Art Collector Chatter: Four Different Types of Grades

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The rating assumes that the item is genuine.

When working with an evaluator, keep in mind that there is a difference between evaluation and authentication. When you hire an appraiser to get an authentication report, you ask the appraiser what they think of who created the work. Once the creator of a work is confirmed, an appraisal is made based on the assumption that the work is real.

Estimated values ​​vary depending on intended use

Depending on why you need an estimate—for example, an insurance claim versus selling an item—you need a different estimate for each scenario.

Most people use four main types of assessments:

Fair market value

Fair Market Value (FMV) is the price at which an item would sell between a buyer and a seller on the open market. FMV is commonly used for charitable donations and inheritance tax.

Recovery cost

Replacement cost is the cost that would be required to replace an item with a similar work under equal conditions, purchased from a suitable market within a limited period of time. This value is the highest value of the artwork and is used for insurance coverage.

Market value

Market value is what a buyer is willing to pay a seller without any obligation to trade in a competitive and open market.

Liquidation value

Salvage value is the value of an item if forced to sell under limited conditions and possibly under time constraints.

File ratings with your documentation

When you receive your evaluation document, be sure to keep it in your records. This is the number that insurance companies and estate planners will use to file a claim or create your art estate. It can also serve as dated proof of ownership in addition to your sales invoice.

Members of the Art Archive may store their evaluation documents on the Artwork page. Documents are always ready when you need them, which relieves stress and reduces risk.

Work with your estimator so that you have the values ​​for each situation you might need and can refer to your account in any situation. Online, anytime, anywhere, you will be an experienced collector.

Learn more about archiving your collection and the details that prove the value of your collection. Download our free e-book that explains everything you need to keep your collection in top condition.