14 Mar Fine Art and Valuable Photos: A Look at Scheduling Items for Insurance
We’ve all seen the insurance commercials where they make light of terrible situations, but as funny as they may be, disasters happen. As artists, it is always upsetting to see a piece of art suffering from smoke damage as a result of a fire or mold from water damage in a basement flood. It is heartbreaking to see clients realize that their items are not covered properly on their homeowner’s insurance and have to decide on whether to restore the piece or let it go. There are limitations to coverages that policyholders never think about until after a claim happens.
Tired of seeing clients hurt, so we decided to get more information about homeowner’s policies.
What is unscheduled vs. scheduled items?
“If you have a fire and a painting is worth $5,000, a homeowner’s policy is only required to replace the painting,” says DiAnne Saine, Vice President at Diversified Insurance. The obligation of a regular homeowner’s policy doesn’t require them to pay the exact value of the painting if they can find it at a better price. “Scheduling an item means that you’re going to specifically describe and insure an item. You’re protecting the artistic value of the item.”
Unscheduled items are subject to the terms of your specific homeowner’s policy including the limitations and deductible. Scheduling an item means eliminating your deductible and expanding your coverage (i.e. covered for loss, mysterious disappearance). However, this still doesn’t mean that the item will be replaced at the scheduled value. “Settlement can vary from company to company,” says Saine. “A ring may be valued at $8,000, but an insurance company can go to a wholesaler and have it duplicated for $6,000. Look at the settlement provision. You need to put ‘agreed value’ on it to get the scheduled value. Some higher end companies will even pay up to 150% of the scheduled value.”
What should you itemize?
Most people schedule jewelry like engagement rings or heirloom pieces, but you can schedule more than jewelry. Art, antiques, rare coins, high end cameras, and more can be itemized on a homeowner’s policy. “Itemize things with sentimental value,” says Saine. “Some people say they don’t want to itemize things under $1,000. That’s fine, but remember that the deductible will come into play.”
Mary Lou recommends looking at the value for:
- Original paintings or drawings, Daguerreotypes, civil war era photography (ambrotypes), ancestral images (tintypes, crayon portraits, cyanotypes, hair lockets etc.) showing mixed race couples, original gold leaf frames circa 1860 to 1940, heirloom wedding and baptismal certificates from Germany and France, and heirloom family bibles.
What do you need to schedule a piece?
You’ll need an appraisal or value of what you’re insuring. “Reassess the value every 7 – 10 years for items like silver and 5 years for jewelry pieces,” says Saine. “Look at the policy to make sure there’s an inflation factor in it. If that’s not sufficient, you want to get the items reappraised.”
Photos also help at the time of a claim. Take pictures of your items to catalog your belongings. If it is too overwhelming, you can use a service to help you. “Photo File is a service that takes pictures of everything you may need in the event of a fire claim,” says Saine. “They work with adjusters to know what they need, including the clothing labels. They do not retain the information and give you a thumbdrive with the images. You don’t want to store the photos in your house. Store it somewhere else. Keep it with your insurance agent or in the cloud.” The Maryland Insurance Administration also has a Personal Property Inventory Worksheet and more resources on their website.
Reviewing and updating a homeowner’s policy may not sound like fun, but it is better than finding out that you don’t have coverage after a claim. Take a few minutes to walk through your home and assess your belongings. What would you miss if the unthinkable happened?