Insuring a collection that has no catalogue price

Part of the valuables cluster. Wine has its own set of storage and spoilage questions, covered in the cellar guide.

A collection presents a problem no single object does: the value is distributed, the pieces are frequently not individually documented, and much of what makes the collection worth what it is — completeness, condition, the fact that these particular pieces are together — does not appear in any price list. Insurers handle single objects well. They handle collections badly unless the arrangement is built deliberately.

The inventory is the whole job

Every other decision depends on having an inventory, and nearly every collection claim that goes badly goes badly for want of one. After a burglary or a fire, the burden of proving what existed sits with the owner. A recollection is not evidence; an itemised list with photographs, kept off-site, is.

What a workable inventory records, per item or per group: a description precise enough to identify it, dimensions, maker or period where known, condition and any restoration, the acquisition date, what was paid, and where it is kept. Two photographs — one general, one of marks, signatures or damage — are worth several paragraphs of description. Keep the file somewhere other than the building holding the collection, and date each revision.

The inventory is not paperwork for the insurer. It is the document that decides what you recover when the collection is no longer there to be examined.

Blanket cover, scheduling, or both

Collections are usually insured in one of two ways, and most sensible arrangements use both.

Blanket cover puts one sum over the whole collection with a stated cap on any single item. It suits collections of many broadly similar pieces — books, records, coins, ceramics, militaria — where individually scheduling three hundred items would cost more in administration than it returns. It flexes as the collection grows, within the sum.

Scheduling lists individual pieces with their own agreed sums and removes them from the per-item cap. Anything materially above the blanket cap belongs here, along with anything whose value rests on attribution or provenance rather than type.

The pair or set clause

This clause decides more collection claims than any other, and it is rarely read before it applies. It governs what happens when one part of a set is lost or damaged: a chair from a set of eight, one of a pair of candlesticks, a volume from a bound series, a single piece from a dinner service.

The restrictive version pays only the proportionate value of the part lost — one eighth of the set, for the chair — which is arithmetically tidy and commercially wrong, because seven chairs are worth far less than seven eighths of eight. The favourable version treats the loss as a total loss of the set, pays the full set value, and takes the remaining pieces in salvage. A middle version pays the loss in value to the set as a whole, assessed after the event.

Which one applies is a wording question, and it is negotiable at inception in a way it never is afterwards. If a collection contains sets — and most do — this is the clause to check first.

Restoration, condition and what is actually paid

For antiques, condition is value, and the two interact in ways that surprise people. Original condition, including original surface, is frequently worth more than restored condition, so a well-executed restoration can reduce the value of a piece rather than return it. A specialist wording handles this the same way an art wording does: it pays the restoration cost, and separately pays the loss in value that survives the restoration. A general contents section pays a repair invoice and stops.

Restoration invoices are also part of the value in their own right. A piece bought for €4,000 and restored for €9,000 is not a €4,000 item, and the only evidence of that is the invoice. Keep it with the inventory record.

Valuing what has no catalogue price

Some things have a published market: coins, stamps, wine, and to an extent furniture by known makers. Much of what sits in a real collection does not. The route through is a specialist valuation that shows its reasoning — comparable sales where they exist, replacement cost through the trade where they do not, and an explicit statement of the basis used. An underwriter will accept a well-argued figure from a recognised specialist and record it as the agreed value; that is precisely what agreed value is for. What an underwriter accepts as a valuation covers who can issue one in Portugal.

Where a collection appreciates, keep the figures moving. An out-of-date sum insured on a blanket collection exposes every partial claim to proportional reduction, not just the total loss.

Storage, security and movement

Underwriters price a collection by where it sits and how it is protected. Expect questions about which rooms hold what, whether display cases are locked and to what standard, the alarm grade and whether it covers the rooms in question, and whether anything is stored below ground, in an outbuilding, or off-site. Each location is declared and rated separately — including a bank vault, which is usually the cheapest place in the arrangement to hold anything not on display.

Two Portuguese specifics recur. Coastal humidity in the Algarve affects furniture, paper, textiles and gilt; gradual deterioration is excluded by every wording, so dehumidification is a maintenance cost rather than a claim. And second homes left empty for months engage the unoccupancy clause, which can suspend theft cover after a stated run of consecutive days — a serious matter when the contents are the reason for the policy.

Movement needs its own treatment. Taking pieces to a fair, lending to another collector, or sending something out for restoration all take the items outside the insured address, and none is automatically covered. Bringing a collection into Portugal in the first place is covered in moving a collection to Portugal.

The same collection in Spain

A collection kept in Spain is underwritten on the same principles: an inventory the insurer can rely on, a choice between blanket and scheduled cover, a pair or set clause, and agreed values supported by a specialist. Spanish contract law expressly allows the parties to fix the insured value in the policy, and applies the regla proporcional where they have not and the sum proves too low — the same mechanism as in Portugal.

The Spanish specifics are these. Catastrophe damage — earthquake, extraordinary flood and similar events — is paid by the Consorcio de Compensación de Seguros from a surcharge on property policies, working from your own sums insured; in Portugal earthquake is an optional extension and needs choosing. The environmental risk varies by region rather than by country: dry interior heat in Madrid or inland Andalusia acts on veneers, lacquer and paper as surely as coastal humidity does in the Algarve. Standard Spanish wordings separate robo from hurto in the same way Portuguese ones separate roubo from furto, which matters for pieces displayed where visitors come and go. And items old enough to fall under Spanish heritage law may need an export permit before they travel to a fair or restorer abroad.

For collections in Spain, see private clients in Spain; for the property that holds them, insuring a high-value home in Spain.

Adler & Rochefort is a commercial brand of Ownizo, Unipessoal Lda., registered with the Portuguese Insurance and Pension Funds Supervisory Authority (ASF) under no. 425591790/3. General information only, not personalised advice; cover, sub-limits and conditions vary by underwriter and by risk.