Since the Covid-19 pandemic, demand for luxury watches has surged, and the industry is poised to grow by $1.78 billion by 2025.1 That growth comes despite the big four watch brands; Rolex, Patek Philippe, Audemars Piguet and Richard Mille, continuing to limit their production runs and restrict allocations - to preserve their exclusivity. In part contributing to a booming second-hand market.2
With a growing consumer preference for high-quality craftsmanship, and prestige pieces,3 watch collecting has never been more popular, with people willing to spend fortunes on rare and collectible watches.4 In 2019 the first and only Patek Philippe Grandmaster Chime in steel, sold for $31 million, becoming the most valuable watch ever sold at auction.4
Whether you are simply an admirer of beautiful timepieces or are a fully-fledged horologist, anyone with a passion for watches, including collectors, will no doubt have played close attention to the recent ‘Watches and Wonders’ fair. Now taking place every year in Geneva, the event brings together around 40 of the world’s biggest watch brands, including Rolex, TAG Heuer, Cartier, Patek Philippe, Tudor, and IWC, showcasing their new releases and latest trends.
More than 300 watches5 were released at the prestigious trade show, from reinvented classics to never-before-seen technical design. Heritage brands to niche watchmakers, whatever your design or brand preference, there was a watch to lust over. Some of the new releases included a left-handed version of Rolex’s GMT Master II, a TAG Heuer Carrera Plasma, adorned with lab-grown diamonds, and Bulgari’s thinnest mechanical watch in the world, to name just a few.6
If ‘Watches and Wonders’ or the growing popularity of prestige watches, has woken your desire to start investing in your own luxury watch collection, take note of some of the factors below before diving in.
How to start a luxury watch collection
Whether you’re a brand loyalist, a casual collector or a laser-focused watch hunter, you’ll be sure to always find a watch to ignite your passion. With hundreds of luxury watchmakers, each representing a universe unto itself,7 knowing where to start a collection can seem daunting.
There are numerous different schools of thought, and collecting philosophies, along with various tastes and preferences, but collecting doesn’t need to be complicated. What’s key is finding what you love and value in a watch, so that you can enjoy it for years to come.
As a starting point in building your collection, we’ve highlighted some factors to consider:
- Establish a budget – this will give you clarity on the scope and range of brands you will be able to build into your collection.
- Be realistic – about allocations and be prepared to build a relationship and purchase history with your local or chosen dealership. Perhaps starting with some less exclusive pieces.
- Define your use – for the most part, the watch market is defined by two principal classes: sports watches and dress watches.7 You may want to focus on the one which reflects your lifestyle and interests, or alternatively explore both!
- Include an icon – in your area of interest, there is likely to be an ‘iconic watch’ such as the Rolex Submariner, the Cartier Tank, or the Omega Speedmaster – investing in a classic, even at high secondary market prices, can help root your collection.8
- Trading – if you plan to build a collection to trade, make sure you take good care of your watches, ensuring they are serviced properly, and keep the original boxes and papers. If buying pre-owned or vintage watches, ensure you use a trusted dealer who can guarantee authenticity.
Insuring your luxury watch collection
If you’ve spent time and effort building your watch collection, you’ll want to make sure it’s protected. We know watches can be more than just a beautiful possession, for some they hold special meanings, attributed to a loved one, or a special occasion. Insuring your luxury watch collection is essential, to safeguard against the unforeseen, but it is especially important that your watches are valued correctly.
In the current climate, with the limited supply of luxury watches, matched with a high demand, a booming second-hand market has developed.2 This may mean some of your treasured pieces have increased in value, which whilst positive from an investment perspective, could present an issue if your insurance is out-of-date, and something happens to your watch.
Our Private Clients team can arrange a policy that will offer protection for your collection as it grows in size and value. We can also help carry out valuations of your luxury watches, to ensure you are adequately protected.
Paul Emery MD for Marsh Private Clients comments, “I like to plan around the perfect three watch collection, an everyday stainless steel watch to use and expect to gain a patina of wear over a lifetime, a precious metal piece that can be worn casually or as a dress watch and a sentimental heirloom piece from family. Other than that, buy what you like. There are some fantastic alternative brands like Grand Seiko, independents such as Ming or Horage and some occasional low cost hype pieces such as the recently released Omega/Swatch collaboration, Moonswatch”.
To find out more or to discuss your jewellery insurance or watch insurance with a prestige insurance expert, contact our Marsh Private Clients team today, who will be able to offer guidance on the cover you need.
Sources:
1. https://www.globenewswire.com/The-Global-Luxury-Watch-Market-Growth
2. https://www.cnbc.com/luxury-watch-shortage-drives-growth-of-20-billion-secondhand-market
3. https://www.mordorintelligence.com/luxury-watch-market
4. https://www.gq.com/expensive-watches
5. https://www.gearpatrol.com/overlooked-watches-wonders-geneva-2022
6. https://www.wired.com/watches-wonders-2022
7. https://www.thewatchbox.com/starting-luxury-watch-collection-part-i-where-begin
8. https://www.gq.com/how-to-start-collecting-watches
