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How to Insure Antique and Collector Cars for Less and Save Money

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Jay Leno driving up to the Emmy rehearsal 1993...Jay Leno driving up to the Emmy rehearsal 1993 in one of his antique cars, a Hispano-Suiza 8 (Photo credit: Wikipedia)

You may not be Jay Leno, but you may have a similar passion for antique cars!

There's good news - the car may be expensive, but the insurance doesn't have to be.

There are lots of options for Antique cars, and in this category, in our experience we can find excellent rates on insurance - and so should you, because the vehicles are not driven much and are usually very well protected and cared for.

Make sure you check for a specialized insurance company.

For example, the ones we use charge much less than our regular insurers, because they specialize in the antique market.

Agreed Value vs. Cash Value (and Limited Value) - It's not as simple as it sounds.

Be careful.

There are also additional considerations that the specialized markets may offer that are more advantageous than regular insurers, like making sure the coverage you get is agreed value and not cash value.

You have to know where to insure these special vehicles to get the best price and coverage.

Wondering what classifies a vehicle into this category?

Here's a guideline.

  1. Age of vehicle - 25 years or older is usually the ball park. However certain models and vehicles may still fit into the collector car category based on other factors like special features, limited production, etc.
  2. Use of vehicle - Annual mileage can come into play with some carriers, however not all carriers have this limitation. Some insurers will look at if it is used in the summer, vs winter - and others have more flexible guidelines. We have carriers that don't base it on any of this, and others that have very rigid guidelines. It's worth investigating, there are some definite advantages to knowing the options!
  3. Condition of the vehicle - naturally to be categorized as a collector car, it should be in excellent condition. Evaluations are not always required, depending on the insurance provider. We have some that absolutely require an evaluation, however higher end insurers that we deal with, such as Chubb may rely on their internal expertise rather than send the client out for an evaluation. In any case, when you have a collector car, it is recommended to make sure you get an accurate idea of the value from an expert.

Here's a great story from the NCIB, on a collector Corvette that was stolen then recovered 30 years later!



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Valuable Articles #2: Hidden treasures and the question of value.

Some of the most common questions I come across when discussing fine arts or collectibles with a client are :

"How do I know what it is worth?

What do I insure this for?

How much will I get paid in a claim?"

Questions like these are not normally an issue with collectors, but as you are starting out, or if you have never thought about the accumulated value of the items in your home, a discussion about your contents often brings questions like this to light.

Depending on what you know about the fine arts, the answer to these questions ranges from a very simple one to something more complex. 

In the event of a claim, your insurance policy maintains that you must prove your loss in order to receive settlement. What information can you provide or obtain to help make sure you always get a full settlement?

My strongest recommendation is to get an evaluation or use a copy of the purchase agreement or bill of sale to determine the value of what you have. With this, it is easy to insure the item to the stated value. With many insurers, this will lock in the insured value and you will know exactly what the settlement will be in the event of a claim.

The more complex answer comes when you do not have a value, or you do not know who the artist is.

Very often individuals will have things in their homes or apartments that they have inherited, they have created themselves, or that they received as a gift. Cases like these are when assessing the value - or determining what kind of insurance to choose can be tricky. 

What kind of information will be used to determine the value of a piece?  What sorts of questions will evaluators look at?

In the following video by Chubb's Dorit Straus, Chubb's worldwide fine arts manager, discusses the challenges and nuances of underwriting antiques, collectables and fine art. This is a great insight, and I recommend a look.

I recently spoke to some recommended evaluators in the industry about what they might look at if there was a claim, and the insured did not know what value to declare. Here is a sample list of some of the factors an evaluator will look at to determine value, for example, in a fine art item:

  • Have any of the items by a similar artist or creator already been sold? If so, to whom?
  • Are they sold to a personal circle, on a provincial level, or an international level. At the international level the creator or artist may be registered as known. At the provincial level, he/she may also be registered, however it is not mandatory. If the artist is registered, this will help establish the artist if applicable.
  • If the artist sells outside of his personal circle, then the Galleries that represent him/her would be helpful in determining value.
  • Does the artist have an agent? Who else has bought their work?
  • Pictures of the artwork, sculptures, etc. could be used to have an idea of  worth (after a loss when there is no evaluation) but this is not recommended.
  • Size/Dimensions and Materials used in sculptures or art will effect the evaluation.
  • If items are not sold outside of a personal circle, then the receipts for materials used in creating the sculptures are often referenced in determining the value, along with an hourly rate.

All of the information above may become difficult to assess after the fact. You truly are taking a gamble if you do not protect yourself with valuations before a claim occurs. Consider that you can have an evaluator do an appraisal, the estimated cost is usually starting at $75-$100 per hour. An evaluation with pictures will be written up that takes into account all of the above. Note however that an evaluator will not judge the art, for example they will not evaluate the aesthetic quality of the work, but based on the questions above, they will be able to determine a the value for the purpose of insurance.

More and more, people are becoming aware of the hidden values of treasures found in their homes. Shows like Antiques Road Show, and others show us a glimpse of situations where people have items of extremely high value and are not aware. Other times, we see cases where people over estimate the value of certain items. Jeff Domini interviewed in this video from ilsTV.com entitled: Appraising on the Antiques Road Show , discusses some of his experiences.

If you have something you cherish and that you feel you would want compensation for in the event of a claim, your best bet is to have that evaluation done.

Protect your assets. You will be happy you did, especially if what you have is a hidden treasure.

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 For additional information, you may also like: 4 Questions you need to ask: Do you know what your policy covers? (Valuable articles)

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Give me quick & easy, personalized feedback here or be part of the discussion by commenting below.

 

 


Valuable Articles #1: 4 Questions you need to ask - Do you know what your policy covers?

English: Gold Jewelry / Gold JewelleryImage via Wikipedia

Insurance companies have various policy options available for the insurance of valuable articles such as fine arts and jewellery.

Each policy varies, depending on the insurer and type of policy you select. The most important questions you want to ask to help you understand what you need when insuring your fine arts or collectibles are:

1. Is there a limit in the policy for fine arts/jewellery/collectibles?

2. What is the deductible?

3. What type of coverage is available within the policy? Is it all risk? Does it include breakage? Does it include mysterious disappearance? Does it include coverage for newly acquired items? What is excluded?

4. Can I purchase additional coverage? 

If your valuable articles, fine arts or other collectibles are important to you then take a few moments to find out if you are insured properly and how your insurance will protect you in the event that there is a claim.

Insurance companies have special limits in the small print of the policy wording (contract) that limit the amount payable for certain items such as jewellery, furs, fine arts, collectibles.  Depending on the insurer, the limit for jewellery for example could range anywhere from $1,000 to $25,000. More often than not, a standard policy will include coverage from $1,000 to $6,000.

Similarly, your policy may limit fine arts and other valuable articles. In fact more frequently now, we are seeing insurers adding limits for wine collections and video/audio supports, including DVD's .

At Ogilvy we have policies that generally start with special limits of $5,000 on jewellery, however each policy varies.  One of the things we do, is have the discussion with our clients tailoring their insurance package to suit their needs. Whether you deal with a broker or a direct insurer, take control of your insurance and make sure to ask these questions before you purchase or renew your policy.

If you do not know the answers to the  questions above, take a few moments and email or call your insurance representative . You will be glad you took the time now, instead of later. The last thing you want to do when you suffer a loss (theft, mysterious disappearance, etc.)  is to add to the devastation by finding out you did not have the right coverage.

Upcoming posts on Valuable Articles will highlight:

  • Evaluations of Fine Arts, Antiques, Collectibles, Heirloom Pieces. If you do not have a value, how can you expect to be paid? What is taken into consideration in a fine arts appraisal?
  • Types of coverage & Basis of settlement . This becomes very important with Fine Arts, Antiques, Collectibles, Heirloom Pieces, etc. because often they are not replaceable. There are a few options to learn about - some insurance policies will not pay out on value if the item is not replaceable.
  • Wine Collections - Yes, some policies do insure wine! Many options are available to protect your collection.Definitely somethign to think about!

Have you recently purchased something special, or do you already have a collection at home of art or even Jewelry - how do you protect it? A lot of people don't do anythign about insuring these items, and just take their chances ~ what is your take?

 

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