modern era items that are replaceable.  In event of a loss, I'd lament the loss but would carry on without replacing one or two items. If a total loss, I'd reflect on the quality time spent over years of ownership.

Mike Mottler   LCCA 12394

Thanks to all who contributed to this thread.  I have told my home insurance agent (Farmers Insurance) that I'll pass on train collection insurance.

Candidly, the greatest risk of loss in my area (central Arkansas) is a tornado. We have lived here for 40 years without facing "a big one." However, if one damages or it destroys our house, my modest train collection would be considered a mere fraction of the loss.  Thankfully, I have retirement savings and investment accounts, so I could replace the trains with funds from those accounts if I wanted/needed to.

I've already enjoyed the use of my trains with my great grandkids for years, so I'd consider that as sufficient "reimbursement" for the loss.

Mike Mottler   LCCA 12394

@ADCX Rob posted:

It's just the summary. Here is the policy... with the same information...  no limit on trains, antiques, collectibles.

How does your policy define a "collectible?

But your policy does have a hovercraft exclusion so watch out for that.

I have a more than modest collection and in my opinion insurance is an essential.  Less than 1/2% of my collection's value.  I'm with ACI and they cover the 3 places (home, club, storage unit) that my trains are located in.    And it's easy and substantially cheaper than what was offered through the TCA when I took it out.  Only had to supply pictures and schedule items worth more than $2500 (a whopping two!)  Hopefully I'll never need to see how smoothly ACI pays out a claim. 

And auto insurance is collusion with government?  I always thought it was to protect you against a catastrophic accident.  Learn something new every day!

@Bill DeBrooke posted:

I would spend the money where it can do the most good......on more trains!

I was thinking the same thing. LOL