Insuring your Audio Room?

Never become a member to audio forums. Stay off of social media. Never tell neighbors or close friends, maybe even family members what you're up to.

I put my insurance coverage to the test some 25 years ago when my entire system was stolen right down to the last cable.  I was surprised to find that Nationwide didn't give me any hassle whatsoever about honoring the full replacement value coverage. Of course I had sale receipts for all the equipment which had all been purchased new from dealers and I had to sign an affidavit of some sort about these particular items having all been in the house at the time of the burglary, but other than that Nationwide just accepted my list of equipment that was stolen.  They also accepted without question the current replacement prices for these same models, despite the fact that prices of several models had increased significantly since the original purchase.  For example my Martin Logan CLS speakers were the original version which had been replaced by the more expensive Mk 2 version by the time if the burglary.  

Nationwide also didn't object to my purchasing different equipment so long as the total cost was within the total replacement cost value.  All in all, a very good experience.

These days, however, I am not so confident things would work as smoothly.  I have several "bespoke" custom products so it would be difficult to prove what their "replacement cost" is today.  Also what about equipment purchased used from another person?  I suppose I could show what I paid through PayPal but I won't have a receipt from a dealer.  And then there's the whole issue of my LPs.  I don't have a list of my 3000+ records and certainly no receipts.  How would their "replacement cost" be determined in the case of some catastrophic loss like a fire or tornado?  These are questions I hope will never need to be answered.  

Back in 1978, Allstate wouldn't insure my house because my stereo system was considered way more than the % of the value of the house. 
Now I have extra riders for my stereo and art, pretty cheap, plus I have an umbrella for extra liability. 
Been thru 1 house fire that destroyed everything. Just because you have X amount of money for your items, you have to list every cd, album, fork, pair of underwear, cable, etc to the insurance company to get reimbursed. It takes months to file a claim. I have video of all my rooms contents and stored off site so if anything happens, I have proof.

Nothing to add to the discussion of insuring the system -- other than to emphasize the point others have made that you need to ensure that you have sufficient "contents" coverage to cover the system -- many policies assume contents as a fixed % of the value of the structure and this may not be sufficient to cover a high end system. I've also found it helpful to have a dealer periodically value the system -- or endorse the valuation you are keeping

Insuring LPs and media is more complex as many insurers simply will not touch them beyond very low limits. I've found that Collectibles Insurance (https://collectinsure.com/) provide good rates and good service (at least in setting up an out of state policy, I've never tried to make a claim) so you may want to give them a try

@kennythekey - I don’t disagree with anything you said. However, I think the word umbrella is actually a term of art (I got what you meant). "Umbrella" as I understand it as a consumer in an insurance context, is extra liability insurance over and above the insurance of things.
My suspicion is, cable analogy of "bundled" notwithstanding, it is cheaper to have one company do much of the coverage or at least have a broker figure out where some specialized insurance kicks in, as part of an overall insurance plan, rather than buying separate insurance for different kinds of coverage piecemeal.

I think a good broker can figure out where a cost savings is, rather than just selling you to maximize their fee. I’ve switched brokers a few times, though carried the same insurance, with modifications, over the years.
Part of the cost is also the deductible. If you are willing to eat the first 5 or 10 grand, the cost comes way down.

I recall that in the past, personal property insurance was more piece meal, but in my case it has become more packaged over time. My coverage includes my home and automobiles under an umbrella package.

I've gone over this with my broker, and they provide standard plan coverage, so in my case $475K for personal property. The only relevant type that falls outside of the standard is jewelry, and they told me that my audio equipment is covered in the $475K amount. This reminded me of bundled packages from cable providers.

Of course, you want to keep documentation and take pictures of your gear. And, I realized posting my system here, may be another good way to add to that documentation.
Kenny

Ira- to me, the key would be to talk to different brokers who represent those companies since you will be dealing with the broker in the first instance. I doubt if you called Chubb (which is now part of Ace or the other way around) the insurer would be able to do much more than refer you to a broker. It may be worthwhile, as mentioned, to talk to more than one broker, not because the cost of the insurance, per se, will differ, but there is the "personality" aspect, how hard they are willing to work with you to analyze and recommend, and the extent to which they represent more than one of these types of insurance companies to do a little comparison shopping on your behalf. 

Whart, thanks for your detailed suggestions! I'll take a look at the companies you mentioned. You mentioned special walls and electrical work. That's certainly something that would be important for some people to address. In my case not really but that's still a very good point. Thanks again!

I’m not in the insurance business, so others who are might have a different view, but there is an economy in using the same company for all coverage. These high end insurance companies insure valuable art, yachts, etc. and are used to dealing with specialized items of value.
 The flood insurance is a whole other thing--my recollection, when we lived on the Hudson River, was that the only flood insurance available for the structure was the government associated "FEMA" type. For the possessions, I’d have a discussion with the broker about how the various insurers cover when there is a risk associated with flooding. We did have "flood insurance" but again, my recollection is, it doesn’t have a high limit and we were being overly cautious- during Hurricane Sandy, several properties along the river were destroyed. We were on the mountain (high) side of the road and suffered no damage that I recall, to structure, grounds, or contents.

We do have a homeowners policy which may cover all the risk. I have already informed the company about the room and the coverage should be in excess of the value of all the internal possessions including the room. However, I was thinking of getting another policy just for the room and it's contents, probably not simply a rider. 

I was wondering if anyone had experience with taking out a separate policy just to insure an audio room. Is there anyone who knows of a specific carrier that offers a product either designed or well suited for a dedicated audio room? Perhaps something which could also include risk of a flood, considering it's in a basement. The current homeowners policy doesn't have flood insurance and adding it would about double the cost.

I think I would like a specialized policy in addition to the basic homeowners insurance policy. Does anyone already have something like this in place for their own system?

I appreciate the responses so far. Thanks for weighing in!

I changed my policy before I moved to increase the insurance on these items given that the equipment and records were going to be handled by movers (though I used specialty craters for the gear that didn’t have wooden shipping crates and packed the records myself). A few additional thoughts- you said insuring ’the room’- if you have special materials like acoustic treatment, flooring, electrical, etc, all of that goes beyond the norm too; when we’ve insured our homes, in each case an agent came after the policy was in place to do an on site inspection and adjust the value to reflect the replacement cost of the construction, special architectural or historical details, etc.
I also found that the high end insurers are in some cases cheaper for this stuff than the mainstream insurers. I first learned this with high value cars- the mainstream insurer wanted crazy money to insure, the high end insurer covered a Ferrari for less than the cost of our Volvo. And they are generally better to work with too. A broker who handles different underwriters can, with the information in hand, shop your needs to get the best quote among good insurers.
I believe, but am not sure, that a key factor in pricing is claims regarding auto insurance. Seems like the tail wagging the dog, but that’s my understanding. Most of these insurers want to do all coverage, including a liability umbrella. Doing the first exotic car led us down this path many years ago, and since then, we have remained with essentially the same insurer (though we’ve changed brokers over the years).
I did a detailed inventory of the LPs while I was packing them. Not every record, but the high value or rare ones, including catalog lists where I had most of a catalog (striking out the ones I didn’t own). The insurer then worked with me to develop a formula to average the value and hence, the overall coverage. The records were one tranche, the hi-fi gear another, the musical instruments and associated amps yet another, and other miscellaneous high value objects were scheduled on yet another list. You still have to prove loss, but it makes it a lot easier, along with the photo records others have mentioned.

The cost is not insignificant, and I am going through the process or reassessing the coverage now that the move is complete. It’s not that any of this stuff is of less value, but in some ways is at slightly different risk, now that it is back in my possession and control.
I also found that different brokers may be worth exploring, not so much due to price, but attitude and personal approach. Some of these brokers are stiffs and used to working with the wealthy, taking on a different attitude (which I didn’t necessarily find helpful) than others, who are less scripted. I want someone who I can work with easily and who ’gets’ it. You’d be surprised at the difference in comfort level you get just based on personality and the willingness of the broker/agent to bore down and work in depth with you to come up with the best solution. My experience with Chubb/Ace/Chubb has been extremely positive over more than two decades. There are others, like Pure, which I haven’t used that are also in the ’luxe goods’ high roller category. You should seek out a broker that can shop various of these types of underwriters.
While you are at it, also think about estate planning. If you go before your partner, the partner may be clueless. Just knowing who to contact (which may change over time) can be helpful if they want to dispose of this stuff. Ditto in your wills and associated estate plans. A third party executor will be clueless- at a minimum, the stuff should be called out and something included to have the executor search out specialty brokers for resale. (If both you and your partner expire simultaneously in a circumstance that does not impact the insured objects).

I specifically addressed this issue with our homeowner's policy insurers.  They affirmed to me that since we have replacement coverage that everything would be covered in the event of a catastrophic loss.  I have pics of my system and LPs, CDs and other silver discs to validate what is in my dedicated basement listening room.

+1 to the advice offered. Most homeowners polices have very low limits on things such as CDs and LPs, so you'll likely need a separate policy for them.

tls49 is right. Make a list with serial numbers and msrp values. Take photos and check with your agent to make sure you have "replacement cost" coverage. 

If you are renting, can this be categorized as renters insurance? 

Assuming you mean insurance as in your homeowners policy. A basic policy will have limits for different categories and all electronics will likely be grouped together. If you want to be fully covered, make a list of everything in the room with assigned values. Then take it to your agent and ask for a quote to add this as a rider to your basic policy.