Resource Library

Property Coverage for Historical Societies

Great Northern Railway train engine under protective shelterDate: April 2021

Historical societies serve a unique function in counties: preserving the places and objects of historical significance to the county for the enjoyment and education of citizens today and tomorrow. Historical societies maintain artifacts, collections and structures as varied as the counties themselves. 

No two historical societies have identical pieces of history to preserve, and each must decide the best way to cover property to meet their specific needs. MCIT encourages members to discuss coverage options with their MCIT risk management consultant, as their particular circumstances may not be addressed in this general discussion.

Unique Coverage Issues

Historical societies are able to choose to cover or not cover certain items, such as some buildings of historical significance and some collectable cars, for example. This is due in part to the fact that MCIT’s coverage does not apply to the historical value of an item.

A coverage provision that frequently applies to historical societies regards the inability to replace historical items with an identical item. This includes many of the artifacts historical societies own. For example, a 2,000-year-old dugout canoe could not be replaced with an identical one. This does not mean, however, that members cannot cover specific artifacts (see Contents section for details).

When discussing coverage with member historical societies, MCIT often hears comments such as this: “If the museum were to burn down, we would not reopen because we would not be able to find replacements with local connections.” Before deciding not to cover a building or contents at all, members should take time to consider the specific issues related to each type of coverage offered through MCIT, and other options available to historical societies.

Buildings

Covering a modern building is straightforward for most MCIT members. The member includes the building on its schedule with a replacement cost value. If there is a covered loss and the building is damaged or destroyed, the building can be repaired or replaced. The same can apply to a historical building. However, without the ability to restore the historic value, it is important that historical societies know how coverage applies when one of their buildings is subject to a partial or total loss, when deciding if coverage is needed.

Most building materials are common and readily available in the marketplace. In the event that damage occurs to property that involves materials no longer available, repair with the material that most closely represents the characteristics of the original material will be covered. Brick will be replaced by brick, tile with tile, marble with marble, wood with wood.

In the event materials are not available, repairs will be considered using materials of like kind and quality that most closely duplicate the original materials.

Examples:

  • If a rare tile that is no longer available is damaged, it will be replaced with a tile that most closely matches the characteristics of the original tile.
  • If a slate roof is damaged, the evaluation of repairs will be based on the cost to repair with slate.
  • If asbestos tile that can no longer be used in construction is damaged, the asbestos tile will be replaced with a material that most closely matches the kind and quality of the asbestos tiles.

“Like kind and quality” does not require materials to be identical. As an example, sheetrock may be used as a like kind and quality material to repair lathe and plaster damage to the interior of a building.

Plumbing and electrical repairs may involve existing materials that do not meet current codes. In this case, repairs would be evaluated based on the cost of replacement with materials that meet current codes.

MCIT’s evaluation of repairs to a damaged building will not consider the antique or historic value of the structure. For example, the rebuilt pioneer-era church would look like the old one after a loss, but it would not be the original.

Given the unique qualities of some structures owned by historical societies, members should consider the merits of purchasing coverage. Structures such as log cabins, shops or saw mills, for example, can be rebuilt but their historic nature will largely be lost.

Contents

Contents coverage encompasses property always kept inside or temporarily outside but within 500 feet of a scheduled building. Because MCIT does not cover the historic value of property, historical societies often opt only to cover contents that can be replaced with new items. Office equipment, office supplies, shelving, tables and displays usually qualify as contents, and an amount should be listed on the schedule to cover all of these items at replacement cost.

Like MCIT’s building coverage, the contents coverage does not consider the antique or historic value of collectible furnishings due to their rarity or collector value. If this type of furnishing is scheduled and involved in a loss, the evaluation will be based on the kind and quality of the material.

For instance if a rare oval-shaped beveled glass mirror from the early 1800s is damaged, the replacement will be based on the cost of an oval-shaped glass mirror of similar dimensions, not the collector value of the original mirror.

Another example could be an antique doll. Following a covered loss, MCIT would pay the replacement cost of a doll with similar characteristics (size, materials, etc.) but will not replace the doll with another antique doll from the county. If a modern doll were part of a display, the member may choose to cover it under contents. An antique doll with no particular local historical significance or value might also be covered under contents.

At the time of a covered loss, MCIT will request a list of items lost or damaged and to be replaced under contents coverage. It is recommended that members keep an inventory of contents from each covered location that will be used to verify coverage. The inventory should list the date and place of acquisition, purchase price and other pertinent information.

Not only will an inventory help at the time of loss, but it will also help in reviewing coverage and allow for more rapid and accurate updates to the amount of coverage. MCIT recommends annual updates to inventories as an annual review of coverage.

Upon request, MCIT offers a fine arts coverage endorsement for scheduled contents at an additional charge. Members desiring coverage for a specific unique item can potentially secure coverage through MCIT pursuant to underwriting guidelines. Each item requires a current appraisal for coverage consideration. If members have questions about covering an artifact, they should contact their MCIT risk management consultant.

Property in the Open (PIO)

Structures or property that are not buildings, such as an outdoor sign (not attached to a building), fencing, gates, benches, flag poles or other items permanently outside of buildings at a scheduled location are considered property in the open. These items must be scheduled for coverage to apply. Statues and monuments are an exception with automatic coverage up to $10,000. If a higher coverage limit is desired, the statue or monument needs to be scheduled with that specific limit.

Some PIO items unique to historical societies include, but are not limited to, historical outhouses, inoperable fire engines, train cars, inoperable farm equipment or other antique equipment. Scheduled property in the open is covered on a replacement cost basis with the same considerations given to like kind and quality discussed under the Building section of this resource.

Inland Marine

For some items that may be used off site, such as mobile displays, coverage may be provided under inland marine, miscellaneous personal property coverage. Items must be scheduled with an actual cash value. This is the physically depreciated value or the current market value of an item (i.e., what one would pay for a replacement item in its current condition at its current age). If an item is eight years old and would typically have 10 years of use, then there may only be 20 percent of its original value remaining.

Members may be able to find approximate current values on the Internet for some items. For more information, see Replacement Cost Coverage.

Although likely not historical items, the computer equipment in the historical society office are best protected by electronic data processing (EDP) coverage. EDP equipment is defined as an arrangement of interrelating electronic components and related accessories that can accept and manipulate data into a desired format or result. Examples of EDP equipment include desktop, laptop and tablet computers, smart phones, servers, hard drives, monitors and network-connected printers and copiers.

Members should include all their EDP equipment on the EDP inventory submitted to MCIT. More information about EDP coverage is in Electronic Data Processing Coverage.

Some historical societies have working thrashers or other heavy equipment in their collections. For most of these items, coverage is offered under inland marine, contractors equipment. This coverage is also provided on an actual-cash-value basis, which includes an adjustment for age. If the thrasher, tractor or other piece of equipment is inoperable and stays in place outside, coverage may be provided under property in the open. Members should contact their risk management consultant if they have questions about coverage for these items.

Automobiles and Motor Vehicles

If the historical society owns vehicles that are operational, they must be included on the automobile schedule for liability coverage to apply when operated on roadways. Liability coverage is required on all licensed vehicles, but members can choose whether comprehensive or collision coverage is needed. If the vehicle is not scheduled, then there is no coverage from MCIT.

Many historical societies have vehicles on display. If the vehicle is operational and is driven, then there must be at least liability coverage on the vehicle when driven to be in compliance with state law. If the vehicle is considered a classic or a collectable and is only operated occasionally to move the vehicle short distances, the historical society is allowed to obtain coverage for these vehicles outside of MCIT. The member would look for a policy designed to cover classic and collector vehicles.

If the vehicle is inoperable and is on permanent display outside of a building at a scheduled location, coverage may be available under property in the open as discussed previously. If the vehicle is inoperable and on permanent display inside a covered building, the options for coverage would be a classic car policy outside of MCIT or possibly under the MCIT fine arts endorsement. Members should contact their MCIT risk management consultant if they have questions about covering historical vehicles.

Questions and Considerations

MCIT recommends reviewing the property, inland marine and auto schedules (found in the MCIT Coverage Document behind the Schedules tab or on the member portal at MCIT.org) for accuracy. Members should check to ensure that everything that should be listed is listed with an appropriate value (replacement cost or actual cash value).

Members with questions about coverage or who would like to discuss coverage further should contact their MCIT risk management consultant toll-free at 1.866.547.6516.

The information contained in this document is intended for general information purposes only and does not constitute legal or coverage advice on any specific matter.