When it comes to insuring the items in your home, rental insurance or the standard homeowners insurance typically covers everything you own: from furniture, to clothing, to electronics.
But what if you’re in possession of paintings, trading cards, or other valuable collectibles? In this case, you might need an additional insurance policy to safeguard your prized items from the risk of theft or damage. Curious to learn more about insuring art and collectibles? Keep reading!
What’s Your Current Policy?
Typically, a renters or homeowners insurance policy limits how much coverage is available for items like jewelry, fine art and collectibles. Even if your insurance payout goes up to $100,000, a much smaller figure—around $2,500 is typical, although this varies widely—applies to these valuables.
If you are storing artwork or other collectibles in your home, it’s important to get in touch with your insurance company to understand exactly how much coverage you already have for your collection. This is also a good time to ask about any other policies related to art and collectibles; for example, some policies don’t cover damage to art if it’s outside the home, i.e. on loan to a gallery. In addition, check on the requirements for collectible safekeeping, as some insurance policies require that art and other valuables are stored in a certain way in order for an insurance claim to be paid out.
Do You Need More Coverage?
There’s no simple answer as to how much insurance you need. Many people who collect art or other items have made a sizeable financial investment, and in addition may find a good deal of emotional value in their collection. It’s also possible that these collectibles are intended to be passed on to future generations. In all of these cases, insuring the collection to its full market value, or at least as close as possible, may be a smart move. Depending on your current homeowners or rental insurance, this may mean adding a rider to your existing policy or purchasing a new one.
Rider vs. Brand New Policy
If you’re already happy with your insurance but want additional coverage for artwork and collectibles, you may be able to add a rider to the policy. A rider means you pay a higher premium to receive more coverage for certain items. Get in touch with your current insurance provider to see if an art, collectible, or high-value rider option is available.
While adding a rider to your current policy is usually the simplest and least expensive option, if collectibles an important part of your life or financial planning, it could be worthwhile to investigate a new policy specifically designed to protect your valuables. Collectibles insurance can offer additional benefits over a rider alone, including inflation-guarded protection, coverage for items that are loaned out to other locations, and automatic coverage for new additions to the collection.
Other Ways to Protect Your Valuables
As you investigate the right insurance policy to protect your art and other collectibles, it’s a smart idea to have the collection appraised by a third-party expert. Even if you’re fairly confident that you know the value of the items, getting an expert involved will ensure that if the worst should happen, your investment is protected to the full extent of its worth. An appraisal company can also help to do an inventory of items and take pictures. Whether or not you’re working with a professional appraiser, you should still make your own list of art and other collectibles, including what items are in the collection, when they were acquired, and from where. Include pictures, then keep this information in a safe and accessible location, preferably online.
