Valuation for insurance purposes

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Old.Professor - 02 Jul 2008 18:48 GMT

I am looking into insurance. In order to determine how much my State
Farm homeowners covers and whether I should buy additional insurance
from the NMRA program, I need to value what I want insured. Checking
on the NMRA insurance, I found the following:

A. Blanket Coverage
*Limit $ x .0075 = $ Blanket Coverage Premium
B. Inventory Coverage Please Submit Schedule
*Limit $ x .0060 = $ Inventory Coverage Premium
C. Layout Coverage (Excluding rolling stock)
*Limit $ x .0060 = $ Layout Coverage Premium
A+B+C ($100 Minimum) $ + $10.00 NMRA Fee = $ Total Premium
and NMRA Fee

Q. How much coverage will the $100 minimum premium buy?
A. For "Blanket Coverage": $13,333; or "Inventory Coverage": $16,666;
or "Layout Coverage": $16,666. If you buy a combination of coverages,
these figures will vary based upon the values placed under each item.

Since I have my rolling stock in RailOP, I can use that to estimate
value. Then I can go back to the State Farm agent to see if it is
covered. But I don't know how to value the layout. I wonder if
custom builders have an average price per sq ft or equivalent that
could be used. Any ideas?

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Wolf Kirchmeir - 04 Jul 2008 04:51 GMT

> I am looking into insurance. In order to determine how much my State
> Farm homeowners covers and whether I should buy additional insurance
[quoted text clipped - 20 lines]
> custom builders have an average price per sq ft or equivalent that
> could be used. Any ideas?

AFAIK, J A Bash is the broker/insurer, so I would get in touch with them
directly for advice on how to establish insurable values. Phone
800-654-2256, or go to http://www.jabash.com.
Good luck!

Footnote:
There are two ways of valuing your layout:
a) replacement value
b) market value.

Generally speaking, artworks and collectibles are insured for market
value, which may increase over time. However, railroad models (apart
from a few well publicised objects) generally do not appreciate in value.

Sale value for most scale model items, regardless of scale, varies from
zero to about 50% of original purchase price. Most run around 10-30% of
original price. There are exceptions, but they don't make up for the
really serious hit you take when you try to sell your treasures. Keep in
mind, also, that if a manufacturer has guessed wrong on the demand and
over-produced, a large part of the production run will be sold off at
very deep discounts, and these discounted prices will be the base that
determines the resale value.

OTOH, replacement value may be higher than original cost, since prices
of many models have increased, and a reasonable cost for labour would be
included.

HTH

Signature

wolf k.

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Model Forum / General / Railroads / July 2008

Valuation for insurance purposes