In the Aug 2005 MR issue on page 28 is an AD for Insurance For Trains.
I have no idea how much my collection is worth, and have never taken a full inventory of all the stuff. I guess photos of all the stuff would help in this case.
Questions:
Do you think that normal homeowners insurance would cover a train collection?
Does anyone have a special rider or have taken out special insurance for their home train collection?
Thanks,
Ryan
I recently bought renters insurance. there is a place in my policy for any collectibles. I told my agent that I had over $5,000 worth of trains and they told me to make a log of everything I thought was valuable and file it with my ins. company. That was State Farm, maybe others are different.
Review this as a comparison.
http://www.nmra.org/model_collection_insurance.html
Small numbers of items, no one of them especially significant or costly to replace, would normally fall under your general policy. However, once you get items of a certain type or nature costing over, say, $2K to replace, they would probably want an itemized list. Certainly, if you had an especially rare item that would cost several thousands of dollars to replace, that one item would need a rider…most likely.
Best thing to do is call your insurer and ask them. It might cost another $20-$100/year, depending on how much you say the replacement cost would be…
“Normal” homeowners insurance does not cover collections. If you have a significant collection, your insurance agent is going to want a detailed inventory and you’ll have to pay extra for coverage.
Normal homeowners insurance will cover your trains like anything else in the house. The problem is that they are going to take the original cost, and then calculate the age to come up with a reduced figure. And then take off the ‘deductable’. The problem with many collections that they increase in value over the years. Most homeowners policies have a ‘rider’ you can attach that will cover your collection. You will need to have an inventory of the items, the ‘value’ of them, and in some cases pictures. The cost of the ‘rider’ will be based on the value you assign to the items.
Be aware that the NMRA has an insurance plan available as well:
http://www.nmra.org/model_collection_insurance.html
Jim Bernier
Now before any loss is the time to talk to your agent , take pictures and put together an inventory. After a theft , fire, or some other disaster, there is enough to deal with without having no coverage on the things that you value.
Will
I too have struggled with this issue but when I weigh the risk vs the cost of insurance, I take the chance that nothing will happen.
I like my trains but they are just “things” and if they’re lost in a fire or other disaster, I think I’ll have bigger problems than just replacing them. Replacing them is the key from my perspective, as coverage for “replacement value” will really be costly.
Remember an insurer is making a bet with you that they won’t have to pay back any of the money they’ve collected from you.
I have coverage on the major stuff but the trains just have to live out there in the land of risk.
Dale
I would think that you might want to require what exactly the insurance will pay for…value (which I’m guessing would be a function of purchase price) or replacement cost. With the increase of limited runs, this difference might be important. While we all think of fire and disaster, theft is another criteria to think about. The local LHS owner had his house broken into and several RC planes stolen. Luckily the police caught the guys and the planes weren’t damaged (get this - the thiefs showed up at his LHS and wanted to sell them to him!!).
Theft??? Really the only hazard to most model railroaders train’s, is fire (or water). Trains are not a priority item for most thieves. Guns, jewelry, cash, drugs, and maybe a few pieces of electronics are what burglers are after. I have none of those items.
The replacement cost of my trains is probably over $50,000, but the quantity of pieces is so large, and the individual piece value is so low, I dare anyone to try and steal it. Anyone dumb enough to try, deserves the hernia they would most certainly get in the process.[:0][:p]
I don’t have special insurance for my trains, it is a waste of money. If I was to lose everything in a fire, most of the stuff wouldn’t be replaced anyway, and the coverage on the household contents is more than enough.
A brass or vintage train collection would be about the only things worth insuring seperately.
Keep in mind, for most of us this is a hobby. We don’t do it as an investment, we do it because we enjoy it. Nobody will sell you insurance that will cover the cost to have a layout rebuilt, unless you had it built professionally and have a record of the purchase price.
DUUUUUHHHH![D)]
Thanks for all the comments!
At this point I have no intention of getting a separate rider or train collection or layout insurance. I would not even know how to value some of my stuff, a lot of my rolling stock and locos date back to the 70’s. Where do you get valuations for this kind of stuff?
I just thought it was interesting to see that advertisement in the Aug. MR issue and wondered if anyone out there in the forum actually bought this kind of insurance for their layout or collection. And also wondered if those who have bought it feel like it is working for them.
Thanks again,
Ryan
Ryan, used trains are like used cars. With the exception of a few models, they depreciate. The place to check values would be at your local train flea market, or on eBay.
I too would be curious to hear from anyone who has purchased such insurance and had a claim.
I collect Diecast cars and have around 700 in my collection. I do have collector insurance because my Insurance agent told me that with such a large collection my policy doesn’t cover it. The policy is for the Insurance company’s protection as well as yourselves. If I did have a fire and the house was leveled then who is really to say I had what I say I had? Contents insurance does not cover collections, it does cover for example one Franklin Mint car but not 200 of them. Anybody who feels that their home insurance is going to cover their collection will be in for a rude awakening if something happens. I pay an extra 100 bucks a year to have 45000 bucks of replacement value insurance on my collection. Every car is photographed and when I do buy something new I add it to the appraisal sheet and its updated every year by the insurance company. Its a small price to pay for having piece of mind knowing that my collection is covered. Would you drive your brand new 45000 dollar car with no insurance? Then why wouldn’t you insure your collection? Elliot, I did make one claim. My wife was babysitting a friend of hers young boy and he decided that two of my Franklin Mint cars were just to nice to just look at in the display cabinet and proceded to have a little game of smash up derby. He scratched them up and broke off the antenna’s, mirrors and one door. It wasn’t his fault, he thought they were toys and I couldn’t yell at his mom because it was my wifes fault for not watching him. Actually it was nobody’s fault, you can’t stare at a kid 24 hours a day just to make sure he is good. I phoned up the insurance company and told them what had happened and he laughed, looked up the cars on my file, asked if they were still available and told me the check will be in the mail. I did have to give them the 2 cars that were damaged, he keeps them in his office and shows home insurance buyers what could happen to their collection and why it is a good idea to have collector insurance. I could have been out 35
TA462 is right. While this topic is raging it would be a good time to call your agent and see if your homeowners or renters insurance includes “Replacement Cost” or “ACV”(actual cash value) on contents. Replacement cost is just what is says, ACV is depreciated value. Some agents who value the sale more than the client will quote ACV coverage on contents to make their quote cheaper than the quote from the responsible agent who quotes replacement cost. The laws on this vary from state to state and the language in the policy varys between companies. If you bought your policy from Mr. Cheap you may just have ACV coverage on that plasma TV in the living room. When your turn to have a claim comes you’ll be VERY unhappy. If you don’t have a local agent, but bought from one of those 800 number companies, by all means call them and FIND OUT if you have ACV or replacement cost. More than your model railroad stuff is at risk here. How do I know? Check my profile.
Ed
I think normal homeowners insurance would cover it (you may want to increase your content value for the trains though), but if there is a lot of completed work and inventory / product, I think that to be safe I would take a lot of photos, a complete description and written inventory, perhaps a collection or list of receipts, and file all of that with a separate rider on your policy. That way if there is an (unfortunate) claim you can be confident that even a non-MRR insurance agent can appreciate the value of your railroad. AND they would have the info to back up your claims.
-separate insurance policy riders frequently cover antiques, china, equipment, collections, wine collections etc, so why not your train ?
Dave Hughes,
Ouch!!!
I guess knowing you had them insured made it easier to handle too! I really enjoyed reading your story. I need to take inventory just to see what all I have first and then assign values to them. Thanks for the info.
Ed,
Your explanation really puts an informed analysis on the business of insurance. Thanks for defining the difference between “Replacement Cost” or “ACV”(actual cash value) on contents. And especially since you are a pro at this I really appreciate your input on the topic. No time better than the present to take inventory. Thanks again!
Krump,
At this time I think my homeowners would cover the collection because I just don’t have a lot of expensive items, but I will re-evaluate the situation after taking inventory.
I have home insurance through American Express. Their policy does not cover hobby collections. So I just got my layout insured through the NMRA insurance program. I thought it was pretty inexpensive.
I have set up an Excel spread sheet to inventory my MRR stuff. Over the last several years, I’ve listed darn near everything I have. I was astonished to find I had almost $17,000 in stuff, without any brass. Life Like, Atlas and Bachmann plastic locos, a bunch of plastic car and building kits, videos, DCC stuff, etc. sure add up.
SilverSpike, its funny now but at the time I didn’t know what to do. I think I just held in my anger, lol. The kid still comes over but believe me he stays away from the cars, lol. It was just an accident anyways and I did replace the two that were damaged so it turned out to be a learning experience.
Dave, I think there is a clear line being established here as to what needs seperate insurance and what does not. In the case of your car collection, I think the term “investment grade” applies. You buy them to display them because you like them, but deep down you hope that their value increases. They are not to be played with, and are not “toys” (for lack of a better term).
You suffered a loss, and filed a claim for $350. You said earlier that your annual premium was $100. At that rate, if you had your policy for 4 years, and if they paid the claim in full, the company has made a good bet so far, because they are still $50 ahead based on the guess of a 4 year term.
In the past, here on the forum, we have discussed the collectability of HO and N scale trains, and have pretty much concluded that, with the exception of brass and some of the older pieces, they are not collectable. Regardless of what you paid for it, most of it replacable at pennies on the dollar in used condition.
Sentimental value is a different story. Just think of all the photo albums and one of a kind items that have ever been lost in fires or natural disasters. They are gone forever, and with little or no compensation. That is what a layout is, with all of it’s buildings, scenery, and wiring.
When you tear down a layout to move, you salvage what you can, mostly structures and trains. The rest is trash, no matter how many hours went into it’s creation. I think the best you can hope for is a fraction of the raw material cost.
On the other hand, I have some friends who collect Lionel trains. The basement of their tiny home is like a museum. The value of their trains far exceedes the value of the structure and the rest of it’s contents. They have insurance, and rightfully so, but then they aren’t in what I would consider the norm for this forum’s audience.
I think it would be safe to say that 90% of the magazine’s audience are not candidates for this kind of special cov