Billion-dollar weather events are on the rise. As an insurance agent, you are likely counseling clients to review and adjust coverage for their personal homes and commercial properties. But have you asked about their collections of artwork, signed sports memorabilia, Wine…or something else?
For context, insured losses due to severe weather have been on an upward trajectory for the past several decades. The National Oceanic and Atmospheric Administration (NOAA) reports that 18 weather events resulted in insured losses of over $165 billion in 2022 alone. Data from the current year confirms 7 weather events with insured losses totaling over $1 billion each.
Museums and galleries maintain loss-prevention plans for severe weather. If you have a client with a significant investment in fine art or another type of collection, it’s wise to provide them with risk management resources and appropriate insurance coverage. A business owner with a collection of signed sports memorabilia on display in the office needs a plan to protect those items and minimize the risk of damage or loss caused by severe weather.
Rain, wind, hail, flood, fire, and other natural disasters can result in costly damage to fine art and other valuable items. Collections can serve as an important financial safety net for owners due to the potential for items to appreciate in value over time. Yet even after spending untold hours researching, acquiring, and caring for their treasures in addition to the accompanying financial investment, many collectors remain unprepared when it comes to protecting their valuable assets. With hurricane season approaching, the need for having a risk management plan in place to protect fine art and collectibles becomes all the more important. In this article, we’ll go over tips insurance agents can share with their clients to help them be better prepared in the event of a hurricane, severe storm, or other catastrophic events.
Installing Special Systems for Mitigating Risks
Reinforced windows can serve as additional protection for a collector’s home; these are specially designed to be impact-resistant and are typically made of polycarbonate materials. Thanks to their strength and durability, impact-resistant windows are considered unbreakable. Protective shutters also serve as a barrier to high-speed winds. It’s best to consult a professional for the selection and installation of these types of windows and shutters.
Having an HVAC climate-control system can regulate the indoor temperature of the client’s home and protect collections of delicate showpieces — such as antique paintings — from being damaged due to seasonal humidity. If a collector is considering having an HVAC system installed, the first step is to contact a licensed HVAC professional for advice and proper installation.
Waterproof storm closets can be custom-built as the perfect place to store collections. Housing collectibles in a self-storage facility is an alternative option that does not require home remodeling or construction; however, it is important to select a self-storage facility that provides temperature and humidity controlled spaces as well as up-to-date security features.
Making an Inventory
Creating a detailed inventory to document a collection ensures your client will be able to justify the value of damaged or lost items as part of an insurance claim. An inventory of a collection should include detailed information about each item such as:
- Maker name
- Year and date of creation
- Receipts and invoices
- Dimensions and weight
- Other relevant documentation
Once the documentation has been assembled, the collector should make several copies. Copies should be shared with the insurance agent and attorney, with a copy maintained in a fire-proof safe, a copy stored in the cloud, and one stored off-site in a secure place, such as a safe deposit box.
Responding to Weather Alerts
Sophisticated modeling and satellite data make it possible to monitor severe weather trends days and weeks in advance of a potential event. When a weather alert is issued, collectors can prepare by moving their items to a designated storage area such as a storm closet, fireproof safe, waterproof art storage container, or off-site storage facility. Artwork that must remain outside, such as heavy sculptures, furniture, or exterior decorative materials, can be protected by being bolted down, or wrapped in protective blankets and secured with rope. Small objects and works on paper, such as paintings, lithographs, and photos, may be stored indoors in waterproof containers and cases. To guard against rising water, storage containers should be elevated at least six inches off the floor with blocks, pallets, or shelving.
Items transported to a self-storage or art-storage facility in preparation of a severe weather event should be packed carefully with a detailed inventory noting which items are being moved off-site. This relocation list, in conjunction with the complete collection documentation, will provide critical information for collectors and their insurance agents in the event of loss or damage that results in a claim.
Assessing the Damage
Once the storm is over and it’s safe to do so, the client should inspect their belongings to determine the extent of any damage. Here again, documentation can provide crucial information in the event of an insurance claim. Photographs, video, and written documentation each step along the way can be key to supporting a client’s claim in terms of the cause and extent of damage as well as providing evidence of preventive measures taken prior to the weather event. All damage and losses should be reported to the insurance agent as soon as possible to ensure the most positive outcome for the collector in terms of claims processing and resolution.
Putting a plan in place to minimize potential damage to valuable items caused by catastrophic weather is an important risk management step for any collector. As an insurance agent, you can identify appropriate insurance coverage to complement your client’s proactive measures to protect their investment. MiniCo’s exclusive Collectibles Insurance program is a preferred solution for insuring collections of fine art, sports memorabilia, wine and spirits, and hundreds of other collectible categories that are expected to appreciate in value. Apply on our portal for a quote in minutes.