How Far Do Consignment Agreements Extend in Fine Art Insurance?

Updated March 2026

TL;DR: Most dealer policies value art received on consignment at the agreed value plus 10%. When dealers send works to other galleries, coverage and valuation depend on specific policy language — it oftenfalls into grey areas like “property sold but not delivered.” Always verify with your carrier or specialist broker at ArtInsuranceNow.com.

I was speaking with an art dealer recently while reviewing a proposal for her business. As we went through the quote, she raised a familiar but important question about consignments in fine art insurance.

Dealers typically receive works on consignment from artists and collectors — that part is straightforward. But what happens when a dealer consigns artworks to another dealer or gallery? How does coverage apply when the roles reverse?

What Does the Standard Dealer Policy Say About Property on Consignment?

Direct Answer: Under standard fine art dealer forms, property on consignment to the insured dealer is valued at the agreed consignment value plus 10%. This protects the owner while covering the dealer’s administrative and marketing expenses.

When I reviewed the policy forms for clarity, the Valuation section states: “Property on consignment: valued at the agreed consignment value plus 10%.”

One underwriter confirmed this typically applies when the insured is the consignee (receiving the art), ensuring the original owner is made whole.

Does Coverage Extend When You Send Art on Consignment to Another Gallery?

Direct Answer: The standard clause focuses on art consigned to you. When your gallery sends works out on consignment to another dealer, coverage is less automatic and depends on the carrier’s interpretation and your specific endorsements.

This is where many dealers get surprised. Another clause in some policies reads: “Property sold but not delivered and/or while in transit to the consignee’s or owner’s premises shall be valued at the selling price plus any accrued expenses from the date of sale.”

Valuation Challenges During Transit to the Consignee

Direct Answer: If the artwork is in transit to another gallery and has sold, insurers may apply either the selling price plus expenses or a dealer valuation method (such as cost plus 20–30% or selling price minus commission) depending on whose policy the claim is filed with.

One carrier offered a broader view: “A consignment is a consignment — whether it’s to the dealer or among dealers.” However, the classic insurance answer remains: “Maybe… it depends.”

This grey area is exactly why expertise matters in fine art insurance and collectibles coverage at ArtInsuranceNow.com.

For more on protecting inventory while it travels between galleries and shows, check our guide to fine art transit insurance options for dealers.

Key Takeaways

• Review your dealer policy’s consignment clause carefully
• Consider specific endorsements for outbound consignments
• Document all consignment agreements thoroughly
• Work with a specialist broker at ArtInsuranceNow.com

Frequently Asked Questions

Does standard gallery insurance cover outbound consignments automatically?

No. Most policies focus on inbound consignments to the insured. Outbound consignments may require review or additional coverage confirmation.

How is art valued while in transit under a consignment agreement?

Typically at selling price plus expenses or agreed dealer valuation. Always confirm with your underwriter for your specific situation.

Should art dealers get a separate endorsement for inter-gallery consignments?

Yes, in many cases. Speaking with an experienced fine art insurance specialist at ArtInsuranceNow.com is recommended.

Call our New York office today at 800.921.1008 or 212.566.1881 ext. 111.