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Safe Deposit Box Insurance
cinque1543
Posts: 646 ✭✭✭✭
I know this question has been asked before, but many of the posts on this topic are several years old, so I'd like to ask again. Does anyone have recent experience with companies that insure the contents of bank safe deposit boxes?
This site lists a number of insurance providers, but I'm hoping that member feedback on this forum will narrow down the choices a bit. Here are some of the providers.
ANA Plan with Risk Strategies (formerly Hugh Wood)
American Collectors Insurance (ACI)
Collectibles Insurance Services (CIS)
Chubb Group – Valuable Collections Insurance
Safe Deposit Box Insurance Company (SDBIC)
Thank you,
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Comments
I have used Hugh Wood, Inc for years, but have never had to file a claim. They are simple and painless as far as dealing with information and payment of my premiums.
In honor of the memory of Cpl. Michael E. Thompson
I use Collectibles Insurance Services (CIS). They're great.
Unfortunately I have had to file a claim before, but it was a very easy process and my claim was paid promptly.
I went with SDBIC (Safe Deposit Box Insurance Corp) last year. They seem like a good outfit, but the policy is coming up for renewal, and I’d like to take a look at Hugh Wood before renewing.
I’ve tried to find coverage and pricing details on the ANA website, but without luck. So I’m wondering whether one first has to be an ANA member before being able to see what Hugh Wood has to offer?
Currently have SDBIC. Easy to deal with and the policy did not seem onerous. Used to use CIS, which offers broader coverage than SDBIC (which is only for SDBs), although they had a lot of restrictions about insuring gold. I am actually in the market for new coverage so this was a timely thread.
Superb collections are built more by omission than by addition.
Yes, my reading of the SDBIC policy is that items are covered only when in the safe deposit box. Items are not covered when being transferred to/from the box.
So, with all due respect, just what are you paying for? How common is a documented bank security breach, resulting in a theft from a box, other than in the movies or a 9/11 type thing?
No experience with it so I cannot answer the question. I naturally wonder how you establish what you had and what you lost.
Many years ago I was engaged, through the firm I was working for at the time, to do an appraisal on behalf of a Midwestern bank. A long-established local coin dealer (now long deceased) was on the Board of Directors of the bank, and he was in the habit of borrowing money from the bank for his coin business by handing a loan officer of the bank with a 2x2 box sealed with tape and an inventory of the coins allegedly enclosed within and their values, for use as collateral.
Some of the earlier boxes tended to have a coin of the date listed but at a significantly lower grade, let's say an 1877 Gem Proof Dime represented by an EF coin. Apparently nobody ever got an outside appraisal on the coins, or even opened the boxes. As time went on the alleged contents got more expensive and totally fanciful.
Eventually he defaulted on a loan and the bank took one of the boxes to a different coin dealer for sale, and was shocked to hear the offer. All of the boxes were checked, and the bank asked the Director for an explanation. His response was to claim that the boxes the bank was holding for him in their safe had been opened and the coin switched, and to sue the bank for several million dollars.
Because the bank had not done due diligence in having the collateral independently appraised at the time of the loans, the bank stood a fair chance of losing the lawsuit. However, an amazing coincidence tripped him up. In his pre-trial deposition he waxed eloquent about one particular piece he claimed to have had that he was particularly proud of. It was an Uncirculated Turban Head gold piece of a specific date and denomination. He said that he remembered it well because it was the centerpiece of his exhibit at the ANA convention in such and such a city at a particular year circa 1970.
Well, it so happened that when I joined the Editorial Staff of Coin World in 1974, I worked for the guy who did the ANA Exhibits reports for the post-convention issues. The paper treated the exhibits as a very big deal, and literally did a writeup on every single exhibit. He trained me on how to do it, and I took over the task starting with the 1975 convention. By knowing how it had been done back in the day, which I am certain literally no one else besides me knew decades later at the time of the appraisal, I researched the post-convention writeups for the year in question and found the writeup of this man's exhibit BY HIS NAME (which they used to list back then) and lo and behold, there was no such coin in the exhibit. The man had perjured himself in his deposition, and his lawsuit fell apart.
Sorry to get so long winded, but let's say that you have an inventory of what you allegedly had in the box at the time of the loss. You may have sales receipts for the items, but how do you prove that they were in the box?
It happens: https://www.bbc.com/news/articles/cm2y2538lz8o (3,000 safe deposit boxes looted totaling tens of millions of dollars in valuables). Not to mention other risks, such as fire.
Anyway, isn't that what insurance is for? Protection and peace of mind against an unlikely, but possible, total loss.
Superb collections are built more by omission than by addition.
I’ve also read of instances in which bank employees have mistakenly drilled the wrong box and removed the contents. Presumably, a policy that only covers valuables while they’re in a bank box, offers pricing that takes into account the very small chance of a loss.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
This exact thing happened to me last year, and just by slim chance my coins were not in it, they were temporarily at my home. Just my late wife’s jewelry (not an insignificant potential loss) was put at risk. This was eventually resolved to my satisfaction, but it was a great lesson that SDBs are NOT 100% safe from loss. If my coins had been in play, I would have melted down.
https://forums.collectors.com/discussion/1118509/sdb-fiasco#latest
Other passions include golf, Moto Guzzi motorcycles, and Euro motorcycles in general.
Chris
BTW, I played golf a few months ago with a C level guy of a large regional bank, and during the round I told him about this SDB episode. He was appalled, and in his opinion I should have been much more aggressive with holding the bank accountable, including involving state bank regulators.
In retrospect, I think he’s right and wish that I had. This was blatant malfeasance, which could have resulted in very significant loss to me.
Other passions include golf, Moto Guzzi motorcycles, and Euro motorcycles in general.
Chris
Yes. But, in this case, it seems like the SDB IS the insurance. Lightning also strikes. Do we buy lightning striking a person insurance?
It seems like the point of real risk, to and from the box, is the one thing they don't cover. Which makes the coverage feel useless to me.
If you have to go across the pond to give me an example, that's kind of proving my point.
But, "resolved to my satisfaction." What would an insurance policy have added?
Whenever I access my safe deposit box, I take a photo of the box and the things that are in it. I know that’s not proof positive, but couldn’t your question equally apply to any coin or non-coin items covered by a homeowners policy or by other types of insurance?
@NJCoin Luckily I got the jewelry back from the lawyers who had taken possession of it (they were representing an estate of another).
I’m not implying insurance would have helped in this situation, maybe it would have, maybe not, I’m only pointing out that SDBs are not 100% safe. I was a bit taken aback by that realization, shame on me.
Other passions include golf, Moto Guzzi motorcycles, and Euro motorcycles in general.
Chris
No, the SDB mitigates risk, but doesn’t eliminate it. Insurance is an (optional) solution for the remaining risk, for those that are not comfortable bearing it.
If it can happen there, it can happen here.
Superb collections are built more by omission than by addition.
Insurance compensates you for a loss. For a loss from your SDB, how does a SDB do that? Spoiler alert: It doesn't.
If someone has substantial tangible assets they probably need an ironclad insurance policy to cover it. A local dealer RSR numismatics has been using Hugh Woods for years, thousands of dollars a year. His son shipped baseball cards worth over $5K that were lost/stolen unfortunately. He hadn't filed a claim for many years if ever. First time. They told him that they weren't going to raise their rates on him or had held back for years and now had to. With all the risks out there, if people have six figures or more at risk they need substantial insurance.
Yes, you must first join the ANA to use Hugh Wood now Brown and Brown. They have various types of policies which can be chosen to meet your needs. Covering your coins only while they are in the SDB to coverage while in transit is the range of options. Rates vary depending upon the risk involved. At one time I added a separate rider to cover shipment of an 82k coin to a dealer for sale. The cost was quite reasonable.
Their contact information is ANA@bbbrown.com if you’d like to inquire.
I started buying gold coins around 2001. I wanted an SDB but couldn't get one for...reasons. Anyway, that changed in 2010, and I got a box at a Chase bank near my apt in Santa Monica. Everything went from the box in my closet to the SDB. A few years later I moved to Savannah. I had closed my Chase bank account, but was grandfathered in, so I could keep the SDB. Everyone would ask me why, and I'd say that it wasn't like I needed to get to my coins. They were safe there, and I also kept things like a hard drive with photos (I'm an amateur photographer with several terabytes of pix) and other documents, so if a hurricane wiped out Savannah, I'd still have something. Every year I make a trip out to LA, and I'd bring a "fresh" hard drive full of pix and data to swap with the one in the SDB, and to check out my coins.
In May of 2020 during COVID, there was a huge riot/looting incident in Santa Monica. I watched a clip on the news from a security cam in MY bank of rioters rampaging around in the lobby area. Of course, there was no way they could have gotten into the vault.
Last year I got a letter from the bank saying "We're closing the SDB in 5 weeks and you need to empty it out before then, or we'll do it for you. I was heading to Africa in about two weeks, FOR two weeks. So I basically bought a plane ticket and flew out a couple of days later and emptied it out. If I didn't have to come back for my trip, I would have made a little vacation out of it. I was a little nervous that the bank was going to be closed during my trip for a random Murphy's Law reason. My buddy picked me up at the airport and we went right to the bank. and I emptied everything out.
Hugh Wood for the last few years. Collectibles insurance before that. I have a detailed inventory that I have had to provide to the insurance company that includes value and PCGS or NGC grade for coins over a certain value. Also have a lot of restrictions on what is covered when I take coins out of bank as well as restrictions on shipping coins.
I have never had to file a claim. Hope I never have to.
"Look up, old boy, and see what you get." -William Bonney.
Yes. Anything can always happen. Anywhere.
Doesn't mean everything lends itself to insuring against it. Insurance that only covers risks against loss when something is secured in a bank SDB, seems like very unnecessary insurance that is unlikely to ever be used.
But, sure, YMMV, and anything that helps anyone sleep at night has a value. And there will always be someone willing to sell anything that someone else is willing to buy.
To me, it seems redundant to spend money to store valuables in a bank SDB to mitigate the risk of loss if the valuables would be kept at home, and then to buy insurance against a loss at the bank that does not cover risks traveling to and from the bank, which is the only time there is ever any real risk of loss.
There is a lot of good commentary in this thread, but going back to the question I posted: Does anyone know if you have to be an ANA member just to see the Hugh Wood coverage and pricing options?
I’m sorry you haven’t received an answer to your question. I did, however, see an email address for inquiries included in one of the replies here: ANA@bbbrown.com
Why not try that?
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
Insurance is one of those products that you pay for, and hope to never use. And it is priced according to risk. I pay less for a year of SDB insurance than I would for insurance on a single Registered Mail shipment of the contents. Different risk profiles, different rates.
Yes, you’ve made it clear that you find it redundant. Others do not. Not much more to say about it. And many insurers do offer coverage for SDB contents plus travel to/from the SDB, coin shows, etc. As you can imagine, the latter coverage is much more costly since the valuables are exposed.
Superb collections are built more by omission than by addition.
I don't know if I'd bet on that.
I missed that. Thank you.
Never be nice to a bank.
Paper money eventually returns to its intrinsic value. Zero. Voltaire. Ebay coinbowlllc
Totally agree. And totally understand. I'm just saying that insurance against something that is unlikely to ever manifest -- insurance against a breach of a SDB for which the bank is not negligent, is hardly insurance worth having.
Hardly priced against risk, since the payouts must be microscopic as compared to the premiums collected. The latter coverage, the "much more costly" coverage, is the only one worth having. The fact that it's so much more expensive also indicates the payouts are likely microscopic as compared to the premiums collected.
In fact, that's probably a question worth asking before buying any of this insurance. Life insurance and homeowners insurance are very competitive markets, while medical insurance is a highly regulated one. They therefore have reasonable loss ratios.
I'll bet this is neither (highly competitive or regulated), being a niche market, and I'll bet the price you pay for this peace of mind is astronomical as compared to the actual risk of loss. Either with the full coverage or with the one that basically covers nothing.
Correct. There is ALWAYS more to say.
I doubt Huge Wood won't do business with you if you are not an ANA member. But I'm sure their deal with the ANA will not allow them to offer you ANA rates if you are not an ANA member. Kind of like AARP and AARP insurance plans.
Whatever you are doing, I promise you that if you want to do business with them, the ANA membership will more than pay for itself. After all, that's the whole idea behind the relationship.
I've used Collectibles insurance for about 5-7 years now including several claims that were a smooth process.
So if I had ~ $40K in a SDB and wanted insurance, what is an approx annual cost.
Agree. I just wanted to know if it’s possible to see Hugh Wood’s pricing before becoming a member. I’ve sent a message to the ANA using their contact form. We’ll see what they say.
For many years HWI had required active ANA membership for their numismatic insurance. I suspect they still do so even though they are folded into B&B.
In honor of the memory of Cpl. Michael E. Thompson
Should be $0. But it won't be. I actually have no idea, but even 1%, which would be $400, seems like $400 too much to me.
If the bank and SDB aren't safe, you shouldn't be paying for the SDB. Paying for insurance beyond that seems redundant to me. And insuring transportation to and from the box, when your risk will be very real, sounds like it will be cost prohibitive.
So my advice is to just go for the SDB, and not worry about layering insurance on top of that, in the unlikely event terrorists hit the area around your bank, and your contents are destroyed. Odds are that the policy would exclude that risk anyway.
You are literally insuring against burglars breaking into the bank, and then the vault, and then your box. That particular risk so remote that a fair price to insure against it would be close to $0.
To address @NJCoin speculations, if I recall correctly I pay about 0.25% premium (maybe a little higher, I don't recall at the moment) and this includes insurance for shipping coins via USPS, FedEx and UPS as well as traveling with numismatic material, coverage within an attended vehicle and insurance during coin shows, as well as the ability to keep a certain threshold of material in a physical location that is not an SDB. The levels of coverage vary as to how much is covered at shows or attended vehicles or for each shipment as well as material kept in other places, but overall it is a very low premium.
In honor of the memory of Cpl. Michael E. Thompson
The biggest thing about safe and secure tangible assets is to tell no one about what you have. Too bad it seems like a lonely hobby at times. I had a safe and was told that I needed to bolt it to the floor for it to be secure. My brother visited my apartment and said that it could easily be a theft target, but as far as I knew no one knew. I've had substantial valuables in rural safe town storage units without mishap. I'd think that bank deposit boxes are the best way to go. If you know everyone in the bank and you're a long time customer then you're probably ok.
Probably around $100 per year (0.25% x $40,000), but the price will vary by location. For comparison, you can get a quick number from SDBIC on their website: https://safedepositboxinsurance.com
Okay. I guess that sounds very reasonable. But, OTOH, I really have no idea what's "reasonable" here.
All I'm saying is that the fact that they charge anything at all for a policy that only covers contents in a SDB, and only if the bank has does not have liability for a loss, and only while the contents are in the SDB, an event that sounds much more rare than a person being struck by lightning, suggests the loss ratios on those policies are very low.
At the end of the day, if you are taking coins to shows and shipping coins, you do need something. If this is what it costs, regardless of the loss ratio, you really have no choice, because you need something. So It is what it is.
We got a little off course here. What you are buying, for what you are doing, is necessary. My original point was that insurance that only covers valuables while they are in a very secure location is really nothing, and any price is too high to pay for it..
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