Posted By:
Frank WakefieldWhen attempting to buy insurance, first you must have an insurable interest. My wife or I can buy life insurance on me, you guys couldn't unless I authorized it.
To insure a baseball card you must have it. And at that point you create a paper trail of ownership. And maybe basis or value. Realistically, homeowners or renters insurance isn't going to cover nice cards unless you get them scheduled, maybe appraised, and then pay an additional premium. For your wife's jewelry, you might need such an appraisal and then a listing of each item on a schedule to get the jewelry insured.
When you die, it would be expected that you still have the cards that you've been insuring. If you don't you must have sold them... and the question of when arrises. And whether you paid tax on the ordinary income from the sale of the card. So tax folks might be looking through old returns to see when you paid that. Or they might go after your estate for the taxes if they don't see where you paid taxes on the ordinary income from the sale of the cards.
In a way, if you get insurance on high value cards, you're insuring that a tax will be paid on them one day, either through inheritance or for ordinary income. That might not be the insurance you really want.