[Baumli]

To all ye gentry,

It happened again--to another of my friends. A travesty.

And it could happen to most members of this Society if you aren't careful about your home owners insurance.

The point: Many polices have a clause, buried way in the back of course, in the fine print, which essentially says that your possessions are not covered against theft if you post photos of any of your possessions in a public forum. Some policies are worse: It isn't just theft coverage you lose; it's all coverage. In other words, if your house burns, posted photos of its contents invalidate your policy.

Not all policies have this gap. And most often when they do, it applies only to scheduled (as the term goes) items, e.g., expensive antiques, musical instruments, and ... stereo equipment or video equipment which you have purchased extra insurance on. This gap in coverage is why you'll notice that many photos of marriages in "upscale families" (a neutral phrase?), which you see in regional newspapers, only have photos that are taken outside the house.

Of course, it's possible you're safe. But believe me, if your policy has this gap in coverage, and you have a loss, their agents will prowl the Internet looking for photos of your possessions. I said this has twice happened to friends of mine. The first was in Columbia, Missouri, who published photos of his daughter's marriage. When some of his very expensive antique furniture got stolen, it was not covered because of these photos that had been taken inside his home. The second instance happened more recently. A friend in Kansas City had his entire stereo stolen (except for the turntable!), and his loss was not covered because he had published a photo of his stereo in (of all thins!) an ad for a component he was trying to sell. (Of course, he now has lost the opportunity for selling it.)

I'm not trying to be alarmist. But many GAS members have photos of their stereo or video systems posted, and it might be worth having a careful look at your policy to make sure posting does not invalidate your coverage. (And it just now occurs to me--there also is the fact that those who publish many photos on Facebook might invalidate their coverage.)

Keep in mind the fact that you might not have a "master plan" of your policy (probably about 100 pages long), so you may have no way of finding out whether this matter affects you. And even if you do have a master plan, you might overlook this exception.

So ... as an attorney friend tells me: "Get it in writing from your agent whether or not this affects you, and how."

Of course, since I don't trust either insurance agents or lawyers, who is to be believed? Regardless, get the letter. That's your only guarantee if you do have a loss. (Not that they don't have other ways of getting out of paying a claim!)

I hear you groan. Who wants to go delving through their home owners insurance papers?

But you won't be groaning as loudly as would be the case if your possessions were stolen and not covered by insurance!

All the best from:

The Prudent Paranoic,

Francis Baumli

[Scott F.]

Hi Francis,

Good advice. A number of years ago I contacted my insurance guy and we scheduled all of our gear including separate scheduled values for my vinyl and tube collection. I don't remember how much the separate riders costs but they weren't hideously priced.

You are exactly correct, insurance companies will do everything they can to keep from paying major claims. That's why you need to put ALL of your valuables on a separate schedule and get a rider that insures those pieces specifically.

[rollo]

Wow ! Thanks for the heads up.


charles

[mitch stl]

Interesting. I've been in the insurance business for over 35 years as a commercial property & casualty broker and have never seen a policy or endorsement that excludes theft coverage if photos are posted online or printed publicly.

I just checked the ISO (Insurance Services Office) home owners forms. This organization publishes the most commonly used policy forms used by insurance carriers. None of the base forms have such an exclusion nor do any of the available endorsements.

What insurance company was involved in that claim? Some carriers do have custom forms or endorsements.

As noted, I do commercial insurance, but the agency I'm with has a large personal lines department. I'll ask them about this on Tuesday if they've ever heard of this.

I suspect that if coverage was denied in the cases you describe, it involved some other issue. I've seen a lot of creative misinterpretations/minunderstandings of coverage issues over the years.

That said, one does want to be careful about making things too easy for crooks. But this is from a risk management perspective, not because of a loss of coverage. For example, I still have auto insurance for an accident if I drive drunk or break the speeding laws. I may get cancelled or nonrenewed afterwards, but I don't lose coverage for the current event. However, having coveage still doesn't make drunk driving or speeding a good idea.

[Bob in St. Louis]

Interesting. A topic I didn't know I should have been concerned with. 

There just may be a "couple" photos of my room out there. Might be one or two of my sons room...well...A photo of the wifes "woman cave" too. Not to mention some new pictures of my daughters new combination audio and theater "little girl cave".
Hmm....Sounds like something I should check into.

Thanks for the heads-up. Very much.
Bob

[KenSeger]

I forwarded Baumli's entire message.  Here is what my agent replied.

"I have been doing Insurance for over 30 years. I talked to Stephanie at Crane. She handles Safeco for our Agency and she has also been in Business over 30 years. Neither of us have ever seen or heard of a claim denied because someone showed photos etc. on a social media site such as Facebook. We not only have not ever seen it with Safeco we have never seen it with any of our other Companies.
I have heard the myth many times over the years that Insurance Companies won’t insure Red Sports Cars. I laugh at that one because our Insurance Companies NEVER ask what color the vehicle is when we insure it.
I have told people many times do not post on Social Media when you are about to go out of town on a trip because this invites someone to burglarize your home. This would still be a COVERED Loss if it happened."

Your mileage may vary.

I do think Scott's suggestion to list all unusual valuables like hi-fi gear, power tools, musical instruments, antiques with your agent is a good idea.  Depending on the value and your coverage, your main household insurance might cover it.  If not, riders are very inexpensive if additional coverage is needed
Ken

[vinyldavid]

I've never asked about that.  When I talk to my insurance agent next, I will be sure to ask him.

I have replacement value insurance on my gear, as while I might not have paid much for it, to go out and replace it immediately would take a very large chunk of capital.

[Don_S]

My State Farm agent said no rider was necessary if the value of ALL of my personal belongings (including audio) was below my total coverage. There are some things that require riders but I do not have any of those.

I do have replacement value coverage and it paid off big one time many years ago.  I learned something then.  SALES RECEIPTS---if you have those it is a huge help.  Do you really want to sweat blood convincing your insurance adjuster that the power cords stolen cost $3K each or that your Ti bicycle cost $5K?  Having sales receipts saved my butt.

Of course the insurance check did not cover all my replacement costs.  I kind of upgraded out of pocket. 

[mitch stl]

I checked with both the personal lines people and claims specialist in our agency (which has been in business for over 125 years), and they confirmed they have never seen an insurance claim denied because photos were posted online. No one has ever seen a policy form or endorsement that contains this exclusion.

This is either an urban legend or the person involved in the denied claim completely misunderstood the real reason there was no coverage.

[Baumli]

Dear people,

I suppose this reply is to Mitch primarily, and although I've not the inclination to stay with this topic (I am a busy writer--at the present doing work with early Bohemian and Moravian composers), I feel I should say a few words.

First off all, while I do not at all want to indulge in mud-slinging or ungentlemanly conduct, I am going to just say outright: I do not believe anything an insurance agent tells me. Often they lie; just as often they don't know. And even if they're telling the truth and do know the situation, they still can outright deny a claim even if you have all legitimacy on your side. This happened when I moved to Saint Louis 19 years ago. The big moving company did over a hundred grand of damage to our possessions. The moving company was completely liable, my homeowners insurance was completely liable, and my insurance agent was completely liable under his own "small business liability" coverage. But they all three refused to pay even though they were entirely liable. My only recourse was to sue, and by the end of that, once the attorney got his cut and all legal fees were paid, I came out with about thirty grand. I could tell other stores that are more grisly and grim, some almost humorous, but I don't want to bore.

As to photos of one's audio equipment: There is the question of prudence. I think one would be downright foolish to post pictures of one's stereo or video system on Facebook, and also announce that one is leaving town for a month. As for insurance companies: Mitch, with all due respect, I am beginning to feel that calling something an "urban legend" these days happens so very often that the phrase itself is becoming an urban legend. You can talk to agents--sales and claims agents--all day long, and I readily concede that policies vary. I do know that in the master plan of my company, it very clearly states that pictures posted in a public forum invalidate theft coverage for any interior contents of that home. Have you seen the master plan for your own policy? Or are you relying on what people tell (sic) you? By "master plan" I mean that gargantuan document that is over a hundred pages long and spells out all the miniscule detail. Read it carefullyt. If you can't find anything on this topic, talk to your sales agent. If your sales agent delivers to you the same mantra I have gotten from agents many times, namely, "Don't worry. You're covered," then do what my lawyer advised: Request, i.e., demand, a letter from the sales agent stating that you are covered for theft and all other losses even if you post pictures in a public forum, and that they themselves guarantee the coverage they claim you have on the basis of not only your own policy but also their own small claims liability which they have for their own business and office. Ask for this from your sales agent, and you might want to cover your golden ears, because you're likely to hear the squealing of brakes.

As to my two friends who were burglarized and could not collect because they had posted pictures--well, both of them went to see an attorney, who informed them that they didn't have a case. My own company doesn't cover theft if I have posted pictures. All three of these companies are "name-brand" companies; you would recognize their names from the advertising they do. If your company does cover you for losses even in the event of burglary, then good. This means the policy says you are covered. It does not mean they will actually pay a claim. Unless you sue, which means you never quite collect anyway.

Urban legend? Not in at least three companies I could name, but won't here, because I don't want to "get into it" with insurance companies. I have better things to do than fight with dishonest (or ignorant) representatives of a predatory industry. I will add that I personally know two men, each who runs a company that does interior painting, and both of them have told me they would like to take pictures of some of their work to show prospective customers, but they can't because some (sic) insurance companies won't pay a theft claim if a picture of what was stolen was shown publicly. I'll tell them to consult with their lawyers to find out how universal this urban legend is.

I will try to bolster my credibility here by telling a very true story. Not about a loss that didn't get paid, but about one which might not get paid. I personally know my previous sales agent for my previous homeowners policy. (She finally quite in disgust.) About ten years ago, full coverage for a loss to my home was reduced to 90% coverage if the loss is from earthquake. About three years later, that was reduced to 70%. In conversation with my friend and previous agent, she told me of a convention she had just attended about earthquake coverage. She told me that a report was read which stated that if "the big one" ever hits Saint Louis (one-third of a million lives lost in downtown Saint Louis, and every brick building reduced to rubble or at least totaled), then their insurance company simply would not be able to pay that claim. They would have to "bail out" and depend on the Federal Government to pay for it all, and the current estimate was (that was about four years ago) that the Federal government would pay maybe 30% of what is claimed, and it would take a long, long time to get that payment. Now this, mind you, is not urban legend; nor is it fact. It is speculation about a dire future and the limitations of the insurance industry and both the generosity and limitations of the Federal Government.

On the basis of the revelation, I realized that, when it comes to earthquake coverage, I now could only get 70% insured coverage but my sales agent reported that her company believed the actual coverage would be 30% though not by them, but rather, by the Federal Government.

Well; when the next premium came due, my wife and I had a serious discussion, and we dropped all earthquake coverage. (Which gave us a considerable savings on our premium.)  I know my sales agent sure wished she hadn't told me that bit of industry news, but I was straight with her, and she understood. But tell me, Mitch, where in the world am I going to go to get the facts on this speculation about insurance coverage should "the big one" hit? I don't know. I just know what I was told, and I made a financial decision based on that report. I can only hope that my decision was the more prudent of the two possible financial scenarios.

Call it all what you will. Urban legend. Facts. Luck. Whatever. I am sure of only one thing, and this I learned from my dad more than 50 years ago: "You think you're covered, but when it comes time for an insurance company to pay, they never do." He was, I admit, exaggerating the case only a tiny bit. On very small claims, they usually do pay. They also often increase your premium because of your claim. The only (and I do mean only) times I have ever seen a claimant not get screwed was when the claims agent was a relative, a personal friend, or when the person pressing the claim was the claims agent himself or herself.

So please. Keep in mind that urban legends aren't always legends that aren't true. Also keep in mind that insurance companies do vary in what they cover. Keep in mind my view (which you can dismiss as mere opinion if you want--I don't care) that whatever coverage you believe you have, this doesn't mean that in the event of a loss the insurance company will actually pay.

Believe me, if I were a vastly wealthy man, I would drop all insurance coverage except auto liability--which I am required by law to have. Other than this, I would take my chances and not support an industry which is predatory, dishonest, ignorant, and (as has been the case with every claim I have ever pressed--all of which I have won) in the end a waste of time. I spoke of the thirty grand I recovered on the loss which occurred when I moved to St. Louis. The hours I spent on pursuing that claim caused me to lose so much income because of writing opportunities I did not have time to pursue that I would have been better off just dropping it. But always, it seems, my temper and my sense of principle (oh, those damned principles!) cause me to pursue such claims.

Which is a lesson I need to keep in mind right now. As a writer, I have several projects "in the works." But here I am going on and on about insurance again. Which is probably an entirely futile indulgence.

So just one final reiteration: Get that letter from your sales agent I above mentioned. But don't be surprised when they supply excuses instead of the letter. Meanwhile, pretend you still have faith in corporate capitalism. As my (now dead) friend, Gore Vidal, used to put it, "In our country, we have socialism for the rich, and free enterprise for the poor." When he spoke, I listened.

Curmudgeonly yours,

Francis Baumli

[Guy 13]

Hi Francis and all Audio Circle members.
Very long post, but very well written.
Thanks.

Guy 13

[thunderbrick]

I am not disagreeing with Baumli, but my experiences have been different.  My wife underestimated how long a tank of LP would last on her small lake cottage.  Winter came, pipes burst, lots of damage  , and they paid every penny (minus the deductable,of course), despite the fact that we were culpable.  Huge storm/small tornado damage to my yard and utilities.  They even paid to remove the dozen or so torn-up trees and fix the lines to the house.  No question at all.

[Guy 13]

I am not disagreeing with Baumli, but my experiences have been different.  My wife underestimated how long a tank of LP would last on her small lake cottage.  Winter came, pipes burst, lots of damage  , and they paid every penny (minus the deductable,of course), despite the fact that we were culpable.  Huge storm/small tornado damage to my yard and utilities.  They even paid to remove the dozen or so torn-up trees and fix the lines to the house.  No question at all.

Hi thunderbrick and all Audio Circle members.
If your insurance company is so good, maybe you should share with other Audio Circle members
the name of your insurer,
unless this is againts Audio Circle rules.

Guy 13

[thunderbrick]

I will take Baumli's advice and check my contract.  I'd hate to have my three Sony 34" CRT TVs stolen with no recourse.  They are getting hard to find.   

[mitch stl]

Baumli, I work in our agency's quality control department and read/interpret insurance policies for a living. I am not in sales. I've been an expert witness for insurance litigation. I have written a book on commercial property & casualty insurance (Insurance: A Big Decision for Small Business, Mitchel Smith, 2011, available on Amazon in both paperback & Kindle versions - sorry for the shameless plug but it seems appropriate to mention since my reputation has been impugned.)

So, yes, I have read my homeowner's policy (with Fireman's Fund) as well as the standard ISO HO3, HO4, HO5 and HO6 policies and the available endorsements. There are no coverage exclusions in these policies that are triggered by posting photos.

You stated that you do not wish to "indulge in mud-slinging or ungentlemanly conduct" but then proceed to make some fairly broad accusations. While I know of no industry that doesn't have a few bad apples, the people I work with on a daily basis try hard to make sure our clients have the best coverage for the money and understand its scope.

You've repeated the statement that your policy does contain such a exclusion. I'll repeat my question: what's the name of your insurance company? My only interest is to obtain an copy of their homeowner's policy form and read it for myself.

I would like to see an exclusion I've never seen before, as would several others in our agency.

[mcgsxr]

I am sure there are differences in policies between Canada and the US.

My wife works for an insurance company, and up here in Canada she has not heard of any such clause.

We recently changed providers, and I went into great detail about my system, the specific components etc.  The reaction from the company representative was a blank stare, and a comment that it all be covered under my policy.

I guess some would take that at face value.  Given my wife works there, I can assure you they will be paying out if there is a problem!

I take pics of the gear I own, and I document what I paid etc.

I once had a 4K mountain bike stolen in university, and it was covered under the homeowner policy.  I had brought that very bike to the offices when I signed up for the policy, and I had police records of my reporting the incident etc.

[Baumli]

Dear members,

I suppose I owe somebody one more post, but this is the last. We are an audio society, not a political science forum.

My point in stating that I did not want to impugn character or indulge in mudslinging was meant as a courtesy to Mitch, and I still extend that courtesy. If we ever meet, Mitch, let's enjoy a sardonic laugh about our exchange, drink a hearty toast, and both of us show prudence enough to stay off the topic of insurance. Obviously we have very different views, and empirical bases for our judgements. I suspect you are a congenial, optimistic, cheerful fellow and I hope you remain that way. I am pessimistic, but cheerful; easy to get along with, but testy on certain subjects. I also look out for my friends and neighbors.

You, Mitch, speak of a few bad apples? This, I assure you, is an "urban legend." Actually there are tons of bad apples. Somebody do a national survey on whether people trust insurance companies. "Trust," I write. I'll wager a lot on what the outcome of that survey would be. When I was growing up, and for many years after I left home, my dad had the biggest horse operation in the world. That's a lot of horses. (To me "horse" is a 4-letter word spelled "w o r k.") That was a big operation he had, and I don't think there was ever a time when he wasn't in the middle of fighting with an insurance company. But he died in 1997, so that was a long time ago. How about more recent situations? Let me think. I know of three people, personally, who in the last two years had dealings with home owners insurance companies.

Example #1: A neighbor. Merely a windstorm, it was, but it caused a large limb from a live, healthy oak to go through his roof. The repair bill was about two grand. They paid for the repair promptly. Good for them. But they raised his premium $600 a year for the next 5 years even though the tree was healthy and posed no previously noticeable hazard. He tried to switch insurance companies. A new company would charge him the raised premium too. So, as he glumly put it, "They paid two thousand for a repair but are going to charge me three thousand for what they paid."

Example # 2: A friend, whose family lives in Saint Louis but goes to school at Carbondale, is an amazing musician on both the piano and oboe. Her oboe has a solid ivory body, and it had "scheduled" coverage for its full value. Her car broke down last winter, she got a ride to Saint Louis, and left her oboe in her car overnight on a very cold winter night. When the car was fetched the next day, she found that the cold had split her oboe along its entire length. The insurance company refused to pay because she had been "negligent" in leaving the oboe in her car's trunk. Well; I agree that she did not exercise good judgement, but I went with her to one of my attorney's, and he looked the policy (and the oboe) over. Yes; she was still covered. She could sue, but by the time it was all over, she would be lucky to come out ahead (of attorney and court fees) even a thousand dollars. So her father refused to press a lawsuit. The oboe could not be repaired. A total loss--of oboe and money.

Example # 3: My brother, 12 years ago, built a storage garage that I envied. It measured 30'/60' and he put in two steel doors, each 12' wide, which rolled up  to the ceiling. A neighbor's car slipped out of gear, rolled down a gentle slope, and totaled one of those doors. But the neighbor's car insurance would not pay, nor would my brother's homeowner's insurance. Why? Because in both policies a steel door is completely depreciated out after 8 years. Yes, Mitch; after only 8 years. And both policies are from "name-brand" companies! So all of you with those nice steel doors on your garage, check your policy, and be warned on this topic too. It didn't matter that neither door had a dent in it or a scratch on it. They had depreciated out to a zero value, and so it was a total loss--door and money.

I'll give one last example, this one national. Remember what happened the morning after 9/11? Our President Bush had been asked by the national insurance industry to declare what had happened an "act of war." This way the insurance companies would not have to pay a penny for loss of property or life. I used to have a video of Bush, the next morning, giving his statement to the press. He said something like, "It was not an act of terrorism, it was an act of war!" If you have access to that video (I gave mine away), you'll note that he jerks his head forward, lifts his eyebrows, and pauses, as if to say to say to those people who had called him the night before, "See? I did what you told me to do!" Fortunately, Congress refused to declare it an act of war. About a year later, on NPR, I heard a report that because of the total loss for 9/11, the insurance industry that year made a profit of only 6 percent instead of their usual 20 percent. I can't give a citation on this, Mitch, nor do I care to do the research to check their accuracy; but I am absolutely sure these are the numbers I heard. When I went to bed that night, I wondered if I should spend the night sobbing into my pillow because the insurance industry made only 6 percent instead of their usual 20 percent, or if I should just sleep peacefully (vengefully?). I seem to recall that I chose to sleep peacefully.

No; I'm not going to mention a single name of even one company. I know how easy it is to get sued, and you do too.

So I suggest we leave this topic be. I made my points: Posting pictures of your audio gear (or other interior possessions) in some (sic) instances invalidates insurance coverage. Having scheduled insurance on your audio gear is, as Scott Faller mentioned, a good idea; but as my oboe-playing friend found out, scheduled insurance doesn't at all mean they will actually pay in the event of a loss. And in virtually every situation I know about, directly or indirectly, the insured person lost badly. If not at the time of the claim, then subsequently, when premiums got raised.

So Mitch, you enjoy your job, and in your glass bubble you can talk about urban legends and bad apples. In my scriptorium, I will write about music, translate Latin, now and then seethe about insurance companies, and also (not least) sometimes be prudent enough to spend my time listening to music instead of arguing about insurance.

On this amiable note, I am abandoning our topic. Verily I concede that I am impugning the insurance industry. I realize I am "touchy" on this subject, but I certainly am trying my best to not impugn your character. If you work for that industry, get paid a wage, and even believe in the reputability of the insurance industry, then that is your business. I'll leave it at that, and trust that both of us have enough going on in our lives that this topic need not curtail our ability to enjoy the mere (?!) process of living. And I do hope that, if ever we meet, then we can be congenial with one another and talk about ... well, how about either music or audio gear?

Musically yours,

Francis Baumli

[daves]

On a side note about trust, every day I wake up and say a prayer of thanks that I found and married a nurse. They always are in the upper echelon of professions that the general public hold in highest esteem. Most of the time when you end up in a hospital, it is a nurse who is holding your hand, checking you out every hour, charting your vitals, slinging your meds, and dealing with the petty (and significant) whines we men so like. 

http://www.angusreidglobal.com/wp-content/uploads/2012/09/2012.10.02_Professions.pdf

Also, I am sure I am like most people. We pay to get insurance, and then do not educate ourselves on the ins and outs of it until we are suddenly cast upon the shores of needing help, immediately. If the worst ever befalls my collection, it will be a long and harrowing experience, even with the detailed rider, full documentation, photos, and computer spreadsheets. It is a situation where you pay and then pray you never have need for it.

[Guy 13]

On a side note about trust, every day I wake up and say a prayer of thanks that I found and married a nurse. They always are in the upper echelon of professions that the general public hold in highest esteem. Most of the time when you end up in a hospital, it is a nurse who is holding your hand, checking you out every hour, charting your vitals, slinging your meds, and dealing with the petty (and significant) whines we men so like. 

http://www.angusreidglobal.com/wp-content/uploads/2012/09/2012.10.02_Professions.pdf

Also, I am sure I am like most people. We pay to get insurance, and then do not educate ourselves on the ins and outs of it until we are suddenly cast upon the shores of needing help, immediately. If the worst ever befalls my collection, it will be a long and harrowing experience, even with the detailed rider, full documentation, photos, and computer spreadsheets. It is a situation where you pay and then pray you never have need for it.

Hi Daves.
Thanks for the link.
Very informative and at the same time,
I find it a little funny.
Of course I was most interested about the statistics of Canada,
but including USA and Britain help me compared.
Thanks.

Guy 13
Here in Vietnam, if they did a survey,
I am sure the corrupt police, politician
and incompetent doctors would be at the bottom of the list.

[mitch stl]

A simple question. A very long non-answer, with many unrelated segues.

You claim there is a homeowners insurance policy that contains an exclusion for theft of personal property when pictures of the items have been posted online. No one I've talked to in the industry has ever heard of this.

Since you are unwilling to provide the name of the carrier or a copy of the form, I can only conclude that your bluster on the subject means that the alleged form doesn't exist. (And, no, after 37 years in the business, I've never been sued. I haven't even had anyone complain about a description or summarization I've given of what a policy does or does not cover.)

As for premium increases, my HO premium went up $600 last year and $300 this year and I've had no losses. However, for Missouri alone, insurance companies paid over $2 billion in losses for Joplin and we had similar but smaller storms that did severe damage in Sunset Hills, St. Charles, north country and other areas in or near St. Louis. In total, Missouri has had 12 notable tornadoes with extensive property damage in the past 4 years.

Where do you think the money comes from to pay those losses?

 It comes from the premiums paid by not only those who do have losses, but also those who don't. In 2012, as a total, property & casualty insurance companies paid out in claims and expenses 103% of the premium they collected (the percentage is called the "combined ratio"). In 2011, they paid out 108% of premium. That is partially offset by interest income, but that is down in recent years due to the earlier recession and now lower interest rates.

Sorry you've had bad experiences, but I will agree that since you're unwilling to answer or provide info to address the one thing I've questioned, it is probably best to move on at this point.