Insure Your Collectables The Correct Way


As the art market has grown in size, scope and value, insurers have stepped in to take advantage of the growing market as well. Major insurers now cover an array of valuables including paintings, sculpture, jewelry, antiques, stamps, coins and fine wine.

"There's a limited number of cars and homes out there, so insurance companies are creating specific products for very specific needs," says Jeanne Salvatore, spokeswoman for the Insurance Information Institute.

The niche-insurance market is growing quickly, according to Salvatore, especially for fine art. As an example, AIG's AIG fine-arts division has had a "very healthy" annual growth rate of about 30% in recent years, says Katja Zigerlig, director of fine arts at the insurer's private-client group.

Here are some tips insurers offer to keep your prized possessions in top shape:

Know the people you let into your home.

When things go missing, it's usually an inside job, according to insurers. Whether housekeepers, roof contractors or party guests, those who steal your stuff have usually been in the home before and know where to find the goods. Keep your valuables locked up if you're having major renovations or a party with unfamiliar guests. Make sure to do background checks on hired help who will be spending a good amount of time in your home.

Get the right kind of anti-theft system.

It might sound too "James Bond" to be true, but there are laser security devices and tiny locator tags developed just to prevent theft and discover where your valuables end up if they get stolen.

Make sure housekeepers know how -- and whether -- to clean your valuables.

Accidental mishaps frequently occur when those hired to tidy up a home start tidying up the 19th century painting as well, says Theresa Lawless, director of fine art and collectibles at Fireman's Fund InsuranceAZ.

"A lot happens with 'The maid did it' or 'The butler did it,'" she says. To avoid such situations, be specific about what items should not be touched and what items have specific cleaning instructions.

For wine collectors, temperature is key.

Make sure to have a backup generator in case a power outage shuts down your wine coolers.

If you insure, pick the right policy.

Itemized coverage makes sense if you have a few paintings, but wine collectors are better off with a blanket policy, since the collection is constantly changing. It's also important to make sure that new items are covered at the time of purchase, in case of any damage on the way home from the gallery or shop.

If you've got art at home in the U.S. as well as the vacation home in Tuscany, make sure the policy covers your works abroad. In addition to AIG and Fireman's Fund, AXAAXA, Chubb CB and several other companies offer policies for valuables.

If you're already insured, update appraisals.

Since art values have escalated, you may need to escalate your coverage in case of damage or theft.

One can't "overstate the importance of getting updated art appraisals," says Zigerlig.


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