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Why Wine Collectors Need to Be Careful About Insurance

Monday, September 21, 2020
Why Wine Collectors Need to Be Careful About Insurance

Today wine is traded not only at traditional auctions and among a vast secondary market of private buyers and sellers but also by professional investment funds operating on international exchanges. 

Wine has become a true asset class—and a notable portion of many collectors’ net worth.

Whether you collect for consumption or with an eye to investment, the wines you keep at home may carry significant value, and that value may be at risk.

Fires, floods, natural disasters, and theft are threats to the most valuable articles. But wines are uniquely sensitive to some sources of harm:

  • Power outages and other failures of environmental controls can expose collections to high temperatures that “cook” the wine, reducing its complexity to a flat stewed-fruit flavor. 
  • Too-low levels of humidity can cause corks to become dry and brittle, allowing air to prematurely oxidize wines. 
  • Too-high humidity or precipitation from a faulty cooling system can lead to moldy conditions in a cellar. Even without harming the wine, moldy labels can reduce a bottle’s value by twenty-five percent or more. 

These kinds of damages to wine collections are usually not covered by a standard homeowner’s insurance policy. Policies that cover the contents of homes are typically not sufficient to protect valuable collections. Most set sub-limits for valuables like watches, jewelry, and art, and these limits can be low. 

Since wine collections are something of a new frontier and often a gray area in insurance, policies that do cover valuables may not cover the specific causes of harm that are unique to wine. Losses while away from the premises, certain causes of breakage, and mysterious disappearance may also be left out of policies being counted onto protecting valuable collections.

Owners of wine collections should carefully examine their existing policies and, if in doubt, explore the many tailored coverage options that exist today. For an expert policy review and information about how to best cover your collection, contact Ken Sidlowski from Horton’s Private Client Group by email or at 708-845-3159.

 How else can the Horton Private Client Group help me? 

The Horton Private Client Group is a trusted advisor to successful individuals and families.  We analyze risk and recommend personal insurance programs to mitigate the potential of financial loss.   We achieve this through discussion, education, and goals-driven risk management solutions with our carrier partners.

Although we certainly can place stand-alone coverage for your wine or fine spirits collection, we also work with sophisticated insurance carriers, such as Chubb, AIG, PURE, Nationwide Private Client, The Cincinnati Insurance Company, and Berkley One to provide tailored solutions for all lines of coverage.  This includes, but is not limited to:  Homeowners, Condo-owners, Automobile, Excess Liability/Umbrella, Watercraft, Cyber, and many more….    

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Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.