Program

A leisure-time, fun hobby can quickly grow into a meaningful collection. Like other aspects of owning a collection - acquiring new items, displaying, etc. - security and insurance need to become a prime consideration. Both security and insurance coverage are critical for your collection.

A prerequisite, particularly for your insurance needs, is developing and following a good inventory management system.

Documenting Your Inventory

For any collection with a value of over $5-10,000, your inventory should be documented. This can serve multi-purposes. It provides a history of your collection and a management tool. It allows you to know exactly what items you have in your collection and what you paid for them. Although this may not be important in early stages, as your collection grows you may find it a valuable tool to let you know specifically whether or not you have a particular collectible without relying on memory. Obviously a documented inventory is important for insurance purposes.

What information you record in your documentation may differ somewhat from one collecting area to another but here are some areas from which to choose to suit your personal needs:

Item name, usually a 2-5 word identification
Item number if you are using a personal cataloging system
Date purchased
Your cost. Keep receipts.
Source of purchase, e.g. name of auction house, catalog auction, Internet, antique show, shop or mall, flea market, estate sale, yard sale, private individual.
Description of item including size/dimensions. Describe any noticeable defects. This is important in providing a description in cases of theft.
Manufacturer's name
Special markings, such as an artist's signature, autographed copy, markings on porcelain and glass
Edition limit and item number
Year of issue
Location of item, e.g. living room, locked display case, home safe, safety deposit box. This information may or may not be a good idea depending upon the nature of the collection.
Current market value. If you are the type of collector who keep up on current market trends by reviewing auction results, sales catalogs, collecting publications, price guides and visits to shows and shops, you may like to keep a running account of what the same item as one in your collection is currently selling for. Keep auction catalogs, price guides and news clippings to prove what comparable items have sold for or are selling for now. This is particularly important for collections as they mature and include many items purchased 20, 30 or 40 years ago.

Record each item at the time you acquire it. This can become a self-regulating management system, done weekly, monthly or whatever works for you. This also depends a lot on your acquisition volume. If you purchase one or two items a month for your collection, your routine would be different than if you buy several items a week.

Take a lot of pictures. The old adage that a picture is worth a thousand words certainly rings true in showing off your collection. Photos of individual items are good and easy to classify and with digital photography, this is a good procedure to work into your documentation process. If your collection is "out on display" in a study or family room, borrow or rent a video camera for a day and simply walk through your collection doing a "show and tell" by picking up key pieces, identifying them, showing them off, and telling a little about each one. This is a relatively easy way to document a general "feel" for your collection in an overall approach.

Claims adjusters (who help settle an insurance claim in case of a loss) are out to save their company money, not give the collector full value for the collection. Adjusters also seldom know much about appreciating property, i.e. antiques and collectibles. So, the more documentation you have as to the identity and value of what was lost, the better your chances of getting fair indemnification.

One of the most important points to stress with inventory documentation is so basic it often doesn't get mentioned. Never keep your inventory documentation and your inventory in the same location. If, unfortunately, you suffer a loss from fire or flood, for example, the documentation gets wiped out along with the inventory. Result: No records. If you desire to have your documentation handy as you work on your collection, then keep two sets of the documentation - one with the collection and one at an entirely different location, perhaps in a safe deposit box, or at your office or a relative's house.

There are some excellent software management tools on the market for collectors. Again, these are all somewhat different from one another and you need to check out several before deciding which one is best for you.

Do I need to have my Collection Appraised?

Collectors who wish to insure their collection, or a part of their collection, must first ask themselves how they are going to determine its value. Basically, two methods are available: replacement value or fair market value.

Most collectors want to insure for current replacement value. Replacement value is the stated amount that it would take to replace the items if they were damaged, stolen or lost. Fair market value is the value of the collection if it were to be sold suddenly at auction or through any other willing seller/willing buyer arrangement.

The fair market value is usually used for reports to the Internal Revenue Service when a collection is donated to a museum or charity. However, some collectors may feel that if their collection was completely lost, current fair market value would make the most sense where a cash settlement by the insurance company was concerned. One candidate for fair market value coverage would be the collector of advanced years who may not see the necessity of continuing the collection after some loss.

So, back to the original question, "Do I need to have my collection appraised?" If you are planning on using an existing policy, check with your insurance agent to see over what value and items must be professionally appraised. Appraisals are expensive, and many collectors know more than the appraiser. So use a professional appraiser only if necessary. Otherwise, if you have done a good job of documenting your collection yourself, this may be enough. Collectors need to do two things in case of loss: a. prove they owned it and b. prove what it was worth.

Particularly for collections where documentation and records are not available, or for major value collections, an appraiser can play a significant role. An appraiser is a person who determines the value of an item or items for insurance purposes and can supply the necessary information for the settlement of damage claims. The professional appraiser also is the person who can determine the value of a collection at the time it is donated to a tax exemption institution or charity. Appraising is not a casual matter. All professional appraisers must be accurate and precise and should be updated annually to reflect market changes. If litigation arises from a dispute over valuation of property, an appraisal must withstand the scrutiny of a court case. Therefore, select an appraiser carefully, not unlike how you would go about selecting an attorney or family physician. Ask for credentials and documentation for the type of experience the individual has acquired. Be careful not to rely solely upon a store owner's purporting to be an appraiser. It is also something wise to check with collector friends as to whom they trust and feel confident with for appraisal options. (Visit the appraisals program section on this website for more information.)

Collector Insurance. Why you need it.

First, most Homeowner Insurance Policies do NOT cover antiques and collectibles or have limited coverage. Some insurance companies will add scheduled coverage but the rates are high and they require an appraisal or require a list of every item which can be expensive and difficult to get. Also note, scheduled coverage is limited to the scheduled amount instead of replacement cost. If you find your homeowners policy does not provide adequate coverage for your collection, you have a couple of options. First, you can purchase a floater, which provides you with broader coverage. Or, you can purchase a stand-alone policy designed to protect valuable collections.

Only in relatively recent years has insurance become an important factor with collectors. In the past, many collectors didn't seem to feel they needed it, or more likely, just never thought about it.

A number of companies now offer insurance specifically for collections. Some collecting areas, through their collecting clubs or societies, offer members a collector insurance plan. There are a few insurance programs which are totally focused on the collector.

One of these is the plan offered by the National Association of Collectors - the NAC Insurance Plan. The NAC insurance rates are very competitive. No appraisals are required; only single items over $2500 need to be listed on the application. The NAC insurance is based on replacement cost coverage. You will be paid the current market retail value of the item at the time of loss. Truly "all-risk" coverage with hassle free claim settlement. Visit the NAC insurance page on this website for insurance rates and a policy application.

Home Security Systems

Until fairly recently, a fail-safe security system consisted of a good lock on the door. But more and more, homeowners - and even apartment dwellers - are investing in home security systems to deter criminals, provide home protection, and give them peace of mind.

If you live alone with little more than a television and some furniture, and have little concern for your own personal safety, then your home security needs may be nil. If, however, you have children and/or other family to protect, you fear for your own personal well-being, and/or you own expensive antiques or other collectibles which have value, then your need for home security is probably much greater. The importance of what you are trying to protect should weigh heavily in your decision to install a home security system. You want to be able to sleep well at night knowing that both your loved ones and your valuable personal belongings are safe. If you can't do that now, then you may need some form of home security system.

Another way to analyze your home security needs is to consider the likelihood that you will be the target of criminal activity. If you live in a neighborhood for a while, you probably already know whether it is safe to leave your doors unlocked at night, or whether you should barricade every window around the clock. If you live in a high-crime area, your need for home security is greater. If you are new in town, you might want to do a little research to find out about the level of crime where you live. the police station, local library, neighbors, and local real estate agents are all potential sources of information about the level of crime in your neighborhood. Use that information when making your decision.

Even if you live in a low-crime area, be aware that there are certain types of homes that are more prone to burglary than others. For example, ground-level apartments are more likely to be targeted than apartments three or more stories up. Homes surrounded by thick bushes, plants, and trees are favored by prowlers because they offer plenty of places to hide. Old, weak, or cracked doors and windows are easier to break into. A house on a darkened street where the owners are seldom home is a very attractive target. In contrast, if your house has a wide-open lawn on a well-lit street that is posted with "Neighborhood Watch" signs, it is probably not the ideal spot for a burglar to ply his or her trade. Does your home invite or deter crime? The answer will help you make a decision about whether you need a home security system.

Aside from safety, you may have a financial motive to beef up your home security. Most, if not all, insurers will give you a discount on your homeowners policy premium if you install a home security system. The available discount will vary from one insurer to another. It will also vary depending on what kind of security system you choose. Usually, insurers will give you a 5 percent discount merely for installing deadbolt locks. A simple burglar alarm is likely to get you yet another 5 percent. If you decide to go with a more sophisticated home security system, complete with monitoring services, then you can expect a discount of up to 20 percent. Check with your insurance agent to make sure you're currently receiving any discounts you qualify for, and see if you can save any more on premiums by installing additional security equipment.

The price of a security system depends largely upon how sophisticated the system is. A typical higher tech solution is a full-perimeter system, which usually includes a series of sensors that, when armed, detect when a door or window is opened, broken, or tampered with. These systems typically operate on the principal that whenever one of the detectors is tripped, an alarm of some sort will sound. It may be a horn, bell, or beep and may be accompanied by flashing lights. If the system includes off-site monitoring, local police will be notified. Additionally, there are a host of other systems that can protect you if an intruder bypasses your perimeter system and succeeds in entering your home. Floor sensors can detect an intruder by the weight of his or her footsteps. Motion detectors sense any significant movements within their range.

The technology that goes into many modern systems is truly amazing, and if cost is not an object, very sophisticated systems are available. But don't let money discourage you until you have shopped around. There are many security systems to choose from, in a wide range of prices. Whatever you are trying to protect, you should be able to find something within your budget that will help you sleep better at night. Consult your local yellow pages, the Internet, or community newspapers for security system professionals and dealers in your area.

Other Security Measures

There may be steps you can take to minimize your need for a high-tech home security system. If you want to make your home safer and can settle for low tech, there are a number of things you can do.

Install dead-bolt locks. Replace old, cracked, or hollow doors with doors made of metal or solid hard wood.
Don't rely on a slide chain to protect you if you are opening a door to see who's knocking. Install a wide-angle peephole device in the door.
Make sure your sliding glass doors have keyed locks and cannot be lifted out of their frames from the outside. An old broom handle or pole cut to the proper length and laid in the track of the door can prevent it from being slid open.
Install removable pins, nails and/or rods to prevent windows from being opened, and replace old or cracked windows and panes.
Where possible, cut back bushes and trees that surround your house and windows.
And, finally, try to create the illusion that you are well protected. Whether or not you have a home security system, purchase adhesive labels that say you do, and affix them to every door and window. Post a "Beware of Dog" sign, whether you have one or not. The illusion that you are well protected may deter a would-be burglar. If you are going to be away from your home, purchase several inexpensive timer that turn lamps on and off and position them in several rooms timed to go on and off at different times. Hopefully it will create the illusion that someone is at home and deter a burglar who is waiting to make his or her move when the home is vacant.

Safes and Security Boxes

As important as home security systems are, collectors who have valuable collections should also seriously consider a safe...and what kind of safe. Most safes are either made to be fireproof or burglary resistant. More expensive safes - usually $1,000 or more - provide protection for both, but if you plan on a less expensive safe, you must decide which type of protection is more important to you.

Other questions include: If you are looking for a safe to protect against fire, then how hot a fire? And how long will the fire burn? If from theft, consider whether you're protecting against an amateur thief or a professional burglar with high-tech tools. What type of collection is to be placed in the safe...high value property or emotionally irreplaceable items? All these decisions can help lead to what kind of safe you need and how much you should pay.

You can easily obtain an inexpensive safe from large discount stores - perhaps for less than $100. This type of safe probably is a `no-frills' model that may offer one-hour fire protection, but is not equipped with appropriate hardware to resist any severe burglar attacks.

Safes designed to protect against fire are usually lightweight, which allows them to be easily carried off." As far as burglar protection, the safe needs to be able to "resist attacks by pry bars, jack hammers, high-speed diamond drills, rotary saws, carbide discs, and perhaps, even explosives. Also, you will need special high security locks that resist drilling and manipulations.

According to Central Florida Safe & Lock Co. Inc., most burglars who menace residential areas are looking to quickly steal something that can be easily resold. Bear this in mind when you're considering the size and weight of prospective safes. Many burglars will simply carry away a safe without opening it, in the assumption that the safe contains something worth their while. Whether you decide to buy a heavy safe, it's wise to bolt safes to the floor for further security. Secure the bolts to floor beams for optimum results. (Another option is the in-floor safe, which, because it is surrounded by concrete, is generally well protected from theft and from fire.)

Underwriter Laboratories has established a standard of tests to be met by safe manufacturers to meet different levels and types of attack.

If you are looking to buy a burglar-resistant safe, keep an eye out for used safes. There are many old quality safes which can be purchased for a bargain price. "If it has a combination lock which still works, the door hinges are good and even if it has been previously penetrated and properly repaired, it is hard to go wrong," according to the Central Florida Safe & Lock Co. The only word of caution here is that these old safes were manufactured to defend against burglar attacks with tools known only when the safe was made, not today's state-of-the-art tools. Also, in the case of fire-proof safes, used safes are not as effective as newer ones. Fire safes derive their protection from walls composed of concrete. As older concrete dries out, the concrete loses its fire resistance.

A word of caution for both used and new safes - many safes' interiors collect moisture, and humidity can cause considerable damage to the objects stored in a safe. An easy way to help control the humidity of a safe's interior is to put some silica gel inside the safe. Chemically inert, nontoxic and noncorrosive, and above all, inexpensive, silica gel is useful in a variety of cases because it absorbs moisture from the air. Silica gel will absorb water until it becomes saturated. Then, it must be reconditioned (essentially dried out again). It has an indefinite shelf life and can be reused again and again. Saturated silica gel can be reconditioned by baking it in an oven for 12 hours at 250 degrees Fahrenheit.

Bank safety deposit boxes provide another good option for collectors, particularly those with collections of small items such as coins, tokens, stamps, paper, jewelry, political buttons, thimbles, etc. One of the obvious drawbacks of a bank safety deposit box is that you can't get to your collection or enjoy it as much as if it were right at home with you.

Another option, particularly from the standpoint of protection against theft, is to simply find an unobtrusive, unlabeled file cabinet drawer, or some "hiding place" within your house which a thief would probably pass over.

Obviously, since most people collect items to enjoy for themselves and, yes, to "show off" to friends and visitors from time to time, having them tucked away in a vault, safety deposit box or safe is not very conducive to having them on display. Locked, glass display cases, of which there are many, many designs and different types, remain a favorite way to `house' many collections. The only caution here since your collection is basically "out in the open" is to make sure your collection is insured. It is at risk.