King of Collectibles: What Insurance Agents Should Know

“We sell the most interesting things in the world from all categories — sports, entertainment, comics, rock and roll, movies — and we also deal with an incredible cross-section of celebrities, athletes, serious collectors as well as individuals who may find that one thing that’s going to change their life. Literally, within the first 60 seconds of the show, you will see a $15 million item in my hands.” – Ken Goldin from King of Collectibles: The Goldin Touch

Imagine opening a briefcase and seeing an envelope and a single sheet of paper with the slightest hint of creases and folds. The ink, although legible, is faded and the signatures look rather unimportant — at first glance. Now imagine that this handwritten letter and envelope are sold at auction for over $400,000. Scripted show or reality? Turns out, this event is entirely true because the handwriting on both items is that of George “Babe” Ruth, and his signature appears six times. 

Suspenseful. Thrilling. Risky. With the right amount of luck, the collector may be able to cash in millions of dollars from a rare find. That’s the heart of the collectibles business, and its ability to yield skyrocketing profits may be why the collectibles industry is growing in popularity. North America, in particular, holds the greatest market share for collectibles worldwide. 

Cut to a Netflix series that has taken audiences by storm. King of Collectibles: The Goldin Touch follows Ken Goldin, the founder of Goldin Auctions, as he meets with a wide range of collectors. Ken’s goal? To convince the collector to part with the item, so that they can raise the stakes at the auction and reap the highest monetary value possible. That’s the mission of every episode, and insurance agents and collectors alike may relate to many of the themes presented in this streaming series. 

There’s a sense of adventurism attached to the collectibles business, and MiniCo recognizes that spirit in the Collectibles program motto: “If they collect it, we’ll cover it.” While the majority of our policyholders specialize in one of about 30 standard collectibles categories, there are hundreds more eligible for coverage under MiniCo’s program (be sure to check the website for details and exclusions). We offer limits up to $1 million through the program, but collections valued up to $4 million may be accepted by our carrier partner. 

Going back to our example of the original Babe Ruth contract selling for a million dollars, imagine this treasure sitting proudly in a display case in the home of an avid sports memorabilia collector. What would happen to the item’s value if it were damaged by water during a severe storm? What if the contract went missing after a social event held at the residence?

The potential for damage to or loss of valuable property is what insurance was created to address. But when it comes to purchasing insurance, many people overlook collectibles insurance in favor of a generic solution: a homeowner’s policy. As their agent, you can advise clients about the benefits of purchasing specialized collectibles insurance.  

One of the most important differences between a homeowner’s policy and a collectibles insurance policy is the valuation of covered items. Collectibles insurance takes into account that the covered items may appreciate in value. That’s in stark contrast to a homeowner’s policy that insures items for their actual cash value. A used sheet of paper has little actual cash value, but a letter handwritten by Babe Ruth is worth nearly half a million dollars!

Another important benefit is the types of perils covered by a policy. Homeowner’s policies generally only cover named perils and exclude coverage for items in transit. By contrast, collectibles insurance policies (including MiniCo’s program) may include all-risk coverage and provide coverage for items in transit, items stored away from the home (such as in a storage facility) and accidental breakage. If the owner takes items to collectors’ shows, a specialized collectibles insurance policy would likely provide coverage for the items in transit and during an event as long as the insured maintains care, custody, and control.

Something else to consider: homeowner’s policies rarely offer low-deductible policies (and charge higher premiums when they do so). Low- and no-deductible policies are the standard for collectibles insurance. A zero-dollar or low-deductible option can make a big difference to a policyholder in the event of a claim for damage to or loss of a valuable collectible.

Serious collectors invest more than money when it comes to curating their collections. Educating your clients about the benefits of insuring the treasures they love with a dedicated collectibles insurance policy is a wise move in terms of risk management, financial protection, and customer service.

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