Insuring Your Wine Collection
As wine collections increase in value, collectors should consider insuring a valuable collection. According to the experts at Fireman's Fund Insurance Company's Wine Collector Management Services, here are a few things to keep in mind before buying a policy (or renewing or amending one you already have).
Insure your collection separately if it is valuable
As a consumable that appreciates in value as it ages, wine is a unique asset. If your collection has great value, it should probably be insured separately from your general homeowners' insurance policy. If not, you may run the risk that it is under-insured. The average bottle cost in a wine cellar is often $100 or more; individual bottles can easily reach $700 to $1,000 for top wines. A cellar that contains, say, 500 to 1,000 bottles, can be worth between $50,000 and $100,000. Values can easily climb into the millions for larger collections.
Choose blanket coverage or itemized coverage, or a combination of the two
With blanket coverage, your entire collection is covered under one limit, with a single bottle limit of up to $50,000 (with a Fireman's Fund policy). Itemized coverage is recommended for wines valued at $10,000 or more and can be combined with blanket coverage to provide the best protection for your collection. There should be no deductibles on standard policies.
If you buy insurance, be sure it covers all risks
Buy coverage that spans a wide spectrum of causes of loss including fire and theft breakage, flood, and a range of others. You will also need coverage for loss due to power outage or mechanical breakdown of heating, cooling and humidity control equipment, all of which are critical coverages for oenophiles.
Don't transport your wine without checking with your insurer first
Before you transport your wine, ask your agent or insurer if this is a covered risk by your insurance policy. Be certain your wine is protected worldwide and while in transit.