Remember Superstorm Sandy? Think back to those images of New York's Chelsea gallery district and the flooding that destroyed so many pieces of artwork. Artists, collectors and dealers alike were hit hard by the storm. Fine art insurers have said they faced claims of up to half a billion dollars from that storm alone.
Will there be another Superstorm Sandy? Probably, somewhere. Of course, even lower magnitude storms can cause trouble in the art community. And storms, of course, aren't the only threat to collections. Art objects are vulnerable to many mishaps, including theft, fire and water damage.
It goes without saying that you want to protect your beloved personal collection from harm. You put so much energy, time and, yes, money into your artwork, that it would be devastating if anything ever happened to it. Protection comes in many forms. While a glass case might protect your favorite painting from a leaky ceiling, it won’t do much against a tenacious burglar. A vault might protect it from lots of problems, but then you're hiding your collection from yourself and others, negating the point of most art.
Your homeowners insurance policy might be the first place to go for collection protection – and rightfully so. Homeowners policies include coverage for your home’s structure and also your personal belongings, including artwork. Renters insurance also covers personal possessions.
Specifically, your collection will be covered by the personal property protection that's typically included in standard home insurance policies. However, there is a catch when it comes to artwork. Typically, a standard policy limits the amount of coverage for art lost or damaged due to fire, theft or another covered event – and the limit is usually $200. For most collectors, that’s nowhere near enough. However, there are two ways to enhance your coverage. You can either schedule an endorsement onto your homeowners or renters policy or you can purchase an entirely separate personal articles floater.
There are advantages and disadvantages to each. Scheduling an endorsement allows you to continue to work with your existing provider. With this option, you will simply increase the limit on your existing homeowners policy for artwork. You won't have to investigate the reputation of another carrier. In case of a claim, you'll have one place to look for help. On the other hand, a personal articles floater is a separate policy, usually purchased from an insurance provider with expertise in the field. In this case, you would purchase a personal articles floater from a company that specializes in insuring artwork. That type of provider can help you accurately determine the amount of coverage you need based on your collection's value, and it also likely will offer more extensive coverage from a wider range of perils.
Regardless of which option you select, you'll want to have a professional appraisal of your collection. In fact, you should do this even if you aren't required to by your carrier. After all, many people begin their collections when they receive gifts by artist friends. Even though you didn't pay for the piece, it still has value, and you'd be well-served to know the value of what you own.
The appraisal also will provide an inventory of what you own. In the unlikely event of damage or theft of your art collection, having an inventory will speed up the claims process. Start by documenting each piece in your collection and include photographs. One thing to remember, however, is that the monetary worth of a piece of art isn't static; artwork appreciates in value as the art world pays more attention to the artist.
Which insurance choice is right for you? Talk with a licensed insurance agent about what you have and what you need. Don't put it off. You'll never be able to replace what your artwork means to you, but that doesn't mean you should be willing to forfeit the financial investment you've made.
This article was contributed by Carrie Van Brunt-Wiley, Editor of the HomeInsurance.com blog. Carrie has been writing insurance news and consumer information for HomeInsurance.com since 2008. She graduated from the University of North Carolina in Wilmington in 2005 with a B.A. in Professional Writing and Journalism.
(Image at top: Salvaging the basement of Printed Matter after Superstorm Sandy)