Bensman Risk Management, Inc.

Insurable Interests

Bensman Risk Management, Inc.
2333 Waukegan Road Suite 275
Bannockburn, IL 60015
847-572-0800 Phone
847-572-0502 Fax

Insurable Interests may offer general financial, insurance, tax and business ideas. However, due to the ever-changing tax laws as well as the complexity of the financial industry, you should seek professional advice before implementing any of the ideas contained in this newsletter. The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C. assumes no liability whatsoever in connection with the use of this newsletter.

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Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS). Kestra IS and Kestra AS are not affiliated with The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C.

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Insurable Interests

Vol. 3, Issue 11July 2008


When You Need an Appraisal

Everyone has heard the stories about the garage-sale painting that turns out to be worth hundreds of thousands of dollars. And while that is definitely the exception rather than the rule, lots of people have items that may be much more valuable than they think.

It can be important to establish the value of items for a number of reasons. Obviously, you'd like to know if you are sitting on thousands of dollars of stuff you didn't realize you had. But you also may need an appraisal if you want to donate an item and take a tax deduction, if you are figuring the value of an estate or if you are negotiating a divorce settlement, for example.

Certain items in particular may have unrealized value, including:

  • Art. That little watercolor you bought from the artist during a beach vacation 20 years ago may be worth a lot more now, especially if the artist has gone on to become popular among collectors. You should take a look at original art, as well as gallery-quality prints. (Your old concert posters from the Grateful Dead are probably not going to help fund your retirement.)

  • Jewelry. You know what new jewelry is worth, but jewelry you have had for some time, or inherited, probably needs to be re-valued.

  • Antiques and collectibles. This market can be very volatile, as certain items become wildly popular for a while and then lose popularity – remember the Beanie Babies. But significant antiques, such as nice furniture, glassware, silver or collectibles, may increase steadily in value.

  • Heirlooms. When your Uncle Wally died and left you a box full of old coins or a collection of military memorabilia, he may have been more generous than you think.

The best – and often the only – way to find the value of such items is to have them appraised. But how do you find an appraiser? You can start by talking to your insurance broker or your financial adviser, who may be able to suggest someone. Or you can contact someone who regularly deals in the item you want appraised. For example, for jewelry appraisals, contact a jeweler. If you have art, you can contact a gallery that deals in the kind of art you have. Even if they can't – or won't – do the appraisal, they should be able to steer you in the right direction. For collectibles or antiques, you can ask for a suggestion from a museum.

There are also professional organizations for appraisers: the International Society of Appraisers, Appraisers Association of America and the American Society of Appraisers. Each of these groups provides information on finding an appraiser.

Usually you have to pay for appraisals, so find out as much as you can about the appraiser before you go ahead. Ask about the appraiser's training and experience, especially in the specific item you have. Understand the fee structure. And make sure the appraiser will provide the necessary documentation, which should include a specific value for the item, an explanation of how the value was arrived at and the purpose for the appraisal.

One final note: If your appraisal shows that the item has significant value, talk to your insurance professional about whether you should increase your coverage.

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