Questions About Appraising Art and Decorative Art for Homeowner’s Insurance Purposes

LW called me while her friend’s house in the Palisades was still smoldering. She asked me this important question: “Elizabeth, W didn’t have an appraisal for his contemporary lithography and modern art collection. He assumed the artwork was insured under the fine art category in his general homeowner’s policy, and he seems to recall the aggregate total coverage for fine art is $60,000, but the art is not itemized. He didn’t request separate fine art rider coverage, for which he would have needed an appraisal (to create an itemized schedule of the art). Now the artwork is gone. Should he hire you – an appraiser – now?”

Here are the top ten factors raised from this one question; a very timely question indeed:

1. W must understand his policy. I gave LW the name of a great insurance attorney who has used me for years in fire cases if W needs help in reading the fine print. There are two types of personal property – appreciable and depreciable. Generally, art is appreciable, and furniture is depreciable. But my collectors of fine vintage furniture do NOT consider their Eames Chair depreciable. What kind of coverage does W have? Market value typically refers to actual cash value, not replacement cost. The difference can be vast: think of the value of a high end five-year-old TV (market value) versus the replacement of that same TV, but at the cost of a 2025 model. Finding sales in the right market is important, I give you a few tips on market research below.

2. An appraiser after a loss might be helpful (read on…). However, since W had blanket coverage for $60k of art, to itemize the artwork would only be helpful up to the aggregate market value of $60k. Once he reaches that limit in terms of market value, he needs a certified appraiser to itemize art and set values if he plans on claiming anything over the aggregate amount. This effort may be too late.

3. Since the collection is gone, to make a claim W will have to prove ownership and the former location of the art, and indeed the collectible furniture in the home. Social media provides ways he can prove ownership. He’ll be surprised how many photos he’ll find on social media that show a work of art in the background. Look for shots of interiors “behind” family, dog, or friend.

4. W might want to research market value of works of art on websites that list completed SALES at auction. I find comparable sales from PAST sales – not the offered price, the “would you take it” price. Here are some sites I use:

a. P4a (antiques, decorative art, fine art)

b. Askart (American artists SOLD prices)

c. Artprice (great for European works, SOLD prices)

d. Mutualart (good for the modern/contemporary art market; this website reports on artworks which have SOLD (consummated prices paid), but they also carry dealer’s offers to sell)

e. Artnet (a full-service site for decorative art and fine art that has SOLD)

f. Worthpoint or the Invaluable site

5. Although in most cases a valuation is based on prices PAID in the market, insurance companies will also accept offered prices as comparable research, but they will depreciate those prices. There are two ways of researching comparable furniture or fine art: one is to gather sales based on an auction or gallery result, the other is to find three or more OFFERED prices asked that are fairly consistent in the market.

6. Before W hires me and pays out of pocket, insurers may hire an appraiser if stated in the “appraisal clause” in the policy. Later, W might hire his own appraiser if he disagrees with the insurance company’s adjustor or appraiser. However, if an agreement is not reached, a third appraiser is hired as an umpire. It can drag on forever and become expensive. Since he did not have scheduled rider coverage, this may be a moot point; art values were not set forth so values can’t be argued over. But the furniture is another story, as it might be argued that designer furniture from the 1960s is appreciable…

7. A professional appraiser would have been helpful before a loss for the itemization and documentation needed for rider or scheduled coverage. I might be helpful to W to spur his memory of the objects in his lost home, however. Because I have seen thousands of households and thousands of different collections of art, or furniture, silver, glass, musical instruments, porcelain, books, or toys, I can often regain a memory. After a loss, I am often hired by law firms to ‘find’ objects of value that a client might have forgotten. For example, if you collect Chagall you might also collect Dali prints. Much of my “fire victim” work is done by providing a conversation space from which I can “see” the interior of an imagined room setting or a fine collection. The conversation sounds like this: “Oh, you had your grandmother’s tiny diamond cocktail watch, your mom’s Bulova, you dad’s Rolex – did you also have your grandfather’s gold pocket watch?” I am well-versed in the associative rebuilding of a lost collection or a lost living space.

8. A prominent attorney who is working on client losses in the Eaton Fire tells me that some insurance attorneys who are representing claims of the mega-wealthy will act as a ‘public adjustor’ for 10% of the claim’s settlement, a clever way to capitalize on just how bewildering insurance losses can be…

9. Your very best method of proving ownership and location is to do two things with your phone this weekend. Have someone film a video of YOU going through your home and narrating what you know about each items of importance. “Importance” might mean of family relevance, or it could mean an object over $1,000 or BOTH. This proves location and ownership and provides a record for heirs as well. Second, take STILL photos of the objects you would HATE to lose. Still photos can be manipulated in a way a video cannot; a skilled researcher can find MUCH information with a good zoom. MAKE COPIES OF BOTH VERSIONS. This matters far more than a collection of receipts.

10. A simple thing no one does is to raise art off the floor of a closet! In fighting a fire or in a flood, objects close to the floor will be soaked.  

Email me if you have questions at elizabethappraisals@gmail.com or call 805 895 5005