Why you need a valuation for your collectibles — and how to get one

Whether you’ve inherited a few pieces of jewellery, are starting to collect sports memorabilia, or have invested in wine or fine art over the years, your collectibles are a part of your history and your story. They may even be worth a substantial amount of money.

Any time you own a collection, consider getting the items valued. Here’s why:

• You’ll probably want to protect them. To get insurance on valuable collectibles, you may need to know how much they’re worth. A valuation will let the insurance company know the appropriate compensation amount if your pieces are lost, stolen or damaged. Keep in mind that most standard homeowner’s policies will provide limited coverage for valuables. To fully protect your collectibles, you may need a premium policy.
  
  
• You may want to sell them. If you’re looking to sell your valuables, you’ll need to know how much to charge, and potential buyers will probably want to know the process by which the item’s value was determined. A professional valuation is the way to go.
  
  
• You may have inherited them. If you inherited collectibles, you may need to have them valued to accurately calculate any applicable taxes if you later decide to sell them. You should seek specialist tax advice in this regard.

You may be surprised to know that there are different values for the same item. Depending on the purpose of the valuation, the same item can have more than one type of value. The two most common are fair market value and retail replacement value.

• Fair market value is the price at which property would change hands between a willing buyer and a willing seller. This value is typically used for tax purposes or to inform a sale.
  
  
• Retail replacement value is the highest amount that would be required to replace a piece with another of similar age, quality, origin, appearance provenance, and condition. This value is typically used for insurance purposes.

People often think that the way to get a valuation is to go to the place where that type of valuable is sold. For example, if you inherited an antique collection, you might think it wise to go to an antique shop for a valuation.

Actually, the opposite is true!

Make sure you seek out an expert who does not have an active interest in purchasing your item.

To find a registered valuer:

• Consult a reputable valuer association. Search for a member of the National Council of Jewellery Valuers or the Auctioneers and Valuers Association of Australia. To obtain and maintain membership in these organisations, valuers must complete courses and exams, demonstrate years of experience, and adhere to a set of strict ethical standards.
  
  
• Look for someone who has expertise in what you have. Not all valuers have knowledge of all types of valuables, so find someone who really knows the type of item you have.
  
  
• Avoid valuers who charge a fee based on a percentage of the item’s value. This is a conflict of interest. Instead, your valuer should charge a flat fee or hourly rate.

At Chubb, we insure luxury items as part of our Masterpiece Home and Contents policy. Learn more about how our Masterpiece policy can help cover the special pieces you’ve acquired over the years.