Protecting Antiques is More Than Just a Sentimental Journey

With the surge of reality-based programs such as Antiques Road Show and networks like HGTV gaining popularity, many homeowners are pulling out grandma’s old rocking chair from storage or taking a second look at a set of cookie jars purchased at a local estate sale in hopes that their treasures may actually be worth a small fortune. Regardless of whether your client’s antiques hold mere sentimental value or monetary significance, it’s important that those items be properly valued and protected.

Options for Insuring Antiques

Ultimately, homeowners will purchase coverage based on their individual situation and risk threshold. Clients who cherish their antiques should consult with an agent or broker to discuss coverage options. Because antiques fall under the fine arts category, a variety of affordable options are available and homeowners can usually obtain a $100,000 policy for approximately $150 annually, depending on their insurance carrier.

Many clients believe their antiques are covered under the personal property provision of their homeowner insurance policy. While this is true, without separate insurance, antiques are simply included with all other home contents and subject to the policy’s deductible. Under normal contents provisions, all personal property, including antiques, are covered under the policy limit, so no specific value is assigned to individual pieces. Therefore, in a loss situation, when the policy limit is exhausted, that’s it.

A client with only a handful of antiques that have little monetary value may decide to leave them under the homeowner policy provisions. Clients with a rare item or clients whose antiques collectively have a significant dollar value should consider three options:

• Scheduling — By scheduling, the homeowner is able to itemize antiques and their value, ensuring that loss of those items will be paid based on the assigned value. This approach eliminates questions about the value at a time of loss and usually has additional coverage built in for newly acquired items.

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• Blanket Coverage —Another option is blanket coverage. These policies allow homeowners to collectively insure antiques without itemizing them, but cap the maximum value of each item. For example, a homeowner may decide to purchase blanket coverage of $100,000 for an antique collection as long as there are no individual pieces in that collection valued at more than $10,000.

• Combined — Clients with large collections may decide to combine scheduling with blanket coverage. In this case, clients could purchase blanket coverage for the majority of a collection and schedule individual items whose value exceeds the per item limit noted in the policy.

Some providers will allow homeowners to lower their personal property insurance and include blanket coverage or schedule. This is also a cost effective option that allows broader coverage without a deductible.

Priceless antique or worthless heirloom?

Many clients collect antiques as a hobby or for investment purposes and have a clearer understanding of which items have great monetary value. For others, antiques evoke a strong emotional attachment, making it difficult for them to gauge which items should be insured.

For example, an antique appraised at $100 may be deemed by the client as priceless if it has been handed down by a family member or triggers a fond memory. As insurance agents or brokers, it is our responsibility to assist clients in the valuation process by counseling them on ways to differentiate items with sentimental value from antiques with monetary value. Generally, clients should insure antiques that are one-of-a-kind, irreplaceable or items for which it is difficult to determine their value.

To start the valuation process, homeowners must carefully review their personal property and perform a household inventory. If they think an item is valuable, clients may do some initial research by contacting professionals who monitor the appreciation of similar items. Based on that information, homeowners can decide which items they want to consider scheduling.

Placing a monetary value on each item is necessary to ensure that clients select the right insurance options. Professional appraisers can be hired to examine antiques and assign a value. This is especially helpful for old or rare antiques. Clients may also choose to use the Internet to research values or talk with antique resellers to determine the value of their particular antique. Avid collectors with unique items are another resource as they often keep track of similar type items and understand some of the increases which take place. Generally, the value of antiques should be reevaluated every three-to-five years, especially if the items are rare.

In a loss situation, nothing will replace an antique or the feelings associated with that particular item. However, helping clients work through their sentimental journey to properly value and insure their antiques will provide clients with some peace of mind that the value of these irreplaceable assets is protected.