Collecting Art is fun, but maintaining values fluctuate a lot on an insurance policy. All homeowners policies where fine art is a part of the policy are written on a scheduled basis.
To add these artworks to your schedule, the company requires a current bill of sale or a current appraisal. The value is locked based on the schedule, good if the value goes down, bad if the values goes up.
Here is an endorsement which I feel the collector should consider when they are insuring an art collection.
It’s the Current Market Value 150. With this endorsement, the company will pay the amount shown on the Schedule for which the item is insured. However, if the market value of the itemized article immediately before the loss or damage exceeds the amount of itemized coverage for that article, we will pay its “current market value” immediately before the loss or damage up to 150% of the amount of the itemized coverage for that article. Of course, if the item market value decrease you will get less.
For a quote on Fine Art, Collectibles and objects of value click here for the collectors application on my website.
Recently with all the Auction houses in full mode, I have been receiving many phone calls concerning artwork in transit.
The main movement of Art and Collectibles are going to the Auction houses. Most of the time, Individual’s would send the auction house information about the work, and if acceptable, the burden of insurance falls on the collector to get the work to the Auction house.
Most collectors who sell through auction houses, don’t think about coverage while it is at the Auction house. Many Auction houses charge very high rates for this coverage , which in many circumstances are included in my design of the policy.
Granted, you can buy a one-way art or collectibles transit policy that stops once the work is received, or you can think beyond and purchase a policy which at times include insurance coverage while shipping to Auction Houses, Galleries, Storage, and framers.
Complete my form for collectors, and let’s figure out an Art Insurance program which fits your style.
William G. Fleischer, CIC
In-Vault Jewelry: Itemized jewelry described in the Coverage Summary as “in-vault” must be kept in a bank vault.
There is no coverage for these items while they are out of a vault unless we agree in advance to cover them.
Be careful, no coverage for jewelry in home safes.
Jewelry Quotes click here
The loss of market value is determined as follows:
if the amount of itemized coverage for the article is less than the market value immediately before the loss, we will apply the percentage change to the market value immediately before the loss.
If the amount of itemized coverage for the article is equal to or greater than the market value immediately before the loss, we will apply the percentage change to the amount of itemized coverage for that article.
“Percentage change” means the change in market value resulting from the covered loss, after restoration if any, expressed as a percentage.
Recently, while I was discussing art with an attorney, UCC filings came up. Usually, this is filed when you take out a business or personal loans and the lender to protect its collateral files the UCC with the state.
It’s an inexpensive file, which is used to notify the state you are a lender and have claim to the object corresponding to the UCC.
So I always tell everyone when you lend for sale your Art, to always have an expiration of consignment, in case the other party gets in financial difficulties the asset reverts to you at the end of the consignment date.
But now adding the UCC you attach yourself to the asset so any court can recognize you are in line to be paid if the art is sold.
An interesting layer of protection from an unstable partnership.
Because I am always receiving all sorts of art related information I have decided to share some excerpts.
This is from a Zurich informational flyer. Its a helpful flyer breaking down various aspect’s, like:
Understand how to Assess the risk, climate control for fine arts and Antiques, placement of rugs and carpets away from fireplaces. The flyer gets into special care for paintings, moving art, security advice and professional valuations and photographs. it’s worth a quick read.
Click here for an application to insure your Art and antiques.
William G. Fleischer, CIC
29 Broadway, Suite 1511
New York NY 10006
212 566-1881 ext. 111
When you buy a piece of art, can you be sure it’s really yours? Many collectors don’t always feel certain on that score. They worry in some cases that after they make a purchase someone will show up, maybe years later, and claim the art was stolen at some point in the past—ultimately leaving the new owner empty-handed, without the art or the money paid for it.
That’s one reason many art advisers and lawyers recommend title insurance, which can at least partially protect a collector’s financial interests if a piece of art has to be surrendered. But theft isn’t the only issue. Title insurance also can help protect collectors if the person they bought art from becomes entangled in divorce, bankruptcy, probate or other legal proceedings that question the seller’s right to dispose of the art.
Some advisers say title insurance is particularly important because of the sharp increase in the prices of many artworks in recent years—buyers have more to lose. But title insurance has been a hard sell.
William Fleischer, president of insurance brokerage firm Bernard Fleischer & Sons Inc., says most collectors are willing to forgo the cost, in part because many already have paid advisers and lawyers to check on the authenticity and history of ownership of their art, and they have confidence in those experts.
For those who want additional reassurance, some insurance companies offer “defense of title” coverage, which typically pays up to $100,000 in legal costs in the event of a title dispute but doesn’t reimburse policyholders for the value of any objects taken away from them.
The leading provider of more-complete coverage is New York-based ARIS Title Insurance Corp., a unit of Argo Group International Holdings Ltd. It offers policies that cover legal costs in the event of a title dispute and the full purchase price of the piece if the buyer has to surrender the work. Collectors pay a one-time premium averaging 2% to 3% of the purchase price of the item being insured. They can increase coverage, for an additional premium, if the artwork’s value appreciates.
Mr. Grant is a writer living in Amherst, Mass. He can be reached at firstname.lastname@example.org.
Original Article link below.
As a broker who sells Art insurance, www.artinsurancenow.com, Antiques and Collectible Insurance nationwide, I can attest to the increase in awareness of Values across collections. May it be Fine Art, Photography, Antiques, Rare books, memorabilia, and all that we collect, is influenced by various media outlets.
There are many ways to position an Art Insurance Policy where it can keep your valuables, relatively current with the market price.
Appraisals cost money, there are endorsements which can be added to policies to increase the value by 150%. Just remember the company will not pay you more than the policy limits or class limits.
Each Carrier, AXA, Chubb, Travelers or Markel, have products which either complement your Homeowner’s policy or have a standalone Policy.
If you are interested in exploring the option you can call me:
William Fleischer, CIC
Bernard Fleischer & Sons, Inc.
New York, NY 10006
212 566-1881 ext 111
Yes, items can be checked into luggage and still be covered, but this is not the best way to ensure coverage under this policy because you will be violating the packing warranty.
The packing warranty is broad enough that it allows the Insured to pack the items, but still must be packed “utilizing procedures and materials to protect the Covered Property.”
What does this mean? It means you can pack a wood carved 12” dish into your luggage, but you cannot insure a Tiffany lamp wrapped in a sweatshirt.
If the item is of art or cultural importance, the country of origin may seize the property. This policy does not cover any Governmental Action.