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With rising inflation, price fluctuations are a key concern for wealthy individuals. The survey of 250 UK HNW individuals who invest in art and other collectibles found that three in five (60%) are concerned about the increases in value of their assets.
Three-quarters (76%) of those surveyed said the value of their art and collections has increased during the past 12 months. Three-quarters (76%) also expect the value of their art and collections to increase further during the next year.
Having regular valuations to keep pace with value fluctuations is essential. The research discovered that over half of HNW collectors say they have at least one collection appraised annually. However, 5% admit they have their art and collections valued more than every five years, and 4% do not get their collections valued at all.
Collections are most commonly valued by an independent professional or registered valuer (86%) and most likely for insurance purposes (69%). However, two in five (37%) of those surveyed said they have a probate valuation, and over a third (35%) reported having a high auction valuation.
Ecclesiastical is encouraging brokers to speak to their clients about the importance of regular valuations to ensure they have the right cover in place.
The specialist insurer recommends that HNW clients review their sums insured annually. Under the Ecclesiastical Art and Private Client policy, clients with professional valuations less than three years old at the time of loss benefit from extended replacement cover, meaning the insurer will pay the value of the item at the time of the damage, even if this is more than the value shown in the valuation.
“Underinsurance has always been an issue in the high net worth sector, but now, with continued high inflation, it’s more important than ever that brokers are speaking to their clients about the importance of regular valuations. Our latest research has found that the majority of high-net-worth collectors are concerned that their art and collections are underinsured. Wealthy individuals 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.”
Last year, Ecclesiastical launched an enhanced high net worth home insurance product that includes cyber damage, cybercrime, and online liability cover as standard, and optional additional covers including business cover and travel insurance. Read more information about our Art and Private Client insurance.
* The research was commissioned by Ecclesiastical Insurance and conducted by BVA BDRC. Online interviews were carried out 9 - 27 July 2023 with 250 UK high net worth individuals with an income of at least £200,000 per annum or liquid assets of at least £1million about their art and other collections.