Key Factors Affecting a Client’s Collectible Insurance Cost
Americans love to collect – from fine art to antiques, couture, sneakers, trading cards, coins, stamps, and pop-culture collectibles like action figures and toys, comic books, and graphic novels. People collect for various reasons, including a passion and love for valuables, investment purposes, emotional and nostalgic value, and to preserve cultural history.
Protecting one’s investment against damage or loss with a Private Collectibles insurance program is critical. The policy covers accidental breakage and damage, including during transit, and damage from fire, smoke, and location-dependent, may cover natural disasters and water. It also covers loss from theft and mischief.
The Cost of Coverage for Collectibles
Two major factors impact the cost of Private Collectibles insurance: the nature of the collectibles and how they are stored.
The Nature of the Collection
To help determine the insurance cost of a collection, underwriters will look at its nature and value, including the number of items, material, age, and fragility. They examine whether the collection consists of one very high-valued item (such as a painting) or several lower value items. Smaller items, such as sneakers, are easier to steal than something larger and more difficult to move. Collectibles like coins and silver are also easier to steal and have a melt value in addition to their historical value.
On the other hand, if stolen, fine art is relatively traceable and easier to recover, which is a factor in the insurance cost. Fine art is also typically easier to restore and doesn’t usually represent a total loss if damage occurs. You can repair a painting damaged by mold or fix a chipped sculpture. The items may not be restored to their full original value, but the policy will pay for the restoration and any subsequent loss in value. If, however, the leather on a sneaker in a collection is damaged, you most likely wouldn’t repair it. It’s more effective to call it a total loss and replace it with a like item from the market.
Some valuables, such as textiles and wine, can be impacted by environmental factors, including temperature and humidity. Fragile valuables, like porcelain, will be priced at higher insurance rates. The age of the items in a collection also affects the insurance cost.
How Collectibles Are Stored Comes into Play
Another factor that impacts the insurance premium for collectibles is how they are stored. Collectibles may be on display, stored at home in a safe, or at an off-premises storage facility. Underwriters will assess how well protected the items are. For example, is there a centrally monitored alarm system, and are small items like jewelry or coins and kept in a safe?
Underwriters also look at the geographic location of the collectibles. For example, certain areas are prone to natural disasters such as wildfires, hurricanes, and other hazards that increase the risk profile of the collectibles. If the insured’s home is close to water or in a flood zone, this might not impact the price, but the policy may include exclusions or restrictions. A stillage warranty requiring collectibles to be stored several inches off the ground may be part of a policy’s coverage terms and conditions. For example, wine stored in the basement must be properly protected to prevent water damage. Collectibles stored in cardboard boxes must also be kept above floor level. An inch of water from a burst pipe or other flood disaster can destroy an entire collection.
Other factors that impact insurance rates include the coverage amount and deductibles.
Get Started with Distinguished Today
Distinguished Private Collection insurance program offers worldwide protection for insured items. We can write coverage on a schedule basis, determining the values based on the purchase price or appraisals. We also offer coverage on a blanket basis. For blanket limits, we’ll typically assign the current market value to those items at the time of loss, with a maximum per-item limit.
To access our insurance program for a client’s collectibles, just register with us and then fill in and submit an application form. With the application, please include a schedule of covered property and any appraisals or invoices you may have.
If you have specific questions about our policies, please feel free to contact our support team or explore our Private Collection Insurance program page for more details.
About Distinguished Programs
Distinguished Programs is a leading national insurance Program Manager providing specialized insurance programs to brokers and agents with specific expertise in Fine Art and Collectibles, Environmental and Construction Professional, Executive Lines, Inland Marine, Real Estate, Community Associations, Surety, Hotels, and Restaurants. Property and Liability products are distributed through a national network of agents and brokers. Serving the same core markets and partnering with the most stable and reputable carriers, Distinguished’s high-limit Umbrella programs remain the clear choice in its area of specialty for superior coverage, competitive pricing, and attentive service. Through thoughtful innovation, stemming back to 1995, Distinguished Programs fosters growth and opportunities for its brokers, carriers, and employees.
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