Insurance for special collections

When it comes to insuring special treasures, most people can make do with a rider on their home insurance policies. Depending on the valuables involved, they might be able to get the insurance coverage they need without hiring an appraiser. The best reason to hire an appraiser is to get objective documentation about the value of the items you're insuring. Possessions such as stamp collections, coin collections, antiques, wine collections and fine art are all good candidates for appraisal.

Appraisers generally operate under a strict code of ethics. Seek out an appraiser who specializes in the kind of valuables you own. The American Society of Appraisers, for example, lists appraisers according to their specialties.

“Each accredited member of the American Society of Appraisers has earned a professional designation in one or more specialized areas of appraisal,” says the society’s executive vice president, Edwin Baker. “To receive the accreditation, the appraiser must pass intensive written examinations, submit representative appraisal reports for peer review and be screened for his or her ethical behavior.”

It's important to keep documentation of your appraisal in a separate location, so that you'll be able to substantiate any loss.

Discuss with your appraiser the methods used to determine the value of your items, to make sure the appraisal meets your insurance needs. “Often the distinction between cost and value is lost in the appraisal of personal property,” says Harris Samuels, a senior accredited appraiser in New Smyrna Beach, Florida.  “Value is a measure of the future utility of property. Cost is the monetary equivalent of that property for the purposes of an exchange. Sometimes the two terms are numerically equal, more often they are not.”

Know your policy

Watch out for exclusions in your fine art or collectibles policy. For example, an exclusion called "inherent vice" won't pay for some art objects that will, by their very nature, deteriorate — old canvases, for instance. Other exclusions might include damage to stamp or coin collections caused by fading, scratching, or staining.

The American Numismatic Association offers this advice for coin collectors, who wonder how they should insure their valuable coins: “Note that most homeowner insurance policies specifically exclude coins and other numismatic items from coverage. A rider can be obtained for an additional premium, or a separate policy can be obtained.”  The ANA also urges its members to “Maintain records about your collection and store a copy separately from the coins.” 

Once you've amassed a valuable enough collection, it's likely the insurance agencies that specialize in insuring them will be seeking your business.

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