[NHCOLL-L:2581] Re: Insurance Values

[Shirley S Albright]

Rachel Delovio wrote:

>Hello everyone,
>
>First, I would like to thank everyone in advance for any input as I realize
>the assignment of monetary values to natural history collections is a
>difficult issue.  I was recently requested to provide a value to the
>collections for in-house insurance purposes and I have found this to be a
>challenging task.
>
>I would appreciate any comments on how other Museum's address this issue.
>Do you include a blanket cost for the entire collection or provide an
>item-by-item inventory?
>
>Thanks again,
>Rachel  
>
>----
>Rachel Delovio
>Collections Manager/Registrar
>Miami Museum of Science & Planetarium
>PH (305)646-4215
>FX (305)646-4300
>
>  
>
Well Rachel, I don't envy your task.   The New Jersey State Museum has a 
wildly diverse (and I DO mean 'wildly'!) collection.   Since I was the 
one who put forth the question to the list about the short-nosed 
sturgeon, I suppose you can surmise that we're having difficulty with 
this as well.

When asked for the insurance value of a natural history object, I try to 
base that number on substantiated numbers, such as a qualified 
appraiser's value or the market value (based upon a reputable auction 
sale or catalogues of similar objects).   As you already know, however, 
these two sources of information barely scratch the surface...but they 
are a start.

If neither of the above is available, I document as much of the 
following information as I can about the specific object as part of the 
insurance value I assign:
1.  Federal or state status - endangered, protected, extinct
2.  Cost of acquiring a new specimen (this includes expedition costs)
3.  Identification costs (this can vary widely depending upon whether 
the specimen is new to science and the amount of time a specialist needs 
to identify the object.   For the latter I use an average cost of  
$50/hr. - based upon an average of professional salaries, including 
benefits package, in this institution).    If you're familiar with your 
collections you can pretty well ballpark how long it would take an 
expert to identify a specific object.
4.  Cost of preparing the specimen (fluid preservation, taxidermy mount, 
matrix picking etc.)

A blanket cost for the entire collection is, in my opinion, sort of 
worthless because in the event of catastrophic loss, the institution 
would be called upon to demonstrate the existence and value of each 
specimen - much like homeowner would if they lost their home in a 
fire.    I don't even like to think about the quagmire that process 
would entail, but...."crap happens".    Besides, if you know the 
individual values, it's just a hop-skip-and-jump to a total for the 
entire collection which can be supported, not just imagined.

It is much more likely that portions of a collection will be damaged or 
lost, rather than the entire collection.    A steam pipe bursts, a truck 
transporting objects crashes, a collection worker has an oops,  a nest 
of termites appears in your wood furniture etc. etc.  
The real question becomes....even if you know what your collection 
should be insured for, what museum has the financial wherewithall to pay 
for a rider with a reasonable deductible?  I work for a state government 
museum, and although the state tells us if is self insured, even their 
risk management people were amazed at the cumulative values for even a 
small portion of our formally appraised collection.    I don't think 
they were prepared to hear what 2 or 3 modernists paintings were worth!

This would be a great topic for a regional or national meeting because 
the events of 911 have plunged everyone I know into insurance hell.   
And the issue is not going to go away as terrorist activities and wars 
and rumors of wars continue.   In recent months there has been renewed 
interest by our State's risk management staff on what we have and how we 
use it.   I think a consortium of interested parties should spearhead a 
discussion on this issue before critical mass is reached....and trust 
me, it will!

It would be a great service to all of us, Rachel, if you would pull 
together all your offline and online responses and post them to the 
list.    I know I'd appreciate it!

Thanks,
Shirley Albright


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