How to Protect Those High Value Property Items That You Own

17 Oct

Collectibles can increase in value over time until they are worth a significant amount of money. This can include a wide variety of collectibles, everything from comic books, wines, cigars, sports memorabilia, movie props, coins, art and jewelry can appreciate over time until they are worth a small fortune. These types of assets really need to be protected by valuable articles insurance. 

What is Valuable Articles Insurance?

This is a separate policy or rider for your homeowner policy that ups your protection for high value property that you own. It offers protection for a wide variety of property and ensures that your high value items are fully protected.

While a standard homeowners policy covers your possessions, there is usually a value cap on most person property. This cap will vary by insurance company but $1,500 to $2,000 is fairly common so if you have collectibles that easily exceed this dollar amount you should absolutely look at a valuable articles policy to fully protect your collectibles. 

In addition to value caps, many homeowner policies won’t cover issues such as a mysterious disappearance of items such as a gemstone. As an example, if the diamond falls out of an engagement ring and the owner did not realize it at the time and has no idea where it is, homeowners insurance may deny the claim, however the loss would be covered by a valuable articles policy.

“Valuable articles insurance covers most causes of loss at home and across the globe with no deductible,” said Charlie Graham, with Orchid Insurance Graham in a recent Insurance Business Magazine article. “It’s a flexible coverage option that can meet the unique needs of the individuals. Covered ‘valuable articles’ can really run the gamut from a classic collection of PEZ candy dispensers, to a pair of inherited diamond earrings, to silverware, golf clubs, artwork,” continues Graham.

These policies are highly customizable, you may want coverage for only one very high valued item or a number of items that have a lower value, coverage is completely up to you. In addition, if your collectible has increased in value since you purchased the policy, it may pay out additional coverage if you have to make a claim. Some policies will pay up to 150 percent of the insured amount if the item has increased in value since the policy was put in place. This can vary by policy so make sure you ask about details before purchasing a policy. 

Getting the Value Right

When it comes to a valuable articles policy you can usually choose between a couple of coverage options:

Agreed Value: This type of policy will pay out an agreed upon value if you have to make a claim due to the item being lost, stolen or destroyed. You and the insurance company will come to an agreement on the value of your property. In most cases, a professional appraisal will have to be done to support the value of the item. These types of policies are usually reserved for very high value items. 

Market Value: This type of policy will pay out the market value of the item at the time of loss. This type of policy is usually more affordable and will look at the market value of your item at the time you make a claim. The insurer will determine a value after researching what it would cost to replace the item in the current market. 

It is important to get regular appraisals on your high value items, especially ones that can escalate in value such as gold, large diamonds, artwork from popular artists and even certain wines. If your collection is growing in value, regular appraisals and insurance adjustments will make sure your high value items are fully protected. Many valuable property insurers offer appraisal services to their clients. 

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