New research commissioned by specialist insurer Ecclesiastical has revealed that over a third (35%) of wealthy individuals cannot recall the last time they had their art and collections valued.
Ecclesiastical is urging brokers to engage with their clients about the importance of regular valuations to ensure adequate insurance coverage.
The survey, which included 250 high-net-worth (HNW) individuals who invest in art and collections, found that jewellery, watches, wines, books, and paintings were the most commonly acquired collections in the past 12 months.
The research indicated that those with higher incomes and individuals aged 35-44 were the most active in acquiring a diverse range of collections.
The data also showed an increase in purchases compared to the previous year, with notable growth in investments in jewellery, watches, wines, books, and trainers.
Despite the importance of regular valuations to account for fluctuations in value, nearly half (48%) of those surveyed admitted they do not regularly value their art and collections.
Furthermore, concern about underinsurance has decreased, with only 50% expressing concern that their art and collections may be underinsured, a decline of 12% from the previous year.
Ecclesiastical advises that HNW clients should review their sums insured on an annual basis. Under the Ecclesiastical Art and Private Client policy, clients who have professional valuations less than three years old at the time of loss benefit from extended replacement cover.
This means the insurer will cover the value of the item at the time of damage, even if it exceeds the value indicated in the valuation.
Dr James Lindow, underwriting director for art and private clients at Ecclesiastical, highlighted that underinsurance has long been an issue in the high-net-worth sector. He expressed concern that over a third of HNW individuals cannot remember the last time they valued their art or collections, stressing the importance of brokers discussing regular valuations with their clients.
“Clients should review their sums insured annually to ensure their possessions are insured correctly. Brokers play a vital role in ensuring their clients have the correct cover in place,” Lindow said.
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