Whether you collect stamps, antiques, or fine art making sure you have additional coverage beyond your homeowners insurance policy makes financial sense.
That’s because most policies set coverage limits, even for “normal” items.
Dollar amounts aside, a simple “replacement clause” in your policy is hardly sufficient to cover your most valuable possessions for loss or damages, especially one-of-a-kind items.
What’s more, just because you think you’re properly covered for the full amount doesn’t mean that you are, necessarily.
And that was certainly the case for my friend, Charisse.
Three keys for insuring your prized possessions
About four years ago she was traveling with her husband (now ex) out west. During their trip they made a planned stop in Vegas for a couple of days before continuing on to Napa.
One morning while at the hotel pool she noticed that her engagement ring was missing.
I’m sure you can imagine just how upset she was. To make matters worse her engagement ring was an antique — a family heirloom that had been passed down for at least four generations.
Frantic, she searched everywhere for it, back-tracking her every move. Unfortunately she never did find the ring, and losing it spoiled the rest of the trip for her.
But it gets worse.
When she finally realized that her ring was gone for good she phoned her insurance agent to file a claim for the ring. In fact, a few years earlier she had purchased additional coverage just for the ring because of its value. During the call the agent tells her not to worry because she’s covered for loss, along with theft.
Feeling a bit better she finished up her trip in a better mood, though obviously upset about losing her priceless heirloom.
So you can imagine her surprise when she gets a check for $10,000 from her insurance company.
Mad, upset and a bit frantic to figure out what happened she calls her agent again… and he calmly pointed out that the check she received was for the coverage on her ring, less the deductible. That’s when she told him that the ring was worth 10x that amount. It was worth 100k, not 10k. Didn’t he bother to look at the appraisal value when writing the policy to cover the ring?
Through no fault of hers she assumed the agent was competent.
Even though he was a long-time family friend he dropped the ball, and it was too late now to do anything about it.
However, by following these three keys you can make sure that you have the proper amount of insurance coverage for your fine art, antiques or other collectibles:
- Annual appraisals
- Proper documentation (including photos, etc.)
- Annual insurance reviews to properly update your coverage limits and possible deductibles.
Getting an appraisal at least once a year is a must.
And when it comes to fine art this is especially true. Once an accurate appraisal is done (make sure the appraiser is qualified to do appraisals for insurance purposes) your next step is to get proper documentation.
You might also consider using a photo or video log as evidence of ownership.
And then keep this documentation in a safe place.
Armed with this information make sure your agent schedules an annual insurance review (phone or in person) of your policies to make sure that you are properly covered. And then have a hard copy of your updated policy sent to you (or delivered) so that you can verify the coverage amounts for each piece of art, antique or piece of jewelry that you own.
Does that make sense?
After all, it’s bad enough to lose your prized possessions on an emotional level. It’s quite another thing to discover that your loss (a real asset) is not adequately covered — financially speaking.
So what happened to my friend Charisse?
She fired her agent and found a company that provided her with more personal service than the previous guy. And when she asked her agent (prior to firing him) why they had never scheduled an annual insurance review, his answer was that he had “too many clients.”
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After all, having the right coverage does more than provide you with peace of mind.