Coin Storage, Safe Deposit Boxes, And Coin Insurance

I know this topic has come up several times, and there are archived discussions that are well worth reading. With the moderators' indulgence, I thought this might be a good time to prompt some thought with a new thread, and some personal observations and thoughts.

My wife and I just retired as dealers, after over 45 years in the business. We started with a mom-and-pop coin business,and then shifted to exclusively buyer-side representation. We were very safety-conscious (some of our friends called us safety-obsessed), so take that into consideration. We are now officially coin-less for the first time in our married lives.

These are just a few pointers and things to ponder.

(1) Never, never, never keep valuable coins in your home. The risk is far too great. It only takes one friend with loose lips to get the word out, and that makes more than the coins and house a target.
Tip: We used a safe that was located inside a title company's vault, and that was actually located in another state. Why this approach? Title companies are far less likely targets than banks. A safe inside a vault provided added protection. And storing the coins in a different state had tax benefits for selling them. On the other hand, it was a pain in the neck sometimes to make a 250-mile round trip to get ready for shows. Title companies may or may not be willing to allow this. We had close family friends who ran a title company, so we had an advantage.

(2) Don't get coin-related publications mailed to your home. Always use a P.O. Box or alternate address, such as a business office.
Tip: Go digital. We haven't subscribed to print publications in years. Digital editions are easy to store, and are obviously portable when it might be useful to have them handy for coin show reference.

(3) Safe deposit boxes very likely are not covered by insurance. Standard homeowner's policies have very low coverage limits for antiques, collectibles, coins, and other valuable items. Don't be surprised to see limits as low as $1,000 in those policies. Even if the coins are in a safe deposit box, those coverage limits may well apply. Two basic options exist: riders to homeowner's policies and stand-alone coin insurance. Both have benefits and drawbacks. Homeowner's policy riders may require disclosure of the identity and description of the coins, inventories, and even appraisals. Stand-alone policies may waive the listings, but will require proof of value when claims are made.
Tip: We have sold all of our inventory now, but typically ran in the $400,000 +/- range. The stand-alone policy was around $1,000 per year. That's a small price to pay to protect a large business asset.

(4) Always keep a detailed inventory of valuable coins. We took high resolution digital photos of all coins worth over $100, and maintained detailed digital inventories of all coins. It doesn't cost much to make these inventories, but the cost of not having one could be catastrophic. These would be needed to file the police report anyway, as well as for the claim.
Tip: Don't make it overly complicated. Use either an off-the-shelf coin inventory software or just create an Excel spreadsheet. The photos should be filed electronically under the inventory control number or another unique identifier. Back up the storage regularly, either in the cloud or on a hard drive that is stored off-site.

(5) The greatest risk to coins in safe deposit boxes isn't theft. It is flood.
Tip: Check FEMA and NOAA maps to see if the bank is in a flood plain. Try to pick a bank that is well out of a flood plain. Keep the coins in waterproof containers within the safe deposit box, safe, or vault.

(6) When traveling with coins, change your routine.
Tip: We always used rental cars to go to out of town shows. We drove two cars to some shows, with the coins in one and the other car trailing and watching for anything out of the ordinary. We sometimes drove one car to a nearby city, and then swapped the rental for another to use locally. Yes, there is extra cost. No, we never had problems. The cost and peace of mind were worth it.

(7) Visit your coins periodically. Even certified coins stored in climate controlled locations can have changes over time.

Now for a brief horror story to prompt thought.

Back in 2007, I was asked to appraise an estate that had a fairly large collection. The coins were exceptional, and most were certified. They had been stored in multiple safe deposit boxes in a secure bank. Hands down, this was one of the finest collections I ever saw. There were almost two hundred 19th Century proofs and high grade coins. Every single coin was destroyed. Why? They were flooded during Hurricane Katrina. The slabs were (and are) not waterproof. The toxic soup from Katrina irreparably destroyed the surfaces of the coins. They also were not insured. What had once been a $150,000-ish collection was little more than melt value shrapnel. We declined the chance to buy any of the coins, and really struggled to place any meaningful valuation on the collection. I understand that some of the coins eventually sold, but for truly awful prices.

Anyway, long post, but with the hope that it prompts thought and planning.