No humour in comics payout

You have spent years collecting your favourite comic book. This collection is your pride and joy. Have you considered the possible risks to your collection?

You need to consider some risk management. Since comic books are paper products and can suffer damage, there is a real danger of loss. The benefit of applying some risk management is threefold:

  • Prevention of a loss;
  • Reduction of the financial consequences of a loss;
  • Peace of mind.

Next, you need to consider the frequency and the severity of certain types of losses. With this in mind, you now consider:

  • What losses you can avoid;
  • What losses you can control;
  • What losses you cannot avoid or control.

First, consider the losses you can avoid. Some steps you might take to protect your comics are fairly simple, and would include:

  • Do not lend out your collection to others;
  • Do not read the comic, keep it in "pristine" condition;
  • Keep an up-to-date inventory and save a copy at another location (server, relatives house, etc…) ;
  • Properly store your collection in cool, dry areas & acid free boxes;
  • Keep valuable comics in a fireproof safe or a bank safety deposit box;
  • Save all receipts, make copies and save a copy at another location (server, relatives house, etc…)

Avoidance is pretty stringent and does not allow you to enjoy your collection. So now you look at what options you have for controlling your risk:

  • Never "dog-ear" a page;
  • Store comics in plastic bags to protect from air, pollutants, & chemicals;
  • Wear white cotton gloves while reading the comic to protect from human oils;
  • Document all loans to trusted collectors and keep a log of trades;
  • Purchase two comics at a time - one for pleasure, one for posterity;
  • Do not store your collection in a basement which might flood.

What you cannot avoid or control, is accidents and the actions of others. If your friend soils a comic book by knocking over a cup of coffee or an ash from smoking materials, then the value has dropped significantly. If there is a hail storm, and a window breaks resulting in water coming into your home and soaking part of your collection, then the value is affected. Of course, fire, the most common hazard can affect paper.

For the risks that you cannot avoid or control, you can consider insurance. It is important that you understand how claims are paid out, when you look at this option.

If you have had significant water damage and have a claim, then the adjuster will first look at your policy. If you have purchased a policy with that particular coverage, then the way the property is shown will be examined.

In flood plain areas it is difficult to purchase water damage. When a forest fire has started in a location close to your home it will be difficult or impossible to start adding coverage for basic fire loss. Some homes in the urban areas have limited sewer backup coverage due to frequency of claims. A frank discussion with your agent or broker about what is important to you should help direct you to the policy best suited to your needs.

You can purchase an almost "all risk" type of policy with few exceptions. If you decide to buy extra coverage specifically for your collection, then you may not have a deductible, and the coverage and payout is agreed upon with the insurance company. This can involve appraisals, and there usually is an extra charge for this coverage.

There are two types of claim payouts. One is for an agreed upon amount for the comics with the values established. You suffer a loss, you get paid that amount. You are required to keep values up-to-date. You pay extra for this coverage

The next best type of claim payout is for replacement cost. You would expect that it will be straight-forward and you will get replacements or paid in same cash value for everything you have lost. That is not the way it works.

If you have purchased replacement cost for your contents, but did not insure your collection separately, then your claim will be based on the proof of loss form that you complete. You will be required to list the items lost. You will need to show the approximate date of purchase and the amount paid. You must do this carefully, because if you misrepresent a value then the whole claim can be denied.

If you have excellent record keeping of the purchases and disposals of your comics collection with receipts to back up your values then this helps to establish the true value. If you do not then you can do some research. Using resources such as the Internet, trade journals and catalogues might give you some documentation verifying your statement of values.

If you choose not to replace the item but take a cash settlement, then depreciation will be applied. Depreciation can be as high as 75%. It is dependent on the type of item, wear and tear, and ongoing usability.

If you choose to replace the comics, then it must be of like kind and use. You would purchase items and produce receipts. If the insurer felt that this was a reasonable amount to pay, then you will be reimbursed.

If you did not choose a replacement cost-type of coverage, then you will be paid on an actual "cash value" basis, with depreciation applied.

You are in control of how you handle your risk. This is not like the mortgage on your home. Your mortgagor will require you to have fire insurance. How you choose to protect your collection is up to you.

To find out more about the insurance options, call your agent, broker or insurance company.