If your home floods, would your art, antiques or collectibles be in danger of suffering water damage? Do you believe your homeowners insurance will cover it? You had better make sure.
A little more than a year ago, on Oct. 29, Hurricane Sandy pounded the entire U.S. eastern seaboard from Florida to Maine, with particularly severe damage in New Jersey and New York, flooding streets, tunnels and subway lines and cutting power in and around the New York City. But the damage was not limited to cities on the coast. Sandy’s destructive force was felt across the Appalachian Mountains and as far west as Michigan and Wisconsin.
In all, Sandy affected 24 states, causing some $65 billion in damage, and the storm’s caprice reminded Americans that despite modern technology, contemporary building code and practices and the latest in emergency preparedness, a hurricane’s ferocity can still surprise us. Residents who never thought they’d become a victim of hurricane damage watched helplessly as their homes were knocked down and their possessions were swept away. Collectors despaired as water, wind and fire ruined their cherished treasures.
Many are still struggling to recover from that massive storm. Even those who weren’t affected last year should learn some valuable lessons from what happened. What is important must be protected, and if you don’t have the proper coverage for your home and your valuables, you could lose a lot after a storm—or even a fire or burglary.
If you trust the protection of your high value collection to the contents coverage offered under your home insurance policy, you might be exposing it to unexpected dangers. Personal possessions in your home are covered under your homeowners insurance policy, but many high-value items face strict limits. For example, the maximum payout for collectibles can sometimes be as low as $200. Review your policy to see the specific limits for your collectibles.
To raise your home insurance policy’s limits for high-value items, you can schedule an endorsement on your existing policy. An endorsement on your home policy would increase the limits up to the full stated value of your collection. However, you will need to provide proof of ownership and an appraisal to your insurer.
One caveat: An endorsement, like standard home insurance, typically will not protect your collection in case of flood damage.
However, another option for coverage could give you help in that regard. A personal articles floater is a separate policy typically purchased through a carrier that specializes in insuring high value items such as collections.
Though floaters may cost more than other options, they have numerous advantages. For one, these policies protect from all perils, including flood and earthquake damage (which aren’t covered by home insurance). In addition, floaters often have no deductibles.
There’s also an advantage to having specialized protection. Experts can give you advice on how to best secure your collection from common disasters, such as smoke and water damage. They will use a professional appraisal to set appropriate coverage limits. A standard personal articles floater also offers more extensive coverage, such as protection for items in transit, stored away from the home, or newly acquired items. If your collectibles are on display or at an exposition, for example, they’re still covered.
Do you have an inventory of your collection? If not, you could be setting yourself up for further loss. It can be difficult to remember important details such as purchase date in the aftermath of a disaster, especially for specialized collectible items.
To create an inventory, record each item’s description, size, purchase date and price, current value, the name and location of the seller, and take a photo. Keep your inventory in a safe place with at least one copy outside of your home. An inventory also can help you when it comes time to get an appraisal done.
Many victims of Hurricane Sandy didn’t foresee the breadth of destruction that the storm would cause. The U.S. suffers from many different types of disasters, from hurricanes to tornadoes to wildfires and more. Make sure your collection is insured so that you don’t have to worry about losing your valuables to a natural disaster.
Katherine Wood is a contributing writer for the Homeowners Insurance blog. HomeownersInsurance.com serves as a resource center for insurance consumers and home buyers across the country.
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