In 1862, Emily Dickinson famously wrote, “The heart wants what it wants.” While this quote often captures the inexplicable nature of human desire, it also resonates with the motivations behind collecting. Whether it’s choosing a potential mate or pursuing a coveted object, the pull of desire remains the same when it comes to collecting.

The term “collection”—or more specifically, “art collection”—often evokes thoughts of fine art and antiques. However, a relatively newer term, “passion asset,” has gained traction in modern discussions, encompassing a broader range of valuables. Simply put, a passion asset is a luxury collectible: a tangible item that combines emotional significance with financial value. These assets reflect an owner’s personal interests or hobbies and span diverse categories, including fine wine, classic cars, rare watches, couture clothing and accessories, jewelry, rare stamps, coins, and, of course, art and antiques.

While most passion assets are cherished for personal enjoyment, they also hold the potential to appreciate—or depreciate—in value over time. According to the insurance firm Marsh McLennan, luxury assets have grown in value by 123% over the past decade, establishing themselves as a meaningful asset class.

Like conventional assets such as real estate, stocks, and bonds, passion assets can also serve as collateral for loans, provided their value exceeds the debt plus interest. Formal USPAP-compliant appraisals are essential in these cases. For example, appraisals for Fair Market Value or Marketable Cash Value guide lenders in structuring asset-backed collateral loans.

However, the qualities that make passion assets so precious to collectors also expose them to unique risks—risks often not covered by standard homeowners’ insurance policies. This makes it critical to secure proper coverage. Options include additional coverage from large insurers like CHUBB or bespoke policies from specialty firms such as Treadwell and Distinguished, both of which cater specifically to luxury collectibles.

Several nuanced factors determine the value of passion assets, including rarity, quality, condition, and provenance. As experts in the industry, Art Peritus is uniquely equipped to provide comprehensive USPAP-compliant appraisals and impartial guidance on all categories of passion assets. Our insights not only assist insurance, but they also help banks and wealth advisors recommend diversification strategies and maintain appropriate loan-to-value ratios.

In the world of passion assets, the heart may want what it wants—but the head must ensure that this love is thoroughly documented, appraised, and insured.

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