An artwork collection or antiques can be of immense value for the owner- both aesthetically and financially. But replacing or repairing precious items could be expensive if one does not have a current market valuation for insurance purposes.
Getting a valuation right for insurance purposes can be quite a challenge for owners, and Experienced Public Adjusters™ is here to help when insurance companies don’t get it right.
Owners have two options when it comes to insurance of their items
- An agreed value basis
- A current market value basis
Both variations will allow the client to insure the most common risks such as physical loss and damage. Policies typically pay for the cost of restoration if the item is damaged, or sum up to an agreed policy limit if it is lost or stolen.
The type of valuation depends on the size of the collection and other factors such as fragility, sentimental value, whether there is professional management of the collection, and how relaxed the owner is about absorbing any financial loss above a policy’s limits.
Making sure that values don’t fall too far out of step with the market, requires diligence the owner.
If you have a contemporary collection where prices tend to be more volatile and fluctuate, you must revisit your valuations every three to five years.
Insurers will accept reappraisals that are performed third parties, such as an auctioneer, a specialist art dealer, or any recognized expert.
Owners have to either transport the items for reappraisal or arrange for on-site viewing.
In general, these situations on behalf of the owner can be quite cumbersome in terms of time and money, but this diligence is important.
If you have a claim, the more information you have about the damaged items- a description of each, the date and place of purchase, etc., the faster the claim can be settled. Videotape or take photographs of rooms and their contents. Note where and when you bought each item. Write down the brand names and model numbers of appliances and electronic equipment. Add new items as you buy them. Keep receipts with the list.
Be sure you store your home inventory somewhere safe, off the premises, in a bank deposit box or with a neighbor or relative, so that it isn’t destroyed if your home is damaged.
Estimate the value of your personal possessions at current prices.
The total is the amount of insurance you would need to replace the contents of your home with new items if everything was destroyed.
Find out how much insurance you have for the contents of your home in your homeowner’s insurance policy.
Most companies provide coverage for 50 percent to 70 percent of the amount of insurance on the dwelling. Now compare the personal property limit with the total value of the items on your list of personal possessions. If you think you’re underinsured, discuss this problem with your insurance agent or insurance company representative.
Replacement cost insurance is pretty simple once you cut through the jargon and have the right advice.