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. . . and Old-Iron Insurance

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By Staff

SmokStak, By Harry Matthews

I recently spoke to my insurance agent concerning insurance on
my engines and tractors, and – as I understand it – if you think
your homeowners insurance will cover them, you’re probably
wrong. My agent said since they’re antiques and can’t be
easily replaced, they’re not insured under my homeowner’s
policy. In order to protect them, she must secure a policy with an
underwriter who specializes in heirlooms, wine collections and
other irreplaceable personal keepsakes.

I got to thinking about this is not so much from the standpoint
of fire or theft, but what happens if I’m in a traffic accident
and lose or severely damage an engine or tractor?

A few years ago, a guy lost his beautiful Rumely 30-60E
Heavyweight when the tractor slid off the hauler’s trailer.
Almost every casting on the tractor was broken or cracked, and
insurance didn’t cover anything. A hired hauler must have
special insurance added to his policy since normal cargo insurance
won’t cover antique equipment. It would be a good idea to check
your club’s haulers’ insurance because most insurance
policies state that antique equipment will not be covered. What
have others done to protect their collection against a worst-case
scenario, or do you all not worry about it? – Mark

That type of coverage is called ‘inland marine’ and
costs a fortune! Half the insured value of your homeowner’s
policy will cover the contents. Raise the insurance on your house
or out buildings as high as your agent will allow and take pictures
so you have proof of your collection. – Craig

As far as my steam engines and tractors go, I have the
high-value ones listed at only partial value on my farm policy.
Anything of much value has to be listed on the policy. As far as
gas engines go, I don’t have much insurance on them. After all,
if you insure all this stuff at full value, it’ll cost a small
fortune.

All insurance companies are in business to make money, it’s
just a matter of your personal risk and how much of it you are
willing to take. We’ve probably stumbled onto the reason many
nice items aren’t seen at shows any more. -Ken

I have an extra policy on my homeowner’s insurance for theft
and fire in the engine shed. My policy probably won’t pay me
more than $20,000. It’s the same for antiques and ancient art
objects in the house: I have to pay extra for it, and the insurance
company wants pictures and specifications for each piece.

For engine shows, I have insurance for $2,500,000 in case my
engines cause a problem (for example, a flywheel could fly into the
crowd), but when someone tries to stop a flywheel by hand on a
running engine, that’s their own responsibility.

My agent insures my tractor and engine collection at whatever
dollar price I set. 1 insure them for whatever is the going value,
and right now I’m carrying over $20,000 in insurance on my
toys. That way if something catastrophic happens with traffic, fire
or storm – since I live in a tornado alley – I’ll at least have
some money to buy something to replace them. – Rodney

Insurance is a lot like cell phone packages. A company may offer
lower rates, but when you read all that small print, paying their
so-called lower rates will most likely cost you more in the long
run.

My wife is an underwriter for a well-known insurance company. We
have our personal insurance through that company, but I haven’t
purchased any ‘special’ policy to cover my engine
collection because my engines are covered through my
homeowner’s policy. Even though I rent storage for them away
from my home, they’re still covered as ‘personal
belongings’ under my policy. It doesn’t matter if
they’re considered antiques or hard-to-replace possessions.

You can – in most cases – set a coverage amount for your
personal belongings. I believe it’s referred to as a
‘stated amount.’ Sure, it’ll cost a little bit extra,
but it really isn’t too bad. I recommend you contact your
insurance company (not your agent) to find out what will and will
not be covered. Of course, take a look at your policy first to see
if you can decipher it for yourself.

In most cases, insurance agents don’t really know as much as
you think they do. If they can convince you to buy extra insurance
you don’t really need, it’s more money in their pocket.
Every company has different ‘rules’ for policies, so take a
good look at the policy you have. You might be shocked at what you
are and what you are not covered for. – Ironman

Ironman is 100 percent on the money. Agents love to sell
‘inland marine’ coverage. Read your homeowners policy! Most
states require plain language, so policies are a lot more readable
than ever before. Never accept the first answer from a carrier
unless you’re completely satisfied with the answer. Your agent
doesn’t work for you, and he’ll sacrifice you in a
heartbeat to protect his relationship with a carrier -that’s
where his income comes from. Any agent who tells you the only way
he can cover you is with ‘inland marine’ has just told you
that you need a new agent.

Here’s quick test to determine how good an agent is: Ask who
re-insures the policy that you’re about to purchase. A
competent agent can answer the question, and the correct answer
will be another insurance company. Any agent who cannot answer that
question is wasting your time, and probably not selling you the
correct product.

I have bought insurance, worked for insurance carriers and
investigative agencies that de-license insurance agents – as well
as investigated insurance fraud. I’m probably a lot more
knowledgeable about insurance than the average person and well
aware that under New York state law an individual can defraud a
carrier, but a carrier cannot defraud an individual. – Franz

Let’s say you have a $100,000 homeowner’s policy. The
policy automatically covers ‘contents’ for half the
policy’s face value unless you also have very expensive
‘replacement value’ coverage. In the event of a total loss,
you’ll get $50,000 to refurnish either your house or your shed.
The insurer won’t care if you buy plasma TVs or engines.

To them, contents are contents, which is why I said earlier to
raise the insurance on your house as high as your agent will allow.
In the long run it’s still the cheapest way to protect your
stuff.

Don’t underestimate what your auto policy will cover,
either. Auto policies cover many things you wouldn’t even think
of! – Craig

I go for the company that will insure the whole ball game. Home
owners, auto, property liability -everything. I also do the same
for the business. If my car gets into trouble on my property, who
pays? Let the insurance company decide. If an employee gets hurt
driving my truck, who pays? Workman’s comp or auto insurance?
Let them decide. – Al

Insurance is always a hot topic on the SmokStak. We
presently have over 300 posts with the word ‘insurance’ in
them. Evaluate your own cautions, cares and concerns, and see your
agent if something doesn’t add up. – Harry

SmokStak (www.enginads.com/ smokstak.cgi) is an engine
conversation bulletin board with over 50,000 messages on file and
is part of the Old Engine series of Web sites that started in 1995
as ‘Harry’s Old Engine.’ Harry Matthews is a retired
electronic engineer and gas engine collector from Oswego, N.Y., now
residing in Sarasota, Fla.

Published on Apr 1, 2004

Gas Engine Magazine

Preserving the History of Internal Combustion Engines