Saturday, July 14, 2007

Insuring Your Camera Gear

Insuring Your Camera Gear
A Partial Guide
by Norbert Wu

Second Update, August 23, 2015:
For the first time in ten years, I had to make a claim for flooded camera gear.  Short story: Rand Insurance, the agent for Chubb Insurance, came through for me big-time.  I've heard for years that Chubb Insurance was among the best insurance companies that anyone could hope for, particularly folks in my business of photography and filmmaking.  My experience with them has been nothing but great.

Here's a summary of what happened.  I was flying a DJI Phantom quadcopter, with a GoPro Hero 3+ Black Edition camera mounted on it.  For some reason, the quadcopter lost power (or lost a propellor) and fell into Puget Sound, 20 feet away from me, in 12 feet of salt water.  It was not a good feeling.  I have not lost or flooded a camera in many years.

Like all accidents, a series of small mistakes led to a big one -- the drowning of my camera and quadcopter.  I was in a rush to film my nephews who were kayaking in Puget Sound, so even though the Phantom told me that it had not collected enough GPS satellites to return home if battery power became critically low, I ignored the warning.  I had flown this drone a few hours and was over my careful beginner stage of flying, and into the more dangerous zone where I actually felt more confident of my ability to steer the drone.  I had flown the drone earlier in the day with no problems.

I ended up having a great time flying the drone over my nephews.  The first-person-view (FPV) gear that I had installed on the drone was working OK, and so I let the drone get too high.  When a drone gets too far away, it is near- impossible to see the direction it is going.  The only way to see is to lean on the controls and attempt to see how the drone responds.  I had a few adrenaline-releasing seconds where the drone got much too close to my neighbor's huge cedar trees.  I got the drone away from the trees, but as I brought it home, the drone suddenly vibrated a bit and then dropped straight into the water in front of me.  Ouch!  I either ran out of battery power (which I don't think was the reason) or a propeller fell off the drone.  When I recovered the drone the next day at low tide, one of the props was missing, which leads me to suspect the latter reason for the failure.

 I gave Rand Insurance a call.  Rand is the agent that issues the North America Nature Photographer's Association (NANPA) insurance policy.  It's a great camera equipment insurance policy, and I've had it for perhaps 20 years.  My experience could not have been better, and the following describes some of the issues that I raise in my article on photography insurance below. 

I periodically send Rand a list of my gear along with the value of that gear.  For instance, my DJI Phantom was listed at $600, which is the price that I purchased it for.  When the Chubb Insurance representative talked to me, she asked me to send in quotes for the equivalent gear.   My Phantom model was no longer made, so I sent in a quote for the model that was currently available.  This model sold for $900.  Because Rand/Chubb provides replacement value for listed gear, they paid me $900 to replace my $600 quadcopter.  This way I could buy the equivalent model of drone for my loss.  Needless to say, this is impressive -- and what you should look for in an insurance policy.  In other words, let's say this is a car insurance policy and you've insured your brand new 2015 Honda minivan which you purchased  for $30,000.  The minivan is somehow damaged beyond repair.  You cannot find another 2015 Honda minivan in the same condition, so you send your insurance agent a quote for the closest equivalent Honda minivan that you can find -- a 2016 model that will cost $35,000.  Your insurance company does the right thing by you and sends you a check for $35,000 so you can replace your damaged vehicle with another vehicle that is the closest replacement that you can find.  I have to say that this is just superb, awesome service.  Thanks, Rand and Chubb. 

A friend recently recommended Divers' Alert Network EQUIPMENT INSURANCE PLAN to me.  I decided to give this insurance a pass.  Among the things that I found objectionable with this plan were the following clauses:

First, the rate for this insurance, from my calculations, is about 3.5%.  In other words, if you insure $10,000 worth of gear, then the premium will cost $350 per year.  There is a minimum but it is difficult to ascertain from their website, which simply asks you to enter the value of your gear and then comes back with their premium cost. 

(Rand/Chubb's insurance is lower, at 2.45% annually on the value of the gear insured.  )

This clause is a bit unfair: The premiums are fully earned, meaning there will be NO REFUNDS if the policy is cancelled before the Insurance Certificate expires or if there is a reduction in coverage due to sale or loss of an item. 

(Rand/Chubb's policy allows me to remove or add items to my insured list at any time.  They will even send a refund check if my total after removing items results in a lower total amount being insured.  )

And beware of this clause from Divers' Alert Network EQUIPMENT INSURANCE PLAN: 

We DO NOT provide coverage for items that are lost underwater while you are diving, that fall off the back of the boat, or are swept overboard. 
OK, I can live with this, and I am glad that this omission is clearly stated. 

I found this last clause to be very objectionable, and to be hidden in the fine print:

$100 unless claim is for water damage. In the case of a water damage claim, the deductible will be the greater of 10% of the claim or $250.
 This clause, frankly, stinks.  Let's say you flood a camera housing with a $3000 Canon or Nikon camera in it, and a $1000 lens.  You are able to save the camera housing, but the $4000 in camera gear is a loss.  If you have this insurance policy, you will get back (hopefully) $4000 minus the deductible, which will be the greater of $250 or 10% of the value of the loss, which in this case will be $400.  Therefore, you will get back $3600 from this insurance company at most -- and I bet you will get less. 

(I don't want to repeat myself, but the NANPA/Rand/Chubb policy will send you a check so that you can truly replace your camera gear -- even if that amount is MORE than declared on your policy.  They do have a $250 deductible). 

I'd like to say that I am just a "regular" customer of Rand Insurance.  I have not been paid in any way, shape, or form for the above recommendations. 

Update, June 17, 2015:
This is one of the most popular articles in my blog.  My blog has had over 124,000 pageviews in its  history, and this post has had numerous comments and over 3800 pageviews.  Thanks for reading my blog!

I've recently had to do renew my insurance policies, and to seek out new coverages for changes in my life.  I've discovered more than ever that a good insurance agent can help you cut through all the jargon and misconceptions to find you a good product.  Some of the agents mentioned in this article are still around, but some of them are now gone.  Please be aware that this post is almost six years old, and that some of the companies and policies have changed.

I've most recently been impressed (and have been impressed in the past) by the service and professionalism of two insurance agencies that I regularly work with.  They are:

Athos Insurance Services
P.O. Box 61102
Pasadena, California 91116
contact: Katherine Wong
Office: 626-716-9800
Mobile (text): 626-379-6280
Athos Insurance can issue policies for camera and video gear, production insurance, and other insurance needs.  They have an online platform for specialty programs. 

Rand Insurance
50 Locust Avenue
New Canaan, CT 06840
phone number: 203-966-2677
fax number: 203-966-7355
Rand Insurance issues an insurance policy for members of the North American Nature Photographers Association (NANPA).  

Insuring Your Camera Gear
I didn't use to like insurance companies. I didn't like the way that they could raise your rates whenever they felt like it, I don’t like the way they could cancel your policy whenever they felt like it, and I didn’t like the way that they seemed to be able to weasel their way out of claims by quoting fine print which no normal person has the time or expertise to read. So I must include a disclaimer with this article: use the information in this article only in a general sense. Insurance companies and policies change frequently. It is your responsibility to read and understand your specific policy. This article cannot possibly substitute for a careful reading of an insurance policy and the advice of a good insurance agent, lawyer, and accountant.
I like my insurance agents very much, however. I like my agents because they are honest, reliable, and professional. They are patient with my questions, give me honest answers in simple language rather than jargon, and have helped me find insurance for my film productions. Without a good insurance agent, I could never have gotten my first film production off the ground.

What to Look For:
If I am insuring my cameras, I want them to be protected against all risks, including any kind of theft and damage, worldwide. If I lose a camera, I want the insurance policy to replace the loss so I can buy another camera that is of equal or greater value. For instance, if I lose a Canon EOS-1 camera, I want my insurance policy to pay enough so I can buy another brand-new EOS-1 camera. This is called replacement value. The alternative, actual cash value, will only pay you the value of your EOS-1 camera minus the depreciation value. If you lose your five-year-old EOS-1 camera, the insurance company may well only pay you a cash value of $500 (what they say the depreciated value of your five-year-old camera is) minus the deductible. The deductible is simply an amount ($250 or $500 are common amounts) which is applied to a loss and deducted from the payment you are to receive. In our above example, with a $500 deductible and a loss valued at $500, you would receive nothing for your loss. The greater the deductible, the less your insurance should cost.
Perhaps the most important items to look for in an insurance policy are exclusions. Exclusions are situations in which your insurance does not cover your gear. For instance, one photographer recently had his gear stolen from a rental car. His insurance company refused to pay, stating that the policy excluded theft from a rental vehicle! The more exclusions in a policy, the less likely it is to cover you when you need it.
When you sign up for insurance, you will need to make a list of your gear which includes the serial numbers, the date purchased, the price paid, and the present-day value of the gear. In the event of a loss, you will have to provide a proof of purchase, such as a receipt or the page from the camera manual. At that point, the difference between a replacement or cash value policy becomes very important. Some companies actually call a stated-value policy a replacement policy, which is a misnomer. A stated-value policy will only pay you the value that you have listed and paid for. In fact, most “replacement” policies are actually stated-value policies, which seems fair to me. For instance, if you listed the value of your EOS-1 camera as $1500, and you have been charged an annual fee of 2.5% to insure that camera, it seems only fair that the insurance company will pay you $1500 for that camera if it is lost.
In summary, the main things that I look for in an insurance policy are all risk, worldwide, replacement or stated value, low deductible, and few exclusions. Any situations in which the gear is not covered lowers the value to you of the insurance policy.

If you are not a professional photographer and you do not use your cameras commercially, you can insure your personal camera gear on your homeowner’s policy under a “floater policy.” Some insurance companies have floater policies for renter’s insurance. A floater policy allows you to insure your gear by paying an additional amount per $100 worth of gear that you are insuring. It is a “listed” policy; that is, gear is not insured unless you have specifically listed it on the policy. You can also list jewelry, computers, and other gear on this policy as long as you do not use the gear for business or commercial purposes. Be careful that the floater policies cover use of your gear worldwide and against damage. Some policies only cover loss of the gear while in your home! For instance, if a camera is stolen out of your car, a homeowner’s floater policy may not cover it.

Commercial Policies:
If, however, you use your gear for business, you will need to look for another policy. Many companies offer an “Inland Marine Policy.” These policies are not popular with insurance agents, since they are so far-reaching. However, with persistence and the right agent, you will be able to find one of these policies. The Hartford Inland Marine Policy is a good one. It is an all-risk, worldwide, stated-value policy that can cover any type of camera gear. Hartford’s rates are very reasonable, but they do increase substantially if you make a claim. One photographer’s rates went from 1.41% to 2.5% of his stated value ($250 deductible) immediately after he made a claim for gear stolen from an airport.
If your insurance agent cannot, or is unwilling, to set you up with the Hartford Inland Marine Policy, try an insurance broker. I found my agent through the Yellow Pages; he handled policies for many different companies, and he eventually was able to set me up with a Hartford Inland Marine Policy after a bit of searching. He stated that Hartford was reluctant to issue these policies since they were so broad.
If you are a member of a photographer’s association, then you may be able to benefit from the association’s insurance package. For instance, American Society of Media Photographers (ASMP) members have the option of purchasing commercial insurance from ASMP’s insurance partner, Taylor & Taylor. However, as a nature photographer, I have found the rates from most association companies to be more expensive than I need. The problem is that these companies may include other sorts of mandatory types of insurance for photographers who own or use studios--which I, as a nature photographer, have no need for. Such types of insurance include liability, office equipment, lost or damaged film, or employee liability. For whatever reason, I found Taylor & Taylor’s policy to cost nearly double what other companies offered. Taylor & Taylor’s representatives were also the rudest and least customer-service-oriented among the companies I called; I had to call them three times to get answers to my questions, and they never once called me back despite promising several times.
I was also sorely disappointed in the National Press Photographer Association’s insurance partner, Gilbert McGill Insurance, who offers an Inland-Marine professional camera equipment floater through St. Paul Fire & Marine. This policy only covers equipment losses in the US and Canada! The deductible is a high $1000 for theft and $500 for all losses other than theft; and the insurance premium is higher than other policies which offer far broader coverage and lower deductibles.

Kudos goes to the Professional Photographers of America (PPA) who offer insurance policies which offer the lowest rates surveyed. PPA’s insurance partner is Alfred P. Wohlers Company. They offer a plan with a low $100 deductible and among the lowest rates among the companies surveyed. The downside is that you have to pay for PPA membership, which mean you must pay the annual $225 membership dues and have to put up with the magazines and junk mail directed to PPA’s members, who have traditionally been wedding photographers.

I wish I could recommend APA's insurance, but I can't.  I insured my stills and video gear with APA's insurance partner for four years, until it came to my attention that their policy did not cover video or motion picture gear -- only still photography gear!  I had insured my video gear with these guys for three years and paid $1500 for the privilege!  Needless to say, I never got a refund for the fact that I had been insuring gear that they never covered -- and never bothered telling me.  Things may have changed there.  At the time of this writing, APA’s insurance partner is Fireman’s Fund, which offers a $500 deductible, reasonable rates, and other insurance such as $1 million liability location, $100,000 fire and legal , $3000 portfolio, and $5000 property of others.
After reviewing many different companies, I’ve gone with the camera insurance offered through the North American Nature Photography Association (NANPA). Their insurance agency is Rand Insurance, and the policy is offered by Chubb Insurance. The contact information is below.

Questions to Ask:
After researching nearly ten different insurance companies and policies, I developed the following list of questions to ask.

1. All risk, underwater? Is the policy an all risk, all perils policy? I use the gear professionally as an underwater and wildlife photographer. Will my gear be covered if it is flooded, lost, or damaged underwater? Will it cover my camera if it is flooded underwater from my mistake? From causes other than my mistake?
Some answers that I received were enlightening. For instance, the representative at Taylor and Taylor mentioned that my gear would not be covered from flooding if the flooding was caused by lack of maintenance. In this case, she stated, I should just drop the camera in deep water and report it as a loss. The representative at Hoffberger Insurance stated that they simply do not cover underwater gear.

2. All types of gear? Will the policy cover my professional still camera, video, and motion picture gear? APA's policy would not cover my video and motion picture gear.

3. Worldwide? Will the policy cover my gear if used in my home, office, and all countries in the world to which I travel?

4. Replacement value? Will the policy cover my gear for replacement value, agreed value, stated value, or actual cash value (which takes depreciation into account)? There seem to be different definitions of replacement value. Will replacement value pay more for an item that it was listed for?

5. What is the deductible?

6. Covered while being transported? The gear will need to be covered under all circumstances and locations in which it is being used, carried, transported, or delivered. Are there any circumstances in which gear might not be covered if it is being transported by a courier service, while flying as checked baggage, or carried in a taxi, plane, or boat? Will the policy cover my gear if it is stolen out of a rental car, my car, or someone else’s car? Are there any exclusions, such as travel in non-commercial vehicles such as private planes and boats, aerial or watercraft photography, theft from unattended vehicles? What if I put my bag down at the airport and it is stolen?
APA’s insurance had a strange exception, apparently because it was an inland marine policy: gear being carried in a boat in the ocean would not be covered if you were simply traveling on the boat. If, however, you were working on the boat as a photographer, then your gear would be covered. Does this policy have any such exceptions?

7. In case of burglary from a car, will coverage require signs of forcible entry? It’s easy for a burglar to open a car with no sign of forcible entry. If your insurance company requires signs of forcible entry, then you are out of luck if a thief has opened your car with a door bar tool.
The representative of APA’s insurance, Jim Aquilina, first stated that their insurance would cover theft from a vehicle even if there was no sign of forcible entry. Later, however, he stated that the company has recently put an exclusion, requiring a sign of forcible entry.

8. Does the policy have a glass-breakage clause? My camera lenses are composed of glass, so I would want to strike any glass-breakage clause.
None of the companies surveyed had this clause.

9. Are loans of my equipment to friends covered? What if I rent my gear to other parties?
Most companies did not cover my gear if it was rented out to other parties. Hartford covered gear which was loaned to a friend, unless the friend stole the gear dishonestly. For instance, if I loaned my gear to a friend and the gear was damaged, it would be covered. If I loaned my gear to a friend and he steals it, this is considered fraud and is not covered. APA’s insurance does not cover loans of equipment to friends unless they are a legal partner or spouse.

10. Are loans of gear to me covered? What if I rent gear from a store, or borrow gear from a camera manufacturer?
Most companies require you to purchase a set amount of insurance to cover gear that you rent or borrow from other parties.

11. Please let me know of any situations in which the gear would NOT be covered.
Most companies send you a written policy in which all exclusions are listed.

No one likes insurance or paying insurance. However, it is a necessary evil. Hopefully this article will help you compare and find the insurance to fit your needs. Remember to read the fine print, to purchase only the coverage that you need, and to consult with your agent, attorney, and accountant before making a final decision. The right decision -- and the right agent -- will give you peace of mind that is hard to find.

Glossary: Actual cash value: will not pay to replace the cameras completely, but will pay the cost of camera minus depreciation.
Agreed value: will pay only what is listed on my schedule. I need to submit a list of my gear and the replacement cost value each year. If this is not updated each year, then the insurance company will pay only what is listed on my sheet.
Replacement value: The best, and what you should try for, will replace your camera gear with like kind and quality. For instance, if I buy a Nikon N90s at $1000 and it later costs $1500 to replace the N90s or get an equivalent camera, then the insurance company will pay $1500 rather than $1000.
Stated-value basis: not as good as replacement cost. This seems to pay only up to what is listed on a schedule.

For more information:
APA/Fireman’s Fund: (at the time of this writing, their policy did NOT cover video or motion picture gear, only still photography gear!)
Jim Aquilina
Tom Pickard Company
820 Pacific Coast Highway
Hermosa Beach, CA 90254
phone 800-726-3701, fax 800-318-9840,
or phone 310-379-7788, fax 310-379-8946


Rand Insurance
Rand Insurance
50 Locust Avenue
New Canaan, CT 06840
phone number: 203-966-2677
fax number: 203-966-7355

PPA Insurance:
Wohlers and Company


Brandon Harper said...

Thanks for such a detailed article on camera insurance. I've been looking around on the net for stuff and randomly came across your site when doing a google search for a phone number of a recommended insurance agent. Good stuff!

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I found this information to be comprehensive and very helpful. Thanks for taking the time to post it.

Anonymous said...

Thanks for such detailed info! Much appreciated.

Anonymous said...

This is as thorough of a post on photographer's insurance that I've found to date. Thank you so much!!!

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Anonymous said...

Superb article! Thank you so very much for sharing your extensive research and knowledge on this highly-important topic for photographers.

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