Valuable Papers & Records

Valuable papers and records coverage reimburses a business for the cost of restoring physical documents and records damaged or destroyed by a covered cause of loss. Insured items typically include written, printed, or otherwise inscribed materials — deeds, contracts, maps, blueprints, medical or legal files, manuscripts, and abstracts — that are difficult or costly to replace. It is written as an inland marine floater because standard commercial property forms sharply limit valuable papers, often to a token amount that is far below the real cost of reconstruction.

The coverage matters because the loss a business suffers is rarely the paper itself but the labor to recreate what was on it. After a fire or water event, a firm may need to re-survey a site, re-engineer drawings, or manually rebuild client records from scratch. Valuable papers coverage pays those research and reproduction expenses up to the policy limit. It is closely related to, but distinct from, accounts receivable coverage (which addresses uncollectible balances when billing records are destroyed) and electronic data processing coverage (which addresses electronic media and data); many small businesses need all three because they hold value in different forms.

A crucial nuance for buyers is what is not covered and how limits are set. Standard forms generally exclude documents that are electronically stored (that exposure belongs on an EDP or cyber form), as well as money and securities, which need money and securities or a fidelity bond. Coverage may be written on a blanket basis for records generally or a scheduled basis for specifically listed high-value items, and reconstruction costs are frequently underestimated. Buyers should also confirm requirements to keep records in a fire-resistant safe or vault while not in use, since noncompliance can reduce or void a claim.