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The Value of Collectibles and How to Protect Them

Factors to Consider: The insurance value is the cost to replace the artwork in the retail market.

The art and collectible market is cyclical. Many insiders considered the slowdown in the market as a correction rather than a collapse.

Art market experts did not expect the financial crisis to hit as hard as other investment sectors. Jussi Pylkkannen, chairman of Christie’s Europe, told Bloomberg “the correction in the art market will be less severe than the one in the early nineties.” “We already know this because the immediate impact of what has been a very dramatic downturn in the financial markets has had a less significant impact on the art market.” Jussi was correct the high end of the art market has rebounded dramatically from the financial crisis.

Specialist art insurance policies allow collectors to protect the value of their collections against physical loss or damage. Besides private collectors, buyers of art insurance include corporate collectors, art galleries, dealers, museums, exhibitions, and auction houses.

Art insurance is not just for painting and sculptures. Items like porcelain, rare books, stamps, coins, antique cars, musical instruments, jewelry, watches and many more could be insured as well.

The insurer will consider factors such as the fragility of each item, where the items are located, the fire protection and security measures that are in place, as well as the value of the individual pieces.

We recommend the following action:

Get an updated appraisal. Whether the value has gone up or down, an updated appraisal will confirm the amount of coverage needed to adequately protect a collection. This is especially important for works by artists that have seen dramatic price changes such as Warhol, Murakami and Prince.

In order to save appraisal costs, revisit the firm who initially appraised the collection or sold you the piece. They may be able to update the value at a reduced cost.

We are in contact with art collection management teams that can help you properly manage your collection and maintain the value.

Service can include:

  • Schedule review
  • Vulnerability Assessments
  • Catastrophe Planning
  • Appraisal Discounts and Coordination
  • Inventory Management


If you would like more information about protecting your collectibles or a review of your investment portfolio, please contact Peter C. Karp at 415-345-8185 or email peter@karpcapital.com.


DisclosureThe posted information is for informational purposes only. This message does not constitute an offer to sell or a solicitation of an offer to buy any security. All opinions and estimates constitute Karp Capital's judgment as of the date of the report and are subject to change without notice. Accordingly, no representation or warranty, expressed or otherwise, is made to, and no reliance should be placed on, the fairness, accuracy, completeness or timeliness of the information contained herein. Securities offered through Infinity Financial Services (a registered broker-dealer, member FINRA, SIPC). Infinity Financial Services and Karp Capital Management are not affiliated companies.

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