06-14-2018 05:41 PM
What’s the best insurance options to cover fraud and expensive items being sold on consignment ?
06-14-2018 06:27 PM
What type of seller buys insurance?
06-14-2018 06:36 PM
It's really a personal decision, but hopefully others will come along soon with advice.
Many use what they call the cookie jar method, where you put aside a portion of every sale so that you are covered when and if something happens. If nothing happens, then you build a nice nest egg for you.
Others use the insurance that their carrier provides. However, some of these have a reputation for possibly being difficult when it comes to a pay out.
I know that isn't very helpful, just some basics. I doubt the cookie jar method will be useful for you at this point because to be effective, it needs to have been implemented some time ago, to build up a fund. But just a thought for the future, maybe.
06-14-2018 07:58 PM
It a safety net.
06-15-2018 01:49 PM
Insurance can't protect you against fraud.
Insurance has nothing to do with consignment.
06-15-2018 02:04 PM
Insurance has to do with consignment if they are holding inventory for others and asking about property insurance not shipping insurance.
06-15-2018 02:06 PM
What type of insurance are you inquiring about?
06-15-2018 02:30 PM
06-15-2018 09:33 PM - edited 06-15-2018 09:36 PM
We use Hugh Wood International, a British firm with offices in London, New York and Toronto.
They are specifically a firm that insures collectors and the dealers who sell to collectors.
In addition to the usual fire, water and shoptheft coverage they will cover your stock on the way to shows and at shows.
They have been for most of this century the insurer for the American Philatelic Society.
For example, when APS showed the world's most valuable stamp at their International Exhibition a few years ago, HWI not only insured the stamp, and all the others in the Court of Honour, several million dollars value, but also the exhibits themselves, another few million and the stocks of all the dealers at the show.
They are able to understand how fast a dealer stock can change. Or a collection.
Here's how good their coverage is.
APS has a thing called 'circuit books'. A collector puts his unwanted items into a book and mails it to another APS member. The next guy takes what he wants from the book, then mails his payment to the owner and the book to the next guy on the list. Some 50 members later, the book returns to the APS. Think about that. HWI insures the books. There are a few thousand of them circulating at any given moment.
Hugh Wood does not usually do one offs (although they will do temporary* additions ) only selling annual policies.
They do insure other types of collections and dealer stocks.
And yes, including consignments.
*We used them when we brought this item back to Canada. https://sparks-auctions.com/auction-25/
It sold for $285,000 Cdn before buyer's premium and sales taxes. The consignor was pleased.
06-15-2018 09:39 PM
06-16-2018 01:58 PM
Does Hugh Wood International insure against fraud?
06-16-2018 04:01 PM
Depends on the 'fraud'.
They do insure against theft.
I don't know the American staff, but Gina is their officer in Toronto and is the one we've always dealt with.
https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapid=166569874
06-16-2018 04:08 PM
06-16-2018 04:08 PM
06-16-2018 04:19 PM
Yes.
The links I gave were to the Bloomberg report on the US arm and to the website for the Canadian arm.
About consignments.
We don't pay out to consignors until the transaction is complete. This may include a period of time during which the purchase is being 'expertised'. If the purchase gets a bad certificate, the transaction is not complete, the buyer gets a refund (if he has paid) and the consignor doesn't get paid.
Some of this is esoteric and pertains specifically to philately which has a strong history of handshake dealings and respected expertising bodies.
The situation has more to do with our public auction which is not eBay, although we do have it online and support live internet bidding.