ART INSURANCE

Sr. No 1 2

Content Overview of Insurance Introduction to Art Insurance "a#uation of Art

Page No. 2-12 1 -1! 1$-2% 2!- * 1- 2 - % ! $-&1 &2-& &&-&$ &2-+2 +& ++

& + % ! $ 2 1* 11 12 1

Procedure for c#ai'ing insurance (o#ic) T)(e of art , insurance co'(anies covering wit- t-e art insurance "arious arts insured .wor#dwide- i'ages/ Art insurance in India 1* ste(s to 0now a1out t-e art insurance. 3uture of art insurance Surve) Case stud) on insurance co'(an) (roviding Art insurance Conc#usion 4i1#ogra(-)

ART INSURANCE

5Art is a tec-ni6ue of co''unication7and t-e i'age is t-e 'ost co'(#ete tec-ni6ue of a## co''unication.8

INTRODUCTION: Insurance is an arrange'ent w-ere t-e #osses e9(erienced 1) a few are e9tended over severa# w-o are e9(osed to si'i#ar ris0s. Insurance is a
2

ART INSURANCE

(rotection against financia# #oss arising on t-e -a((ening of an une9(ected event. Insurance co'(anies co##ect (re'iu' to (rovide securit) for t-e (ur(ose. As #oss is (aid out of t-e (re'iu' co##ected fro' t-e insuring (u1#ic and t-e insurance co'(anies act as trustees to t-e a'ount so co##ected.

Insurance is a too# 1) w-ic- fata#ities of a s'a## nu'1er are co'(ensated out of funds .(re'iu' (a)'ent/ co##ected fro' (#enteous. Insurance co'(anies (a) 1ac0 for financia# #osses arising out of occurrence of insured events: e.g. in (ersona# accident (o#ic) deat- due to accident: in fire (o#ic) t-e insured events are fire and ot-er a##ied (eri#s #i0e riot and stri0e: e9(#osion: etc. ;ence: insurance is safeguard against uncertainties. It (rovides financia# reco'(ense for #osses suffered due to incident of unantici(ated events: insured wit-in (o#ic) of insurance. EVOLUTION OF INSURANCE: <arine insurance is t-e o#dest for' of insurance fo##owed 1) #ife insurance and fire insurance. T-e -istor) of insurance can 1e traced 1ac0 to t-e ear#) civi#i=ation. As civi#i=ation (rogressed: t-e incidences of #osses started increasing giving rise to t-e conce(t of #oss s-aring. T-e Ar)ans t-roug- t-eir vi##age co-o(eratives (racticed #oss of (rofits insurance. T-e <editerranean 'erc-ants a#so (racticed it in t-e 1&t- centur) t-roug- t-e issue of 4otto'r) 4onds. T-e Code of <anu indicates t-at t-ere was t-e (ractice of 'arine insurance carried out 1) t-e traders in India wit- t-ose of Sri#an0a: Eg)(t and >reece. T-e ear#iest transaction of insurance as (racticed toda) can 1e traced 1ac0 to t-e 1&t- centur) A.?. in Ita#) w-en s-i(s were on#) 1eing covered.

ART INSURANCE

T-is (ractice of <arine Insurance gradua##) s(read to @ondon and during t-e 1%tcentur) it was esta1#is-ed in t-e 'ercanti#e transactions. T-e -istor) of <arine Insurance is c#ose#) #in0ed wit- t-e origin and rise of t-e @#o)ds S-i( owners. T-e @#o)dAs Act was fra'ed to set-u( t-e @#o)dAs 1) w-o' t-e) were e'(owered to transact ot-er c#asses of insurance. Toda): @#o)dAs is regarded as t-e #argest insurance underwriter in t-e Bor#d. MEANING: It is a co''on#) ac0now#edged (-eno'enon t-at t-ere are count#ess ris0s in ever) s(-ere of #ife. 3or (ro(ert): t-ere are fire ris0sC for s-i('ent of goods: t-ere are (eri#s of seaC for -u'an #ife t-ere are ris0s of deat- or disa1i#it)C and so on. T-e c-ances of occurrences of t-e events causing #osses are 6uite uncertain 1ecause t-ese 'a) or 'a) not ta0e (#ace. T-erefore: wit- t-is view in 'ind: (eo(#e facing co''on ris0s co'e toget-er and 'a0e t-eir s'a## contri1utions to t-e co''on fund. B-i#e it 'a) not 1e (ossi1#e to te## in advance: w-ic- (erson wi## suffer t-e #osses: it is (ossi1#e to wor0 out -ow 'an) (ersons on an average out of t-e grou(: 'a) suffer #osses. B-en ris0 occurs: t-e #oss is 'ade good out of t-e co''on fund. In t-is wa): eacand ever) one s-ares t-e ris0. In fact: t-e) s-are t-e #oss 1) (a)'ent of (re'iu': w-ic- is ca#cu#ated on t-e #i0e#i-ood of #oss. DEFINITION: 5It is a for' of a contract or agree'ent under w-ic- one (art) agrees to (a) in return of consideration an agreed a'ount of 'one) to anot-er (art) to 'a0e good t-e #oss: da'age or inDur) due to so'e uncertain event in w-ic- t-e insured -as interest.8

&

ART INSURANCE

NATURE OF INSURANCE: On t-e 1asis of t-e definition of insurance: one can o1serve its fo##owing c-aracteristicsE 1. RISF S;ARIN> AN? RISF TRANS3ERE Insurance is a 'ec-anis' ada(ted to s-are t-e financia# #oses t-at 'ig-t occur to an individua# or -is fa'i#) on t-e -a((ening of a s(ecified event.

2.

CO-OPERATI"E ?E"ICEE Insurance is a coo(erative device under w-ic- a grou( of (ersons

w-o agree to s-are t-e financia# #oss 'a) 1e 1roug-t toget-er vo#untari#) or t-oug- (u1#icit) or t-roug- so#icitations of t-e agents. An insurer wou#d 1e una1#e to co'(ensate a## t-e #osses fro' -is own ca(ita#. So: 1) insuring a #arge nu'1er of (ersons: -e is a1#e to (a) t-e a'ount of #oss. @i0e a## coo(erative devices: t-ere is no co'(u#sion -ere on an)1od) to (urc-ase t-e insurance (o#ic).

RISF ASSESS<ENT IN A?"ANCEE Insurance co'(anies are ris0 1earers. T-erefore: t-e ris0 is eva#uated

1efore insuring to c-arge t-e a'ount of s-are of an insured: -erein ca##ed: consideration: or (re'iu'. T-e (ro1a1i#it) t-eor) is used to eva#uate t-e ris0s.

&.

CO<PENSATION AT T;E OCCURRENCE O3 CONTIN>ENCGE

ART INSURANCE

T-e co'(ensation is 'ade at a certain contingenc) insured. If t-e contingenc) occurs: (a)'ent is 'ade. Since t-e #ife insurance contract is a contract of certaint): 1ecause t-e contingenc): t-e deat- or t-e e9(ir) of ter': wi## certain#) occur: t-e (a)'ent is certain.

+.

A<OUNT O3 PAG<ENTE On t-e occurrence of t-e contingenc): t-e insurer is #ega##) 1ound

to 'a0e good t-e financia# #oss suffered 1) t-e insured. T-e a'ount of (a)'ent de(ends u(on t-e va#ue of #oss occurred due to t-e (articu#ar insured ris0 (rovided insurance is t-ere u( to t-at a'ount. %. ;U>E NU<4ER O3 INSURE? PERSONSE To 'a0e t-e insurance c-ea(er: it is essentia# to insure #arger nu'1er of (ersons or (ro(ert) 1ecause t-e #esser wou#d 1e cost of insurance and so: t-e #ower wou#d 1e (re'iu'.

!.

IN"EST<ENT PORT3O@IOE Since insurerAs co##ect (re'iu's initia##) and 'a0e (a)'ent #ater

w-en .e.g. t-e insured (ersonAs deat-/ or if .e.g. an auto'o1i#e accident/ an insured event occurs: insurance co'(anies 'aintain t-e initia# (re'iu's co##ected in an invest'ent (ortfo#io: w-ic- generates a return. T-us: t-e insurers -ave two sources of inco'eE t-e insurance (re'iu' and t-e invest'ent inco'e: w-icoccur over ti'e.

ART INSURANCE

FUNDAMENTAL PRINCIPLES OF INSURANCE:

ART INSURANCE

Insurable Interest
Utmost Good Faith

Principle of Indemnity

Principle of Causa Proxima

Principle of Insurance
Principle of Contribution

Principle of Loss Minimization

Principle of Subrogation

FUNCTIONS OF INSURANCE:

ART INSURANCE

Insurance (rovides insurance (o#icies: w-ic- are #ega##) 1inding contracts for w-ic- t-e (o#ic)--o#der (a)s insurance (re'iu'. 4ased u(on t-is: t-e functions of insurance 'a) 1e discussed as fo##owsE 1. CERTAINTGE Insurance (rovides certaint) of (a)'ent for t-e ris0 of #oss. T-ere are different t)(es of uncertaint) in a ris0. T-e ris0 wi## occur or not: w-en wi## occur: -ow 'uc- #oss wi## 1e t-ereH In ot-er words: t-ere are uncertaint) of -a((ening of ti'e and a'ount of #oss. Insurance re'oves a## t-ese uncertaint) and t-e assured is given certaint) of (a)'ent of #oss. T-e insurer c-arges (re'iu' for (roviding t-e said certaint).

2. PROTECTIONE T-e 'ain function of t-e insurance is to (rovide (rotection against t-e (ro1a1#e c-ances of #oss. T-e insurance guarantees t-e (a)'ent of #oss and t-us (rotects t-e assured fro' sufferings. T-e insurance cannot c-ec0 t-e -a((ening of t-e event 1ut can co'(ensate for #osses arising at t-e -a((ening of t-e ris0 event. . RISF S;ARIN>E B-en ris0 ta0es (#ace: t-e #oss is s-ared 1) a## t-e (ersons w-o are e9(osed to t-e ris0. T-e s-are is o1tained fro' eac- and ever) insured in t-e s-a(e of (re'iu' wit-out w-ic- t-e insurer does not guarantee (rotection.

&. ASSISTS IN CAPITA@ 3OR<ATIONE

ART INSURANCE

T-e insurance (rovides ca(ita# to t-e societ). T-e accu'u#ated funds are invested in (roductive c-anne#. T-e scarcit) of ca(ita# of t-e societ) is 'ini'i=ed to a greater e9tent wit- t-e -e#( of invest'ent of insurance.

+. PRE"ENTION O3 @OSSE T-e insurance co'(anies assist financia##) to t-e -ea#torgani=ation: fire 1rigade: educationa# institutions and ot-er organi=ation: w-icare engaged in (reventing t-e #osses of t-e 'asses fro' deat- or da'age. T-e insurance Doins -ands wit- t-ese institutions in (reventing t-e #osses of t-e societ) 1ecause t-e reduction in #oss causes #esser (a)'ent to t-e assured and so 'ore saving is (ossi1#e w-ic- wi## assist in reducing t-e (re'iu'. @esser (re'iu' invites 'ore 1usiness and 'ore 1usiness cause #esser s-are to t-e assured.

1*

ART INSURANCE

CLASSIFICATION OF INSURANCE:

Classification of Insurance
Miscellaneous Insurance

Life Insurance

Fire Insurance

Marine Insurance

Social Insurance

Motor Insurance

Acci ent Insurance

Dut! Insurance Contractor#s All Ris" Insurance Pro uct Lia'ilit! Insurance Mac$iner! Loss of Profits Polic!

Erection All Ris"s Insurance

Mac$iner! %rea" o&n Insurance

Refri(eration Plant Insurance

Cas$ Insurance

%usiness Pre)ises %ur(lar! Insurance

Office Protection Insurance

Personal Pac"a(e Insurance Polic! for %usiness)en

S$o*"ee*er#s Insurance Polic!

Rural Insurance

+ouse +ol er#s Insurance Polic!

Do)estic Tra,el Insurance

Ra-es$&ari Ma$ila .al!an %i)a /o-na

S*ecial Contin(enc! Polic!

Art insurance

A)art!a Si"s$a /o-na Insurance Polic!

11

En(ineerin( Insurance

ART INSURANCE

0Criticis) is eas!1 art is ifficult23

12

ART INSURANCE

ART INSURANCE INTRODUCTION: I. B-at is ArtH It is not on#) e9(ensive (aintingsC it a#so inc#udes t-e fondness and #ove forE Scu#(tures "isua# Arts J cera'ics: 'ura#s: wor0s on (a(er Anti6ues: Co##ecti1#es Jrare sta'(s "intage ve-ic#es It cou#d 1e an o1Dect su1Dect to va#ue a((reciation due to age: descri(tion: -istor) and rarit).

Insurance of art is 1ased on a va#uation t-atKs acce(ta1#e to 1ott-e insurer as we## as t-e insurance co'(an). As art 1eco'es 'ore and 'ore va#ua1#e: art insurance is a1so#ute#) essentia#. "a#uation of (aintings is 1ased on 'ar0et feed1ac0 and individua# co##ectors can avai# of t-e (o#ic) as we##. T-is is a new 'ar0et and so initia##): art insurance is ver) e9(ensive. 4ut as 'ore and 'ore (eo(#e are #oo0ing at art as an invest'ent: insuring oneKs co##ection is definite#) in order.

ART INSURANCE

NEED OF ART INSURANCE:

T$e Screa) LT-e Screa'L and L<adonna:L two 'aDor (aintings 1) fa'ous Norwegian artist Edvard <unc-: were sto#en severa# )ears ago fro' t-e <unc- <useu' in Norwa) 1) ar'ed ro11ers in 1road da)#ig-t. T-e significance of t-e art t-eft is nota1#e: 1ut w-atKs rea##) s-oc0ing is t-at t-e art was not insured against t-eft .a#t-oug- it was insured for fire and water da'age: for restoration costs t-at wou#d 1e incurred to re(air t-e (aintings if t-e) were da'aged/. According to a 44C news stor): Mo-n O)aas: 'anaging director of t-e 'useu'Ks insurers: said of t-e (aintings: LT-e) are not re(#acea1#e so )ou canKt 1u) KT-e Screa'K on t-e street and (ut a co() u( t-ere. T-e focus is on ot-er issues t-an insuring t-e'. To a certain e9tent t-is is co''on (ractice 1ecause t-ese ite's arenKt re(#acea1#e.L

Now according to t-e state'ent: <r. O)ass a((ears to 1e sa)ing t-at t-e (aintings are so va#ua1#e t-at t-e)Kre not wort- insuring: or (ut anot-er wa): since t-e (aintings are not re(#acea1#e: insuring t-e' is a waste of 'one). T-is t-in0ing 'a0es a1so#ute#) no sense. T-e 'useu' s-ou#d -ave -ad t-eft insuranceC a## 'useu's s-ou#d -ave t-eft insurance: as s-ou#d a## art ga##eries

1&

ART INSURANCE

and (rivate co##ections. B-et-er or not a wor0 of art is Lre(#acea1#eL is not t-e issue. T-e issue is getting co'(ensated if t-e art is sto#en. B-atKs 1etter-- a sto#en (ainting and a N+ 'i##ion insurance sett#e'ent or a sto#en (ainting and a N* insurance sett#e'entH

Bor#d over invest'ents in fine arts -as grown over 1) ++O annua##). T-e (ossession of 3ine Arts is a s)'1o# of confidence: wea#t-: i'age and status. 4esides nowada)s increasing terrorist activities are da'aging 'an) va#ua1#e , anti6ue co##ections. So for (rotection against t-e #oss incurring fro' suc- activities insurance are re6uired.

42 5$o can 'u! Art Insurance6 Art insurance can 1e ta0en for various "intage , Anti6ue t-ings and it can issued 1) various (artiesE Art @overs Private co##ectors J individua#s and cor(orate. Art ?ea#ers. Art >a##eries. Art 3und. Bare-ousing Service Providers

1+

ART INSURANCE

42 +o& to 'u! art insurance6 If )ou -ave an insurance 1ro0er )ou #i0e: )ou 'ig-t start t-ere: 1ut on#) if t-e agent is eit-er wi##ing to dea# wit- s(ecia#i=ed insurers or -ave (ro(er 0now#edgea1#e a1out art. LGou donAt want to sa) t-e na'e of an artist and -ave t-e 1ro0er go: P;u-HA:L

42 +o& )uc$ &ill it cost6 It is said t-at t-eft insurance is wa) too e9(ensive. T-e cost of insuring a 'useu'Ks entire co##ection is (ro-i1itive: 1ut t-ieves donKt nor'a##) stea# t-e entire co##ection. T-e) on#) stea# (art of it: and usua##) a (rett) s'a## (art. So insure on#) a (art of it. T-eft insurance covers Lincidents:L not s(ecific wor0s of art: un#ess t-e insured s(ecifies individua# coverage for s(ecific wor0s of art in t-e (o#ic). In ot-er words: if )ou (urc-ase t-eft insurance: )ouKre insured for t-e coverage a'ount no 'atter w-at gets sto#en. 7%ut insurin( e,en fe& )ost ,alua'le *aintin(s is still too e8*ensi,e27 It is suggested t-at one can (a) as 'uc- insurance as -e can afford. T-at wa): if art gets sto#en: at #east one -ave enoug- 'one) to -ire to( 6ua#it) (rivate investigators to tr) and recover it: get (u1#icit) for t-e t-eft: or (er-a(s even (a) a ranso'. Or use t-e 'one) to 1u) a state-of-t-e-art securit) s)ste' for t-eir 'useu' .or ga##er) or (rivate co##ection/ so t-at t-eft doesnKt -a((en again. 3orget a1out w-et-er or not art is re(#acea1#e or uni6ue or iconicC receiving co'(ensation for a t-eft is w-at counts: and using t-at co'(ensation to eit-er recover t-e art or 'a0e #ife 'ore difficu#t for (eo(#e w-o stea# art: so difficu#t: -o(efu##): t-at 'an) wi## sto( stea#ing it.

1%

ART INSURANCE

MONA LISA9 T-e 'ost e9(ensive (ainting in t-e wor#d

0Art is ne,er finis$e 1 onl! a'an one 23

VALUATION OF ART:

1!

ART INSURANCE

T-ere are two different (rogra's avai#a1#e to cover 3ine Arts. It is i'(ortant to understand t-e differences in coverage and w-at is necessar) to secure coverage. 3o##owing are t-e two different (o#icies w-ic- can 1e used to cover an) 3ine ArtE 1. 3ine Arts .Sc-edu#ed/ and 2. S(ecies-3ine Arts and @i1rar) Co##ections .Unsc-edu#ed/. 3o##owing e9(#anation descri1es t-e difference 1etween t-ese two (o#icies: t-e coverage avai#a1#e and t-e (rocedures for securing coverage and re(orting #osses. FINE ARTS :Sc$e ule ;: A2 GENERAL DESCRIPTION OF FINE ARTS POLIC/: It is on#) to 1e used as a guide#ine and is not inc#usive of a## of t-e ter's: coverageAs: e9c#usions: #i'itations and conditions of t-e actua# insurance (o#ic). S(ecific 6uestions and discussions regarding coverage s-ou#d 1e addressed t-roug- Ca'(us Ris0 <anage'ent or t-e Office of Ris0 Services.

%2 NAMED INSURED: A## cor(orations: (artners-i(s: Doint ventures: organi=ations: and ot-er entities: as -ave e9isted or as now or 'a) -ereafter e9ist: or for w-ic- it is re6uired to or -as agreed to 'aintain insurance: inc#uding an) affi#iated: associated: a##ied: and su1sidiar) entities. C2 TERRITOR/:

1$

ART INSURANCE

Coverage is (rovided wor#dwide: e9ce(t for t-e fo##owing countriesE Israe#: Ira6: Iran: Afg-anistan: A#1ania: 4u#garia: @i1)a: @i1eria: Cu1a: T-e C=ec- or S#ova0 Re(u1#ics: ;ungar): Po#and: or an) of t-ose territories for'er#) co'(rising and 0nown as t-e Union of t-e Soviet Socia#ist Re(u1#ics and t-e for'er countr) of Gugos#avia. T-e countries #isted a1ove are e9c#uded as a resu#t of t-e 0nown e9istence of art t-eft rings and t-e -igfre6uenc) of art t-eft. D2 LIMITS OF INSURANCE: Per'anent Co##ections and E9-i1its N+*:***:*** at an) ca'(us #ocation .(er #oss/ N2*:***:*** at an) ot-er #ocation or in transit N2*:***:*** eart-6ua0e aggregate (er ca'(us N+*:*** su1-#i'it for fi#' J Pro(ert) of Ot-ers 3oreign Trans(ortation and E9-i1its N+:***:*** an) one #oss.

F2 COVERED PROPERT/: Per'anent Co##ections Bor0s of art: inc#uding (aintings: etc-ings: drawings: .inc#uding t-eir fra'es: g#asses and s-adow 1o9es/: (ictures: statuar): rare 1oo0s: 'anuscri(ts: rugs: ta(estries: and ot-er 1ona fide wor0s of art: or rarit): -istorica# va#ue: or artistic 'erit: inc#udingE Pro(ert) of t-e Insured. Pro(ert) of ot-ers on e9tended #oan to t-e Insured for a (eriod of si9 'ont-s or 'ore. Pro(ert) of ot-ers offered as gifts to t-e Insured or for sa#e to t-e Insured and w-i#e awaiting for'a# acce(tance 1) t-e Trustees.

12

ART INSURANCE

T-e InsuredAs interest in residuar) gifts and Doint#) owned (ro(ert): 1ut on#) to t-e e9tent of t-e InsuredAs interest t-erein at t-e ti'e of t-e #oss or da'age. G2 COVERED PERILS: Per'anent Co##ections and E9-i1its a## ris0s of (-)sica# #oss or da'age fro' an) e9terna# cause: e9ce(t as e9c#uded. Pro(ert) in Transit a## ris0s of (-)sica# #oss or da'age fro' an) e9terna# cause: inc#uding Overseas Transit. +2 PERILS E<CLUDED: 3o##owing are t-e various e9c#usions w-ic- are not covered under an) art insurance (o#ic)E Natura# ageing. >radua# deterioration. In-erent defect. RustQo9idation: 'ot-: ver'in: war(ing: s-rin0ing. @oss during re(airing: refra'ing: restoring: retouc-ing. Aridit): -u'idit): e9(osure to #ig-t: -eat un#ess caused 1) fire: stor'Q frost etc. @oss 1) co##usion of (artner: director. Inventor) #oss. At fairs un#ess notified. Bar and war #i0e activit). Terroris'

2*

ART INSURANCE

I2 VALUATION: Pro(ert) of t-e Insured s-a## 1e va#ued at t-e current 'ar0et va#ue of t-e (ro(ert) at t-e ti'e an) #oss or da'age occurs. T-e #oss or da'age s-a## 1e deter'ined according to suc- current 'ar0et va#ue. Pro(ert) ac6uired or to 1e ac6uired 1) t-e insured as a gift or under wi##s or si'i#ar re6uests s-a## 1e va#ued at t-e current 'ar0et va#ue at t-e ti'e t-e #oss or da'age occurs. T-e (o#ic) wi## not cover suc- (ro(ert) 1e)ond t-e co'(anies interest t-erein and in t-e event of #oss of suc(ro(ert): t-e interest of t-e co'(an) at t-e ti'e of t-e #oss s-a## 1e t-at as sti(u#ated in t-e wi##: 1e6uest: contract or ot-er docu'ent e9ecuted 1etween t-e co'(an) and t-e owner of t-e said (ro(ert). Pro(ert) of ot-ers #oaned to t-e insured and w-ic- t-e insured -as 1een instructed to insure: or for w-ic- t-e insured 'a) 1e #ia1#e: s-a## 1e va#ued at a'ounts agreed u(on 1) t-e insured and owners. In t-e a1sence of an agree'ent: t-e insurance (o#ic) wi## not 1e #ia1#e 1e)ond t-e current 'ar0et va#ue of t-e (ro(ert) at t-e ti'e t-e #oss or da'age occurs and in no event for an a'ount in e9cess of t-at s(ecified in t-e (o#ic).

=2 IN T+E EVENT OF A LOSS

21

ART INSURANCE

A## #osses s-a## 1e (ro'(t#) re(orted to t-e Ca'(us Ris0 <anage'ent Office and t-e Office of Ris0 Services: Office of t-e President. A## incidents invo#ving t-eft or vanda#is' s-ou#d a#so 1e re(orted to t-e ca'(us andQor #oca# (o#ice de(art'ent. Ta0e reasona1#e e'ergenc) 'easures to 'itigate an) furt-er da'age.

22

ART INSURANCE

SPECIES9FINE ARTS AND LI%RAR/ COLLECTION

A2 GENERAL DESCRIPTION OF SPECIES9FINE ARTS AND LI%RAR/ COLLECTION: T-is (o#ic) (rovides coverage for unsc-edu#ed and 'isce##aneous ite's t-at are not re(orted under t-e 3ine Arts Insurance Po#ic) descri1ed a1ove. T-e coverage descri1ed 1e#ow is a su''ar) of t-e insurance (o#ic)C -owever: it is on#) to 1e used as a guide and is not inc#usive of a## of t-e ter's: coverage: e9c#usions: #i'itations and conditions of t-e actua# insurance (o#ic). S(ecific 6uestions and discussions regarding coverage s-ou#d 1e addressed t-roug- t-e Office of Ris0 Services. %2 NAMED INSURED: A## cor(orations: (artners-i(s: Doint ventures: organi=ations: and ot-er entities: as -ave e9isted or as now or 'a) -ereafter e9ist: or for w-ic- it is re6uired to or -as agreed to 'aintain insurance: inc#uding an) affi#iated associated: a##ied: and su1sidiar) entities. C2 TERRITOR/: Coverage is (rovided wor#dwide. D2 LIMIT OF INSURANCE: T-is (o#ic) (rovides #i'its of N1:***:***:*** e9cess of a N1:***:*** deducti1#e. C#ai's fa##ing wit-in t-e N1:***:*** deducti1#e wi## 1e covered and su1Dect to t-e fo##owing sc-edu#e of deducti1#es.

ART INSURANCE

E2 COVERED PROPERT/E A## for's of 3ine Art of an) nature or descri(tion and @i1rar) Co##ections of an) nature or descri(tion: inc#uding 1ut not #i'ited toE "o#u'es: seria#s received current#): (ersona# 'anuscri(ts: UC arc-iva# 'anuscri(ts: ot-er arc-iva# 'ateria#s: 'a(s: 'icrofi#' ree#s: 'icro cards: 'icrofic-e: 'icro(rints: (a'(-#ets: govern'ent docu'ents: audio discs: audio cassettes: audio ree#s: co'(act discsQdigita# audio: videota(es: videodiscs: 'u#ti-'edia 0its: 'otion (ictures: fi#'stri(s: (ictoria# ite's: + '' s#ides: co'(uter ta(es: 'onogra(-ic C?-RO< discs: seria# C?-RO< discs and f#o(() discs. Co,ere *ro*ert! inclu es: 1. Pro(ert) of t-e Insured. 2. Pro(ert) of ot-ers on #oan to t-e Insured. . Pro(ert) of ot-ers offered as gifts to t-e Insured or for t-e sa#e to t-e Insured and w-i#e awaiting for'a# acce(tance 1) t-e Insured. &. T-e InsuredAs interest in residuar) gifts and Doint#) owned (ro(ert): 1ut on#) to t-e e9tent of t-e InsuredAs interest t-erein at t-e ti'e of t-e #oss or da'ageC a## of t-e a1ove 1eing (art of: and 0nown as t-e InsuredAs Per'anent Co##ection: w-i#e on e9-i1ition or ot-erwise: and w-i#e in transit wor#dwide. +. Pro(ert) of t-e Insured or (ro(ert) of ot-ers #oaned to t-e Insured and w-ict-e Insured -as 1een instructed to insure: covering said (ro(ert) on a 5wa## to

2&

ART INSURANCE

wa##8 1asis fro' t-e ti'e t-e said (ro(ert) is re'oved fro' its nor'a# re(ositor): incidenta# to s-i('ent: unti# returned t-ereto to or ot-er (oint designated 1) t-e owner or t-eir agent (rior to return s-i('ent: inc#uding w-i#e in transit and w-i#e on e9-i1ition or ot-erwise wor#dwide.

F2 COVERED PERILSE A## ris0s of (-)sica# #oss or da'age fro' an) e9terna# cause: e9ce(t as e9c#uded.

G2 PERILS E<CLUDED Bear and tear: gradua# deterioration: 'ot-s: ver'in: in-erent vice: or #oss or da'age sustained due to or resu#ting fro' an) re(airing: restoration or retouc-ing (rocess. BarC invasionC acts of foreign ene'iesC -osti#ities .w-et-er war 1e dec#ared or not/C civi# warC re1e##ionC revo#utionC insurrectionC 'i#itar) destruction or da'age to (ro(ert) under t-e order of an) govern'ent or (u1#ic or #oca# aut-orit). S-i('ents 1) 'ai# un#ess registered first c#ass 'ai# or (arce# (ost (rovided: -owever: suc- s-i('ents 1) (arce# (ost s-a## not e9ceed t-e su' of N1:*** .US?/ in va#ue. Against #oss or da'age to (ro(ert) s-i((ed under 5on dec08 4i##s of @ading. Nuc#ear reaction or radiation: or radioactive conta'ination.

2+

ART INSURANCE

Eart-6ua0e: #ands#ide or su1sidence. NoteE T-e S(ecies-3ine Arts and @i1rar) Co##ection insurance does not insure #oss caused 1) Eart-6ua0e: w-ic- is inc#uded under t-e 3ine Arts Insurance Po#ic).

+2 VALUATION: 1. Pro(ert) of t-e Insured s-a## 1e va#ued u( to t-e current 'ar0et va#ue of t-e (ro(ert) at t-e ti'e an) #oss or da'age occurs in res(ect of nonsc-edu#ed (ro(ert). 2. @i1rar) contents of t-e insured s-a## 1e va#ued as (er t-e sc-edu#ed #i'its set fort- in t-e (o#ic). . Pro(ert) ac6uired or to 1e ac6uired 1) t-e Insured as a gift or under wi## or si'i#ar 1e6uest s-a## 1e va#ued at current 'ar0et va#ue at t-e ti'e t-e #oss or da'age occurs. &. Pro(ert) of ot-ers #oaned to t-e insured and w-ic- t-e insured -as 1een instructed to insure: or for w-ic- t-e insured 'a) 1e #ia1#e: s-a## 1e va#ued at a'ounts agreed u(on 1) t-e insured and owners. I2 IN T+E EVENT OF A LOSS:

2%

ART INSURANCE

1. A## #osses s-a## 1e (ro'(t#) re(orted to t-e Ca'(us Ris0 <anage'ent Office and t-e Office of Ris0 Services: Office of t-e President. 2. A## incidents invo#ving t-eft or vanda#is' s-ou#d a#so 1e re(orted to t-e ca'(us andQor #oca# (o#ice de(art'ent. . Ta0e reasona1#e e'ergenc) 'easures to 'itigate an) furt-er da'age. PROCEDURE FOR CLAIMING INSURANCE POLIC/: A#ong wit- t-e increasing (ortfo#io co'es t-e increased (ossi1i#it) of c#ai's. It is ver) i'(ortant to arrive at an understanding as to

R ;ow to -and#e t-ese c#ai's: so t-at t-e insuredAs 'ust -ave so'e confidence a1out t-e co'(an).

R 4asis of inde'nit) at ince(tion. T-is is necessar) for t-e -ea#t-) growtof t-e 1usiness.

.INDS OF CLAIMS 1. Tota# @oss C#ai's .no great difficu#t) in sett#ing t-is/. 2. Partia# @oss C#ai's .t-is needs attention/.

2!

ART INSURANCE

FOR

CORRECT

SETTLEMENT

OF

CLAIM

T+E

FOLLO5ING STEPS ARE RE4UIRED:

12 Re*ortin( of Clai): 9 C#ai' -as to 1e re(orted to t-e nearest c#ai' office. On#ine: S<S faci#ities are a#so avai#a1#e for suc-. In case of t-eft , fire: c#ai' inti'ation s-ou#d 1e su1'itted a#ong wit- t-e 3IR , 3ire 4rigade re(ort res(ective#). In 1ot- t-e genera# , s(ecia# cases: c#ai' for' -as to 1e du#) fi##ed u( 'anua##) or on#ine. 2. A**oint)ent of sur,e!or:9 >enera# surve)or is usua##) -ired for esti'ating t-e #oss in case of 1oo0s etc. S(ecia#ist surve)ors are re6uired for dea#ing in fine arts 1ecause genera# surve)ors -ave no e9(ertise in 6uantif)ing t-e #oss. Internationa##): art 'ar0et e9(erts are e'(#o)ed for assessing t-ese #osses. After c#ai' is re(orted surve)or wi## go t-roug- t-e (o#ic) (a(ers , va#uation re(ort: t-en t-e assess'ent of t-e #oss was 'ade. 4ut in cases suc- as t-eft: 1urg#ar) etc investigator is a((ointed , a#so t-e c#ai' is not sett#ed un#ess , unti# t-e fina# (o#ice re(ort is received.

2$

ART INSURANCE

. E8*ertise of t$e E8*erts:9 A (ane# of t-e 1est e9(erts avai#a1#e #oca##) w-o are we## res(ected in India and are consu#ted routine#) 1) t-e internationa# 3ine Arts Institutions #i0e: T-e C-risties and Sot-e1)As. T-e e9(erts are used for t-e (ur(ose of va#uation at t-e ti'e of ince(tion of ris0 as we##. T-e va#ue t-at -as done t-e va#uation 1efore co''ence'ent of ris0 is usua##) not a((ointed as surve)or for assess'ent of c#ai' a'ount. In case insured not agreeing wit- t-e assess'ent done 1) t-e e9(ert: one 'ore e9(ert 'a) 1e used in consu#tation wit- t-e insured. E9(erts -ave t-eir own fee and insured s-ou#d -ave a discussion wit- t-e' to arrive at 'utua##) acce(ta1#e fee. In case of (artia# #osses w-ere t-e insured wis-es to surrender t-e wor0: artwor0 can 1e so#d after restoration: in t-e secondar) art 'ar0et. Essentia##) t-e assess'ent of 3ine Arts c#ai' is a negotiation 1etween t-e insurance co'(an): t-e e9(ert: and t-e insured.

PARTIAL LOSS AGREEMENT:9 In case of (artia# #oss agree'ent due to (eri#s insured against: t-e a'ount of #oss s-a## 1e t-e cost and e9(ense of restoration inc#uding additiona# c-arges insured in connection t-erewit-. T-e assured and t-e underwriters s-ou#d agree u(on de(reciation: if an): after restoration. In t-e event if t-e assured and t-e underwriters does not agree on t-e a'ount of de(reciation: (ro(ert) is to 1e so#d at (u1#ic auction and t-e net (roceed goes to t-e account of t-e assured. Underwriters -ave to (a) t-e assured t-e
22

ART INSURANCE

difference 1etween t-e a'ount so rea#i=ed and t-e insured va#ue of t-e (ro(ert). In no event s-a## underwriters 1e #ia1#e for 'ore t-an t-e insured va#ue of t-e (ro(ert). 4esides fo##owing are t-e ot-er (oints a (o#ic) -o#der -as to 0ee( in 'ind 1efore fi#ing a c#ai' for (artia# #ossE

i/ SPECIAL PROVISIONE It is a condition of t-is insurance t-at t-e assured to t-e 1est of t-eir a1i#it): wi## (rovide for t-e (ro(ert) insured -ereunder to 1e (ac0ed: un(ac0ed and s-i((ed 1) co'(etent and or (rofessiona# (ac0ers and s-i((ers. ii; NO %ENEFIT TO %AILEE: It is -ere1) warranted t-at t-is insurance s-a## in no wa) insure direct#) or indirect#) to t-e 1enefit of an) carrier or ot-er 1ai#ee. iii; %U/ %AC. AGREEMENT: In t-e event of #oss -ereunder: for w-ic- underwriters -ave 'ade (a)'ent: underwriters agree to offer t-e assured first c-oice of 1u)ing 1ac0 t-e recovered (ro(ert) if t-e (ro(ert) is recovered wit-in two )ears fro' t-e date of sett#e'ent. It is agreed t-at underwriters 'a) re6uest an a'ount no -ig-er t-an t-e a'ount: w-ic- was (aid 1) t-e' w-en t-e origina# c#ai' sett#e'ent was 'ade #ess an) deducti1#e: if a((#ica1#e. i,; COVER: T-e (ro(ert) descri1ed in t-e attac-ed sc-edu#e .t-e 5Sc-edu#e8/ is insured against (-)sica# #oss or (-)sica# da'age occurring during t-e (eriod of insurance w-i#e at t-e na'ed #ocation.s/ or wit-in t-e

ART INSURANCE

territoria# #i'its s(ecified in t-e Sc-edu#e: su1Dect to t-e fo##owing e9c#usions: 1asis of va#uation and conditions.

T!*es of Art Insurance T-ere are two t)(es of art insurance coverage t-at wi## (rotect a wor0 of fine artE Tit#e and Pro(ert). Tit#e insurance insures against defective tit#e: t-at t-e art wor0 was not sto#en or #ooted. Pro(ert) insurance is si'i#ar to -o'eownerKs insuring against t-eft or da'age. Insurance Co)*anies Co,erin( Art Severa# insurance co'(anies (rovide coverage for fine artE

C$u'' Grou* LC-u11Ks <aster(ieceS "a#ua1#e Artic#es (o#ic): va#ua1#e ite's are covered an)w-ere in t-e wor#d wit- no deducti1#e. B-atever (ossessions )ou insure: )ou wi## -ave t-e c-oice to re(air: re(#ace: or 0ee( t-e cas-.L Atlantic Mutual At#antic <utua#Ks "a#ua1#es Po#ic) (rovides 1road coverage for fine art. A<A Art LATA Art is t-e on#) g#o1a##) o(erating s(ecia#t) art and co##ecti1#es insurance co'(an) offering tai#or-'ade coverage so#utions for (rivate and cor(orate co##ections: 'useu's: ga##eries and artists.L

ART INSURANCE

Tata AIG Pri,ate Client Grou* Tata AI> Private C#ient >rou( (rovides coverage for fine art and rare anti6ues.

Indian insurance 'ar0et is e9(eri'enting wit- t-e nic-e conce(t of art insurance. In t-e #ast + )ears: t-e Indian art 'ar0et -as grown 'ore t-an +**O in sa#es. Aff#uents: )oung entre(reneurs: w-o c-oose art as an invest'ent o((ortunit): and an u(ward trend of t-e Indian art-wor0 co##ectors are t-e 0e) drivers of growt- for art 'ar0et. 5Insurance (otentia# #ies wit- art traders wit- stoc0 va#ue u( to Rs +* crore as it is co'(#ete#) unta((ed. Be fee# t-at on#) 1*-1+O of (otentia# in t-is seg'ent -as 1een ta((ed )et. Be -ave a co'(arative#) s'a## (ortfo#io: )et a (rofita1#e one:8 sa)s RaDive Fu'araswa'i: -ead-ris0 and re-insurance: ICICI @o'1ard >IC @td. 5So'e esti'ate t-at t-e va#ue of art t-at can 1e insured in India tota#s to a1out N1 1i##ion. T-is -as an esti'ated accretion of a1out +O (er annu'. At t-ese #eve#s: we esti'ate t-e (re'iu' (otentia# of t-e art insurance 'ar0et to 1e a1out Rs 1+*-Rs 2** crore overa##:8 sa)s >aurav >arg: <? and c-ief e9ecutive officer: Tata AI>: genera# insurance. Art insurance genera##) covers t-e ris0 #i0e da'age during transit: restoration and fra'ing. T-ere are ris0s associated wit- -and#ing t-e (iece of art wit-in t-e (re'ises of a ga##er) w-ic- can a#so 1e covered. It e9tends covers to natura# (eri#s: accidenta# da'ages and terroris' da'age. T-e target custo'ers for t-e art insurers 'a) 1e art ga##eries: art auction -ouses: art funds: art ware-ousing service (roviders and (rivate co##ectors. Private (#a)ers #i0e ICICI @o'1ard: Tata AI> and 4aDaD A##ian= are t-e 0e) (#a)ers in art insurance in India. Profi#e of t-e insured: #ocation: securit) 'easures and (ast #oss -istor) are so'e of t-e underwriting (ara'eters regarding t-is (o#ic). 5Art insurance is )et to catc- u( due to t-e c-a##enge of va#uation w-ic'a) differ a'ong different va#uators. As insurers re6uire t-e e9act (rice of t-e asset: it usua##) 1eco'es difficu#t to ascertain t-e su' insured a((#ica1#e. A#so: artwor0s suc- as (aintings of scu#(tures re6uire -ig'aintenance in ter's of t-e care ta0en and securit): due to w-ic- insurers 'a) 1e re#uctant to ta0e on t-is ris0:8 sa)s TA Ra'a#inga': -eadunderwriting: 4aDaD A##ian= >enera# Insurance.

ART INSURANCE

VARIOUS ARTS 5+IC+ ARE INSURED:

ART INSURANCE

LOUVRE9 T$e 'i((est )useu) in t$e &orl situate in FRANCE

OSLO Museu) of Nor&a!

Fa)ous NATURE#S *aintin( "e*t in Lou,re

&

ART INSURANCE

Fa)ous A%STRACTS )a e '! PICASSO

T$e Sa Face9 %! Picasso

S$i* of Fools .(ainted c. 1&2*J 1+**/ is a (ainting 1) ;ieron)'us 4oscw-ics-ows (rodiga#

ART INSURANCE

-u'ans wasting t-eir #ives instead of s(ending it in Lusefu#L wa)s. T-e (ainting is dense in s)'1o#is'.

Ma(nificent &or"s of t$e (reat Leonar o Da Vinci

ART INSURANCE

Various Vinta(e Cars t$at are insure &it$ Art Insurance *olic!

ART INSURANCE IN INDIA: T-ere is o((ortunit) for fine arts insurance 1usiness in India: C-ina and Eastern Euro(e. T-ese countries are cu#tura##) ric- and -ave created a #arge a'ount of wea#t-. T-ere are various (rivate co##ectors of fine arts. Prices of fine arts are -ig- and so its (rotection is a#so ver) i'(ortant. 3or instance: a (ainting w-ic- is wort- a 'i##ion do##ars wou#d definite#) re6uire insurance 1ecause an) -ar' done to t-is (ainting wi## definite#) 1e a great #oss to t-e owner.

ART INSURANCE

T-ere -as 1een a s(urt in de'and for conte'(orar) Indian arts. T-e wor0 of t-e Indian artists are creating 'ar0et for t-e (otentia# 1u)ers: #eading to t-e co##ection of t-ose va#ua1#e wor0s w-ic- s-ou#d 1e insured for (rotection against an) #oss. 4esides t-ere is an e9(onentia# growt- in transactions and invest'ents in wor0 of arts in India. A#so: t-e (re and (ost war Indian Art is 'uc- in de'and.

>? ste*s to "no& $o& to o*t for art insurance2 >2 Do I nee art insurance6 Ever) owner of art wi## 0now t-e va#ue Ufinancia##) and e'otiona##)V t-at -e (#aces on -is art. B-et-er )ou are t-e artist w-o wis-es to insure t-e artwor0 )ou -ave created or if )ou are t-e art #over w-o co##ects art: 1e it (aintings andQor scu#(tures: )ou need to (rotect t-e (ieces )ou own. Not on#) owners need to 1e aware of art insurance -1ut a#so t-ose invo#ved in t-e safe0ee(ing of ot-er (eo(#eKs art. Art insurance is re6uired to (rotect fro' financia# #oss. Ever)one: fro' t-e first ti'e art 1u)er: t-e art ent-usiast: t-e art co##ector: t-e artist and t-e ga##erist s-ou#d insure t-eir art. @2 5$at can 'e insure un er a *olic! for art insurance6

ART INSURANCE

Art insurance covers a 'uc- wider s(ectru' t-an 'an) of us 'ig-t 1e aware of. Insurance can 1e (urc-ased to cover (eriod furniture: 1oo0s: car(ets: c#oc0s: go#d: si#ver: (recious 'eta#s: anti6ue Dewe##er): 'a(s: 'eta#ware: 'i#itaria: 'usica# instru'ents: o1Dects dAart: o1Dects of virtue: (aintings: s0etc-es: (rints: (-i#ate#ic: (-otogra(-): (o#itica# 'e'ora1i#ia: (orce#ain: (otter): cera'ics: g#ass: Dade: scientific instru'ents: statues: scu#(tures: s(orting 'e'ora1i#ia: to)s and 'ore. A2 +o& )uc$ insurance o I nee for )! collection6 T-ere is no si'(#e answer to t-is 6uestion as it wi## de(end on t-e circu'stances and t-e needs of t-e s(ecific owner. Gou wi## need to deter'ine t-e va#ue of )our co##ection: (ro1a1#) 1) -aving it (rofessiona##) a((raised. Gou 'a) a#so c-oose not to insure t-e entire co##ectionC instead: )ou cou#d si'(#) cover t-e 'ore va#ua1#e (ieces. It is i'(ortant to 0ee( in 'ind t-at art co##ections can inf#ate in va#ue rat-er 6uic0#) and t-at t-e re6uired cover 'ig-t var) fro' )ear to )ear. B2 +o& )uc$ &ill art insurance cost6 T-is 'ig-t var) significant#) 1etween insurers and are de(endent on t-e ite's and t-eir va#ue to 1e insured. T-e cost of t-e insurance c-anges if t-ere is an added ris0. E9a'(#es of ris0 wou#d 1e t-e c-ance of t-e wor0 1eing sto#en: da'aged or #ost and t-e cost to recover or re(air t-e wor0. T-e costs wi## a#so differ de(ending on w-ere t-e art is to 1e 0e(t or dis(#a)ed. Gou 'ig-t need to insure )our wor0 1ot- at -o'e and for e9-i1ition. Be wou#d #i0e to advise t-at )ou co'(are 1ot- insurers: cover and (ricing t-roug- t-oroug- consu#tation. C2 5$at else o I nee &$en insurin( )! collection6 B-en searc-ing for t-e correct insurance: it is we## wort- co'ing (re(ared. Be wou#d #i0e to advise t-at )ou co##ect and gat-er t-e fo##owing for )our fi#eE

An inventor) #ist. Gou s-ou#d co'(i#e a #ist of s(ecific (ieces )ou wisto insure if )ou are not insuring )our entire co##ection. Proof of (rovenance. B-en )ou ac6uire a (iece of va#ua1#e art: )ou s-ou#d 1e given so'e sort of certification of its origin. It 'a) 1e inc#uded as (art of t-e origina# invoice: w-ic- )ou s-ou#d a#so 0ee(.

ART INSURANCE

P-otogra(-s of t-e artwor0. Not on#) do )ou need to (rove )ou owned t-e wor0: 1ut )ou 'ust a#so s-ow t-e condition it was in at t-e ti'e of (urc-ase U1efore it 'ig-t 1e da'aged or sto#enV.

D2 5$at are t$e t!*ical clai)s un er Art Insurance Policies6 B-et-er )ou are a serious co##ector or individua# w-o owns one or two 'aDor (ieces: )ou need to 0now w-ere t-e financia# vu#nera1i#it) #ies. LT-e 'ost co''on financia# ris0 to art is not t-eft 1ut fire: accidenta# da'age and owners-i( dis(utes:L sa)s >ordon <assie: <? of Artinsure: underwritten 1) ;o##ard: w-o s(ecia#ise on#) in insuring art: 'e'ora1i#ia and anti6ues. T-e 'ost co''on , 'ost e9(ensive c#ai's areE

T-eft P-)sica# da'aged (ieces Art wor0 #ost in fire or f#oods. Accidents t-at arise w-en t-e wor0s are -and#ed: trans(orted or insta##ed.

According to <assieE LOur Artinsure c#ai's records confir' t-at in SoutAfrica fire is (ro1a1#) t-e greatest catastro(-ic ris0 facing )our c#ient regarding t-eir invest'ent in art: anti6ues or co##ecti1#es. And itKs not on#) destruction 1) fire itse#f t-at is t-e (ro1#e'. ?a'age fro' s'o0e and firefig-terKs water can serious#) de(reciate t-e va#ue of )our c#ientKs assets. Effective ris0 'anage'ent inc#udes -aving an insurer wit- t-e ca(acit) and e9(ertise to faci#itate (ost fire res(onse: inc#uding t-e need to secure: sta1i#i=e and restore ite's.8 E2 5$at recor s o !ou nee to "ee* a'out !our art6 Not on#) are records needed w-en insuring t-e wor0s of art: 1ut a#so in t-e unfortunate event of -aving to su1'it a c#ai'. ;o##) A#ai'o of ?ragonf#) >a##er) suggests t-e fo##owingE

Fee( an) sa#es recei(ts Co##ect an) additiona# (a(erwor0 t-at s(ea0s direct#) to t-e va#ue of )our art. Ta0e a (-otogra(- of t-e art and 0ee( it in a securit) 1o9 ;ave an anti6ue (iece assessed 1) an anti6ue eva#uator B-en a (iece is 1) an u(-and-co'ing artist: co##ect infor'ation on t-at artist and add it to )our insurance (ac0et.

&*

ART INSURANCE

It is 1est (ractise to review t-e artwor0 in )our co##ection annua##). A video ca'era can 1e an i'(ortant too# to docu'ent )our (ossessions. F2 Does !our insurer un erstan t$at art often nee s to 'e in transit6 In Sout- Africa: 'ost c#ai's on wor0s of art arise fro' (-)sica# da'age during trans(ortation of t-e wor0 and fro' t-eft of t-e wor0. T-e fre6uenc) of accidenta# da'age #oss is on t-e rise due to t-e a'ount of assets in transit on SAKs roads as we## as t-e condition of our roads. E9a'(#eE An Ard'ore "ase (urc-ased for R2** *** at auction in Octo1er in 2**$ in Ca(e Town arrived in Mo-annes1urg wit- a c-i( on it. 3irst indications are t-at after restoration it wi## 1e wort- R%*:*** J a #oss in va#ue of R1&* ***. Insurance against t-is t)(e of ris0 is vita# to a co##ector and is not t-e t)(e of cover one receives as a 'atter of course. T-is situation is an e9a'(#e of t-e need for s(ecia#ist insurance t-at inc#udes cover for decrease in va#ue as a resu#t (eri#s of t-is 0ind. Art not on#) needs to 1e trans(orted for dis(#a)s: 1ut a#so for restoration and refra'ing. <ost conventiona# insurers (anic at t-e t-oug-t of suc- va#ua1#e ite's 1eing trans(orted: and i'(ose i##ogica# and cost#) securit) 'easures and inf#ated (re'iu's. Gou wi## need to find an insurer w-o is fa'i#iar to t-ese s(ecia# ris0s. G2 Is !our insurance structure usin( t$e a,era(e clause or on an a(ree ,alue 'asis6 On w-at 1asis is )our wor0s of art insuredH Nor'a# insurance: suc- as conventiona# -ouse-o#ders insurance is su1Dect to t-e average c#ause. Art insurance t)(ica##) uses an agreed va#ue 1asis. B-at is 5an agreed va#ue8 of insuranceH T-e agreed va#ue 1asis is an agree'ent 'ade 1etween t-e insurers and insured t-at t-e (a)'ent for da'age or #oss of an ite' wi## 1e t-e va#ue of t-at ite'. If )our art is insured on a conventiona# -ouse-o#ders or co''ercia# (o#ic): )our c#ai's wi## 1e su1Dect to t-e average c#ause. T-is 'eans t-at if )our art invest'ent -as increased in va#ue since )our #ast insurance va#uation: )ou 'a) 1e under insured w-en a c#ai' arises and t-e 'one) (aid to )ou wi## 1e #ess t-an t-e actua# va#ue of t-e artwor0.

&1

ART INSURANCE

>?2 5$! an &$en )i($t it 'e i)*ortant to consi er a s*ecialist art insurer6 S(ecia#i=ation 'ig-t 1e i'(ortant for t-e serious co##ector in t-e event of an e'ergenc). T-is cou#d inc#udeE

E9(erienced 1ac0u( 1) a tea' of (eo(#e wit- t-e e9(ertise to react 6uic0#) and a((ro(riate#) to 'ini'i=e #oss. S(ecia#i=ation cou#d (rovide 1ot- ca(acit) and 0now#edge. Gour insurer 'ust 1e a1#e to assist )ou in understanding )our insurance (o#ic) and t-e fine (rint. A s(ecia#ist insurer 'a) assess )our ris0s and reduce t-e' w-ere (ossi1#e

E9a'(#eE In t-e event of fire s'o0e da'age (enetrates #a)ers of (aint to different #eve#s: de(ending on -eat. T-is re6uires e9(ert and sensitive restoration wor0. ;owever: des(ite t-e 'ost carefu# restoration: an art asset is #i0e#) to de(reciate in va#ue 1) u( to +O.

Paintin( t$e future of art insurance Nic-e insurance (rovider: Pavi#ion Insurance: announces t-e #aunc- of Art guard: a 1rand new art insurance so#ution for owners of art and co##ections t-roug-out t-e UF. T-e (o#ic) covers t-eft: #oss and accidenta# da'age and da'age in transit for a wide variet) of art J ranging fro' (aintings and drawings t-roug- to g#ass and conce(tua# scu#(ture. <ar0eting ?irector >i#es Rees said 5<an) -o'e contents (o#icies donAt cover art un#ess (ieces are s(ecified on t-e (o#ic) and t-is can often #ead to a si=ea1#e increase in (re'iu'8. T-is is confir'ed 1) recent researc- 1) s(ecia#ist insurance co'(an) ;isco9: w-o revea#ed t-at $*O of art co##ectors do not
&2

ART INSURANCE

-ave ade6uate cover for t-eir co##ections and *O -ave never soug-t a va#uation. ;e goes on to sa) 5Art guard -as 1een created to (rovide a s(ecia#ist art insurance (o#ic) w-ic- not on#) offers a cost effective a#ternative: 1ut a#so (rovides ot-er features w-ic- wi## direct#) 1enefit art co##ectors and ent-usiasts8. One of t-ese 1enefits is t-e a1i#it) to 1u) new ite's and -ave t-e' auto'atica##) covered under t-e (o#ic) for ! da)s: wit-out -aving to s(ecif) or infor' Artguard t-at itAs 1een 1oug-t. Ot-er Artguard cover e#e'ents inc#ude #oss of va#ue and te'(orar) re'ova# cover. T-e (o#ic) features no e9cess on c#ai's. To cover W+:*** of art wou#d cost Dust W&2 for t-e )ear. 4u)ers can get instant 6uotes and (urc-ase cover on#ine c-oosing to (a) 1) credit card or direct de1it. Fine Arts Insurance 9 In ian Tren s:

B o r # d over invest'ents in 3ine Arts -ave grown over 1) ++O annua##) Prices in Indian Art -ave risen 1) 2* ti'es since 2**1 @ast )ear #eading @ondon auction -ouses re(orted W1*% 'i##ion of sa#es of Indian Art ProDection for t-e )ear 2*11 J dou1#e t-e figure 5<a-isasura8 1) T)e1 <e-ta was so#d for a record W$ +:*** in 2**2: )ears 1ac0 t-e sa'e wor0 was so#d at W+!:***.

4ust of <a-araDa ?u#ee( Sing- was so#d in t-e )ear 2**! for w-ic- t-e
&

ART INSURANCE

as0ing Price was W2+:***- +:***. 4ut #ater a (rivate Indian Co##ector 1oug-t it for W1.!'n.

SURVE/
Sur,e! Met$o olo(! H O'ser,ations: An e9-austive stud) was 'ade to identif) t-e Art @overs (ossessing insura1#e o1Dect for w-ic- sur,e! s$eets were (rovided. An interactive for'at in t-e for' of a 6uestionnaire was (re(ared for t-e
&&

ART INSURANCE

(ur(ose of conducting t-e surve) and recording t-e res(onses. Surve) was #i'ited to t-e 1oundaries of India and t-e co''on (u1#ic. A#'ost +* (eo(#e were -anded wit- t-e s-eets of 6uestionnaire for'at. ?uring t-e various interview sessions wit- t-e co''on (eo(#e it was o1servedE

+ out of 1* (eo(#e a'ongst t-e co''on (u1#ic dec#ined to 1e interviewed i.e. Res(onse rate +*O. T-e detai#s (rovided can 1e rated at & on a sca#e of 1-1*.

4UESTIONNAIRE 1. Cou#d )ou te## us a## t-e different t)(es of insurance )ou current#) -aveH o o o o @ife insurance <ortgage (rotection insurance Ter' Insurance Retire'ent (#ans
&+

ART INSURANCE

o o o o o o o o o o

Endow'ent Insurance <edica#Q;ea#t- insurance Critica# i##ness Persona# accident insurance B-o#e-#ife insurance AutoQCar insurance <one) 1ac0 insurance Trave# insurance Unit-#in0ed insurance A## of t-e'

2. B-at are t-e reasons w-) )ou do not own an) insurance .1esides t-ose 1oug-t 1) )our e'(#o)er/H o o o o o o o o o o o ItKs too e9(ensive Insurance is not i'(ortant: no reason to get it It is not necessar) or wort- doing It is too -ard to understandQconfusing I do not trust insurance co'(anies It is too 'uc- -ass#e to get It is not wort- of good va#ue E'(#o)er s(onsored cover is sufficient for 'e Insurance is not wort- investing I a' we##-covered 1) ') E'(#o)er do not 0now . P#ease te## us -ow we## do )ou t-in0 )ou are coveredH o ?efinite#) we##-covered

&%

ART INSURANCE

o Pro1a1#) we##-covered o <a) or 'a) not 1e we##-covered o Pro1a1#) not we##-covered o ?efinite#) not we##-covered

&. ;ow #ong do )ou t-in0 t-e cover a'ount wi## cover )our 1eneficiariesH o @ess t-an one )ear 11-1+ )ears o 1- )ears <ore t-an 1+ )ears o &-! )ears do not 0nowQcanKt reca## o $-1* )ears

+. P#ease te## us if )ou -ave an) (#ans to get insuranceH o ?efinite#) -ave (#ans to 1u) o Pro1a1#) -ave (#ans to 1u) o <a)Q<a) not -ave (#ans to 1u) o Pro1a1#) -ave no (#ans to 1u) o ?efinite#) -ave no (#ans to 1u) %. B-at are t-e reasons w-) )ou -ave no (#ans of 1u)ing insuranceH o It is too e9(ensive o Insurance is not i'(ortant: no reason to get it o It is not necessar) or wort- doing
&!

ART INSURANCE

o It is too -ard to understandQconfusing o I do not trust insurance co'(anies o It is too 'uc- -ass#e to get o It is not wort- of good va#ue o E'(#o)er s(onsored cover is sufficient for 'e o Insurance is not wort- investing o I a' we##-covered 1) ') E'(#o)er o do not 0now o A## of t-e' !. ;ave )ou ever co'e across an) ter' ca##ed 5art insurance8H o Ges o No o <a) 1e o ItKs too e9(ensive o $. ?o )ou t-in0 it is i'(ortant to (rotect t-e (rice#essH o Ges: a1so#ute#). o No o <a)1e. o Price#ess co'e wit- a tag of (rotection.

2. >iven an o((ortunit) wou#d )ou (refer to ta0e u( art insurance for t-e (rotection of )our va#ua1#esH o Ges.
&$

ART INSURANCE

o No. o <a)1e. o ?efinite#) wi## (#an to 1u) o It is too -ard to understandQconfusing o I do not trust insurance co'(anies 1*. ?o )ou t-in0 t-ere is a sco(e of art insurance in t-e future eraH o Ges. o No. o <a)1e. o T-ere is a great sco(e. o Awareness s-ou#d 1e created. 11.Is it re6uired for t-e insurance co'(anies to (ro'ote t-e art insurance t-roug- t-e 'eans of co''unication as co'(ared to t-e ot-er (o#ices w-ic- are 1eing advertisedH o Ges. o <a) 1e. o ?efinite#) t-e) 'ust. o It wi## -e#( (eo(#e ac0now#edge its i'(ortance. o A## of t-e a1ove. 12.?oes art insurance as (er )ou wi## add u( to t-e sca#e of (rogress for overa## econo'ic deve#o('entH o Ges. o No. o <a) 1e. o It wi## 1oost t-e econo'). o Art #overs wi## active#) antici(ate.
&2

ART INSURANCE

S URVEYANAL YS IS .
%Aware %Unaware %Keen to know more about Art Insurance %Not Intrested to aware themselves about art insurance %Future of art insurance.

O'ser,ations: 1**O of t-e res(ondents are aware of Art Insurance. &*O -ave ta0en Insurance and %*O are not insured .or not disc#osed/. None of t-e res(ondent -ave co'(re-ensive insurance (o#ic). %*O res(ondents (refer Insurance Co'(an) -aving 1etter c#ai' servicing record. Conclusion: T-us t-is s-ows t-at t-ere is a great sco(e for art insurance in India.

+*

ART INSURANCE

CASE STU?G ON

Intro uction: T-e Co'(an): I33CO-To0)o >enera# Insurance Co'(an) @i'ited .IT>I/ is a Doint venture 1etween I33CO .Indian 3ar'ers 3erti#i=er Coo(erative/ , its associates and t-e Ma(anese insurance giant T-e To0)o <arine , Nic-ido 3ire Insurance Co. @td. As a co''ercia# ga##er) owner or (rivate dea#er: )ou want to 'a0e sure t-at (ro(er coverage is in (#ace for )our consigned ite's or t-ose owned 1) )ou or t-e ga##er). It is a#so i'(ortant t-at t-e (ro(er a'ount of coverage is in (#ace for ite's t-at are in transit or w-en t-e) are on view wit- )our c#ient or at an art fair: fra'er: conservator or an) ot-er unna'ed #ocation. And in case of #oss: )ou want to 'a0e sure t-at t-e va#uation c#ause is a((ro(riate and t-at t-e c#ai' wi## 1e (aid fair#) and e9(editious#).

+1

ART INSURANCE

B-et-er )ou are a (rivate owner or co''ercia# ga##er): we can cover )our co##ection for a## ris0s of #oss or da'age at an) #ocation. Our e9(ertise is e9tensive and our re#ations-i(s wit- t-e art wor#d 'eans t-at if )ou -ave to 'a0e a c#ai': )ou can 1e sure )our case wi## 1e -and#ed in t-e 'ost sensitive wa) (ossi1#e. B-at is 3ine ArtH R rarit) R R R R R O1Dects su1Dect to va#ue a((reciation due to age: ?escri(tion: -istor) or Paintings Scu#(tures Anti6ues Co##ecti1#es 4ric-a-1rac

B-at is coveredH Be e9tend t-e 'ost co'(re-ensive (rotection avai#a1#e in t-e wor#d: covering against accidenta# #oss and da'age at )our (re'ises and a#so w-i#st t-e insured (ieces are in transit. B-at is not coveredH @oss or da'age caused 1) or resu#ting fro'E1. Natura# ageing: gradua# deterioration: in-erent defect: rust or o9idation: 'ot- or ver'in: war(ing or s-rin0age 2. Re(airing: refra'ing: restoring: retouc-ing or an) si'i#ar (rocess . Aridit): -u'idit): e9(osure to #ig-t or e9tre'es of te'(erature: un#ess suc- #oss or da'age is caused 1) stor': frost or fire &. T-eft or dis-onest) co''itted 1) or in co##usion wit- an) (rinci(a#: s-are-o#der .1eneficia# or ot-erwise/: (artner: director or ot-er officer or an) e'(#o)ee of t-e insured: or an) (erson to w-o' insured (ro(ert) is entrusted or #oaned. +. @oss or s-ortage discovered w-i#e ta0ing inventor).

+2

ART INSURANCE

%. @oss of or da'age to (ro(ert) un#ess it is entered in t-e insuredKs stoc0 records.

Ac$ie,e)ent in >st !ear of o*eration:

IT>I issued its first (o#ic) on 1%t- Manuar) 2**1. Since t-e nu'1er of satisfied custo'ers of t-e Co'(an) -as grown 1) #ea(s and 1ounds and IT>I -as garnered a significant 'ar0et s-are a'ongst t-e (rivate (#a)ers in t-e industr). It was one of t-e few Co'(anies t-at generated (rofits in t-e first )ear a of o(eration:

co''enda1#e tas0 given t-e #ong incu1ation (eriods in t-e insurance industr). T-is was ac-ieved 'ain#) due to t-e tec-nica# s0i## of t-e e'(#o)ees: tie-u(s wit- #eading Reinsurance Co'(anies across t-e wor#d and focus on (utting in (#ace wor#d-c#ass s)ste' and (rocesses.

Gro&t$ in t$e su'seIuent /ears:

ART INSURANCE

ITGI an Fine Arts Insurance 9Pro uct Profile: Insurance co'(anies are entering t-e #east-e9(#ored do'ain of fine arts insurance. Iffco To0)o >enera# Insurance .IT>I/ is one of t-e #eading insurance co'(anies in India w-ic- #oo0s after art insurance sector. "er) soon t-e) are co'ing u( wit- two new (roducts in t-e nic-e area: (articu#ar#) for vintage cars: and anot-er one for 'usica# instru'ents. Pre'iu's on t-ese (roducts 'a) not 1e unifor' and wou#d de(end on c#ients and va#uations of t-e assets. 3o##owing are t-e ot-er detai#s of t-e co'(an)E

Ca*acit!: - As (er @#o)dAs S)ndicates in t-e sector of 3ine Arts t-e co'(an) is so#vent. Tar(ets: 9 Private co##ectors: Art >a##eries and <useu's. Ris" Co,era(e Pro,i es all ris"s co,era(eE- A co'(re-ensive 5A@@ RISFS8 coverage for accidenta# #oss or da'age w-i#eE In (re'ises In transit At an e9-i1ition

+&

ART INSURANCE

Ris" Valuation: 9 Ris0s wit- #i'its u( to USN 2+ 'i##ion can 1e rated wit-in t-e ca(acit). Un er&ritin( Facilities: 9 Under writing is centra#i=ed at cor(orate office. IT>I -as a treat) arrange'ent wit- underwriter ;isco9 of t-e United Fingdo' for (roviding ris0 cover in different seg'ents. T-e underwriter -as c#ients wor#dwide: inc#uding t-e Nationa# >a##er) of @ondon and 'useu's in t-e United States.

Fa)ous In ian Art Galleries H Art 5or"

%irla Aca e)! of Art H Crafts Galler!

A'anin ranat$ Ta(ore

++

ART INSURANCE

See)a .o$li Paine#s &or" Ma$ua Art Galler!

=a)ini Ro!

Ganes$ P!ne

CONCLUSION: T-ere is no reason for not -aving art insurance. True: it is 6uite e9(ensive. Art Insurance (re'iu's t)(ica##) range around -&O of t-e face va#ue of t-e art. B-i#e it see's #i0e a s'a## a'ount: in 'ost cases: es(ecia##) w-en t-e art in 6uestion is wort- 'i##ions: t-e (re'iu' is not a s'a## a'ount. Gou need insurance for )our art 1ecause it is wort- a #ot of 'one). Gou need to 1e (rotected against #oss or da'age to an)t-ing (recious or of -ig- va#ue t-at )ou 'ig-t own. Often artwor0 is a'ong t-e 'ost e9(ensive t-ings t-at )ou own and it is a#so easi#) da'aged and art t-efts are not unco''on. Insurance against #oss or t-eft of )our art is t-e 'ost co''on t)(e of art insurance and it is a#wa)s a good idea to -ave a (o#ic) t-at covers t-is. It is 6uite dis-eartening to #ose )our favorite and 'ost va#ua1#e (iece of art. In 'ost cases: (re'iu' for t-is t)(e of insurance is 6uite -ig-. T-erefore: it is a good

+%

ART INSURANCE

idea to 1e at #east (artia##) covered. B-i#e it 'a) not co'(ensate t-e 'one) )ou s(ent in ac6uiring t-e artwor0: it can (er-a(s offset t-e cost of recover). Art insurance t-at covers da'age is e9tre'e#) usefu# to (rotect )ou in t-e unfortunate event t-at t-e artwor0 is da'aged. Usua##) da'age (o#icies cover a## causes suc- as trans(ortation: natura# disasters: fire etc. Re(airing art: es(ecia##) scu#(tures is an e9(ensive (rocess as one wou#d re6uire e9(erts to get it done. Bit- a## of it covered: t-e insurance co'(an) 1ears t-e ris0 w-i#e )ou (a) t-e (re'iu' and t-e) wi## -and#e t-e finances for )ou. In addition to #oss and da'age: )ou can a#so insure )our art for re(airs. B-i#e it see's t-e sa'e as co'(ensation for da'age: it is so#d se(arate#) 1ecause it on#) covers 'inor refur1is-ing suc- as (o#is-ing or fra'ing. It doesnKt inc#ude re(airs t-at arise due to an) da'age: for w-ic- t-ere is a#wa)s da'age insurance to go 1). Art insurance a#so (rotects )ou against dis(utes t-at arise fro' t-e owners-i( of t-e artwor0. In t-e un#i0e#) event t-at t-e artwor0 )ou (urc-ased was origina##) ac6uired t-roug- an) unfair 'eans and t-e origina# owner wis-es to sue )ou: )our insurance (rotects )ou fro' t-e #ega# fees and co'(ensation t-at is soug-t. To avoid an) suc- -ass#es: it is 1est to trace t-e origin of t-e artwor0 traced and (urc-ase artwor0 on#) fro' a re(uted dea#er. Overa## art insurance is a ver) usefu# and in 'ost cases necessar) entit) to go wit- )our art w-et-er )ou are a dea#er: (rivate owner or owner of a (rivate ga##er). T-e 1est )ou can do is to c-oose t-e (o#ic) t-at )ou fee# is rig-t for )ou. Art insurance is e9(ensive 1ut t-at is no reason not to -ave it. T-e i'(ortance of it under'ines t-e (rice and if )ou can afford a ver) e9(ensive (iece of art )ou can Dust as we## afford t-e insurance for it7X 5e'lio(ra*$!: 1. >oog#e 2. Ga-oo . <SN.co' &. Bi0i(edia.co' +. www.#ouvre.co' %. ICICI@o'1ard.co'Q>enera#Insurance

+!

ART INSURANCE

!. <a94u(a.inQAgent $. Du'(start.co.in

+$