Key Terms Defined

The replacement cost of property minus depreciation, representing what an item is worth at the time of loss.

A predetermined value for an asset established between an insurer and policyholder before any loss occurs.

Insurance coverage where the insurer and policyholder agree in advance on the value to be paid in case of total loss.

Investment assets outside traditional stocks, bonds, and cash, including collectibles, art, wine, and luxury goods.

A formal document that presents an appraiser's opinion of value for an asset, including methodology, analysis, and supporting evidence.

Professional guidelines and ethical requirements governing how appraisers conduct valuations and prepare reports.

Professional service providing expertise in art acquisition, collection management, and market guidance for collectors and investors.

The global marketplace where artworks are bought and sold through auction houses, galleries, dealers, and private transactions.

The total market value of investments that a financial institution or advisor manages on behalf of clients.

Additional fees charged by auction houses on top of the hammer price, typically including buyer's premium and sometimes seller's commission.

Published outcomes of auction sales including hammer prices, buyer's premiums, and whether lots sold or were bought in.

The total price realized at auction, typically including the hammer price plus buyer's premium and applicable fees.

The process of verifying that an asset is genuine and accurately attributed to its claimed origin, creator, or period.

The verification that an asset is genuine and was created by the attributed maker, not a forgery, copy, or misattribution.

Insurance that covers multiple items under a single policy limit rather than scheduling each item individually.

A valuation discount applied when selling a large quantity of assets would depress market prices due to limited demand.

An additional fee charged by auction houses to the winning bidder, typically calculated as a percentage of the hammer price.

The profit realized when an asset is sold for more than its original purchase price or cost basis.

The documented sequence of ownership transfers for an asset, establishing legal ownership and supporting provenance claims.

A tax deduction available for donations of property to qualified charitable organizations, based on fair market value.

A tax benefit allowing donors to deduct the fair market value of donated property from their taxable income.

An irrevocable trust that provides income to beneficiaries for a period of time, with the remainder passing to charity.

Physical objects valued for their rarity, historical significance, or cultural appeal rather than their functional utility.

Recent transactions of similar assets used as benchmarks to determine fair market value through comparative analysis.

A systematic evaluation of an asset's physical state, documenting damage, wear, restoration, and overall preservation.

A detailed assessment documenting the physical state, damage, and conservation needs of an artwork or collectible.

The cost-benefit analysis comparing restoration expenses against the potential value increase of an asset after conservation treatment.

The original purchase price of an asset plus any improvements, used to calculate capital gains or losses for tax purposes.

The collection of records, certificates, receipts, and provenance materials that support an asset's authenticity, ownership, and value.

The process of arranging for the management and distribution of assets during life and after death, including tax minimization strategies.

A federal tax imposed on the transfer of assets from a deceased person's estate to their beneficiaries.

Reductions in the taxable estate value allowed for specific items such as charitable bequests, debts, and administrative expenses.

Strategic arrangements to minimize estate tax liability through gifting, trusts, charitable giving, and valuation optimization.

The price at which property would change hands between a willing buyer and seller, both having reasonable knowledge of relevant facts.

The price likely to be obtained when an asset must be sold immediately without adequate time for market exposure.

A valuation reduction applied when valuing a partial ownership stake in an asset, reflecting limited control and marketability.

A valuation approach that evaluates an asset's intrinsic worth based on its inherent characteristics rather than market sentiment.

The final winning bid amount at an auction before additional fees and premiums are added.

An individual with liquid financial assets exceeding $1 million, excluding primary residence and retirement accounts.

Assets that cannot be quickly converted to cash without significant loss of value due to limited market depth or specialized buyer pools.

A reduction in value applied to assets that cannot be quickly converted to cash without significant loss of value.

An add-on provision to an insurance policy that provides additional coverage for specific items or circumstances.

The process of determining appropriate insurable values for assets, considering replacement cost, agreed value, or actual cash value standards.

The inherent worth of an asset based on its fundamental characteristics, independent of market price or external factors.

Tax form required for charitable donations of non-cash property valued over $500, with qualified appraisal requirements above $5,000.

The estimated amount an asset would realize if sold quickly under distressed or forced sale conditions.

A valuation reduction reflecting the cost and time required to convert an asset to cash compared to more liquid alternatives.

Additional value attributed to assets that can be quickly and easily converted to cash with minimal transaction costs.

A valuation methodology that determines value by analyzing prices from comparable sales transactions in relevant markets.

The ease with which an asset can be bought or sold in the market without significantly affecting its price.

The most probable price an asset would bring in a competitive and open market under fair sale conditions.

A reduction in value applied to assets that cannot be readily sold or converted to cash in public markets.

A valuation reduction for ownership stakes that lack control over key decisions such as sale, distribution, or management.

The per-share value of a fund calculated by dividing total assets minus liabilities by outstanding shares.

The expected price when assets are sold within a reasonable timeframe but under conditions requiring disposal rather than optimal marketing.

The strategy of spreading investments across different asset classes to reduce risk and optimize risk-adjusted returns.

The aggregate assessment of value across a collection of assets, accounting for concentration, diversification, and portfolio-level factors.

A transaction between private parties outside of public auction houses or retail markets, often at negotiated prices.

The ownership history and authenticity documentation of an asset, crucial for establishing legitimacy and value.

An appraisal that meets specific IRS requirements for tax deduction purposes on donated or estate property valued over $5,000.

An individual meeting IRS requirements to perform qualified appraisals, including education, experience, and professional credentials.

The actual transaction price achieved when an asset is sold, including all premiums and fees.

The cost to replace an item with one of like kind and quality at current market prices.

The cost to create an exact replica of an asset using the same materials, techniques, and craftsmanship as the original.

High-value personal items individually listed on an insurance policy with specific coverage amounts and detailed descriptions.

Tax provision that resets an inherited asset's cost basis to its fair market value at the owner's death.

A professional valuation conducted specifically to meet IRS requirements for tax reporting, including estate, gift, and charitable donation purposes.

Comprehensive financial advisory services that integrate investment management, estate planning, tax optimization, and other services for high-net-worth clients.