As a recent article explains, high net worth families are increasingly turning to tangible assets to hold their wealth. A 2012 report cited in the article explains, “high net worth individuals hold an average of 9 percent of their wealth in tangible assets.” More than half of those surveyed stated that a large reason they purchase rare collectables and memorabilia is for the investment value of the items. Additionally, unlike a bank account, these assets have aesthetic benefits. Despite their many benefits, tangible assets do not come without some form of risk. Therefore, it is important to consider these assets as part of your overall asset protection strategy.
Asset protection for a tangible asset begins with an accurate appraisal. If you need help finding a qualified appraiser, consult an appraisal industry association such as the American Society of Appraisers. After you have gotten an appraisal, the next step is to confirm that you have proper insurance coverage. Most insurance companies offer a valuables policy, which allows a person to declare their valuable items individually and list the value of each piece or collection within the policy. Additionally, for tangible assets subject to price variation, many policies will guard against this by covering the item for its market value at the time of loss up to 50 percent over the value indicated on the policy.
While insurance is important, most people would rather not have to deal with loss of a valuable item in the first place. Therefore, it is also important to meet with a risk consultant with the goal of preventing loss altogether. Through working with a risk consultant, families can assess risk factors and provide more security for their items.