“Many people are familiar with the concept of insurance coverage in the context of car insurance or travel insurance, but knowledge about insurance coverage of personal property such as fine art or antiques is much less widespread. In my own appraisal firm, I answer many questions from potential clients who are unsure if they need an insurance appraisal report or what the process is to get one. I’ve written this article as a general guide to help empower consumers with knowledge about insurance appraisal reports. It incorporates many of my most frequently asked questions and answers. This guide is designed to help readers determine whether they really need an insurance appraisal report, and if they do, what the typical process is for working with an appraiser to have one prepared.
The world of personal property insurance is filled with all sorts of fun vocabulary like ‘inland marine policy,’ ‘blanketed,’ and ‘rider,’ none of which really make any sense unless you work in the field and are familiar with their specific meanings. I’m going to get to all these terms and define them later, but the very first thing I always recommend in my conversations with potential clients is for them to pull out their current insurance policy and check the coverage. Some homeowners policies can already be sufficient for strong coverage of all items in the house, and a written appraisal report for itemized coverage may not be necessary. The best first step is to confirm what coverage you already have.
Sometimes clients can’t find their policy documents or may not have ever received the full paperwork describing their specific coverage details. In those instances, I recommend they call their agent or local insurance office to ask what their policy covers and confirm their current level of coverage. In my experience, the insurance agents are very pleased to hear from the clients and will take time to explain what their current policy covers and what options they have for adding to it. Even if the potential client finds out an appraisal is not needed, it makes me happy as an appraiser to be able to help. The client now has peace of mind of knowing they are already well-protected and don’t need to move forward with engaging me to prepare an appraisal report.
If you find you do need an appraisal report, how to get one? I recommend searching for an appraiser who is USPAP-compliant and who has a strong connoisseurship background in the types of items you need to have appraised. The “Find a Member” search tool on the websites of the major professional organizations for appraisers (International Society of Appraisers, Appraisers Association of America, and American Society of Appraisers) can help you locate an appraiser whose service area is close to you.
Insurance agent Andrew Elliott, CLU states, ‘In our office, we highly encourage our clients to obtain appraisals for high-valued items or even sentimental pieces passed down through family generations. Whether the item be jewelry, fine art, or antique furniture having a detailed appraisal report allows our clients to feel comfortable with their insurance policy coverage and provides guidance when there is a claim. If no recent appraisal exists after there is a loss such as a fire, then it is very challenging for the property owner to replace or restore the item(s) and the insurance company to settle their claim. If you have questions or would like us to review your options for coverage with our office then please feel free to reach out by email to andrew@myfairfaxinsurance.com.’
After checking their policy documents or talking with their insurance agent, if clients do need a written appraisal report to obtain an appropriate level of insurance coverage for the art, antiques, and other personal property in their collection, when they call me the next step I recommend is to find out what their scheduling threshold is. A ‘scheduling threshold’ is another insurance world phrase that can be confusing, but what it basically means is the amount of money an item must be worth to require that an insurance appraisal report is needed to protect it with insurance coverage. Any item that falls under a scheduling threshold could be protected with blanketed coverage based on the property class or scheduled individually at its value without an appraisal requirement. Sometimes, the insurance company could use a detailed receipt or invoice for an item to schedule it at its valued amount.”
