Fine arts are always a difficult category toinsure.

It covers a broad range of items including paintings, statuary,textiles, art glass and other decorative items.

However, not all decorative items are fine arts; an insured maybe very attached to her collection of cat figurines, but unless thefigurines were made by a known artist they are not fine arts, evenif some were expensive.

What some people consider a fine art is actually a collectible,or just an expensive item used on special occasions, but notexactly artwork.

What is fine art?

The first step in insuring fine arts is determining that anobject is indeed a fine art. A fine art is a genuine work of artwith some historic or artistic significance that requires specificfine skill to create and is often rare or unique. A painting Icreate is certainly rare since I don't paint; likewise it haslittle to no artistic value or merit, even if it turns outreasonably well.

A popular activity now is to attend the Painting with a Twist orPaint and Wine classes where a group of people are walked throughcreating a painting of a particular scene while drinking wine orother alcoholic beverages.

While the attendees create respectable pictures, they are notfine art. Framed prints that are readily available, even if theinsured had them custom framed, are still just personal propertyand not fine arts.

Established artist

So what about the insured who is an artist and paints picturesfor his own collection or even sale? The insured sustained a fireand was looking for compensation for the damage to his artwork.Unless the insured has established himself in the art world beyondhis immediate community, his paintings are not fine art, regardlessof how well done they are.

A copy of a Rembrandt, while beautiful, is not worth the same asan original Rembrandt. Therefore, the insured would be compensatedfor an equal quality picture of the same subject.

Continue reading…

Is that collectible covered?

Collectibles are generally items that appeal to a broad audiencewhose members accumulate the items. Baseball cards, comic books and certainfigurines are all collectibles. Most are mass produced with alimited number still available, which is part of what makes themcollectible. Some may be on the market today.

Many people collect Swarovski glass figures, and there is acollectors club with annual pieces available to those in the club.They are expensive, but they are not fine arts.

Related: 5 unusual insured collectibles

Some carriers do allow collectibles to be scheduled as finearts; generally those policies will include bric-a-brac in theirlisting of art objects and may indicate statuary including but notlimited to Hummels; wording like this opens the policy to thescheduling of collectibles as fine arts.

But what about a bride's fine china and crystal stemware sheregistered for and received as wedding presents? Stemware and chinacan be expensive, especially when several place settings are ownedby an insured. Such items are personal property. While expensive,they are mass produced, readily available, and even though theinsured uses them only on special occasions, they are not finearts.

An insured had a beach themed restaurant and claimed a loss of$300,000 in stolen shark teeth. The teeth were both decoration andfor sale to customers. The policy in force described fine arts inpart as “….rare glass, bric-a-brac, and similar property of rarity,historic value or artistic merit.” Shark teeth can go for as littleas $7.99 for 50 teeth on eBay to $2,500 from a shark fossilwebsite. Again, since the policy includes bric-a-brac as fine arts,the shark teeth could be considered fine arts and should be coveredas such.

Determining real value

But once an item has been identified as a fine art or even acollectible that the insurer will allow the insured to scheduleonto the policy, valuation is the next step. In order to determinea value, most fine arts and even collectibles should have anappraisal from a professional appraiser who specializes inappraising works of that sort.

A jewelry appraiser's opinion on the value of the insured'sstatuary is probably not accurate. You need the proper appraiserfor the respective item.

Detailed appraisals needed

Appraisals need to be detailed; they need to list the materialsused in the art work, be it gems and metals or oils and canvas, erain which the work was created, quality of the pieces used in thework, and other information. For jewelry, the quality, color, caratweight, type of stone, and whether it has been heated, irradiated,filled or received other treatment are all importantinformation.

With furs it is important to know the type of fur, whether ithas been dyed, how much of the garment is fur, area of origin, andcondition of the garment are what's important. Guns, cameras,musical instruments, antique furniture, porcelains, coins andstamps all have their specifications as to what is valuableproperty and just how valuable it is.

Continue reading…

The American Society ofAppraisers and the NationalAssociation of Jewelry Appraisers can point insureds in theright direction to locate an honest and qualified appraiser. Thereare appraisers for most any type of property, the issue is infinding them.

Remember that condition also affects the value of the property.A faded painting, no matter how famous the painter, will not beworth the same as a painting that is in good shape. Restorationattempts can actually decrease the value of an object. Cleaningsolvents and modern materials may cause more harm than good.

Recent appraisals

Most carriers require the appraisals to be no more than a fewyears old. The value of items fluctuates over time, and an oldappraisal may either artificially inflate the value or understatethe value of the item.

Once the item has been determined to be a fine art and anappraisal is in hand, the item can then be scheduled onto thepolicy. The HO 04 61 Scheduled Personal Property Endorsement iscommonly used to insure these items. It provides open perilscoverage for the items and allows jewelry, furs, cameras, musicalinstruments, silverware, golfing equipment, fine arts, stamps and coinsto be scheduled with specific limits.

This open perils coverage is particularly important. The namedperils may be hazards to all property, but jewelry is more likelyto be lost or damaged than be damaged by fire, riots, weight ofice, snow or sleet, or other named perils.

Scheduled personal property endorsement

Theft is likely for jewelry, but the HO 00 03 has a $1,500 limitfor theft of jewelry, watches, furs, precious or semipreciousstones, or $2,500 for theft of firearms and related equipment. Whenthe scheduled personal property endorsement is added, the insuredis covered for loss by theft and many other perils.

An insured had taken an expensive necklace on a cruise; whilelooking out over the rail at the water, the necklace slipped offand fell into the ocean. The loss was covered because the item wasscheduled. Otherwise, the insured would have had no coverage forthe loss.

Fine arts is a broad category with many types of property. It'simportant that the property be appraised for the value so it can beinsured properly, and then an endorsement must be added. Somecarriers give discounts if the property is kept in a safety depositbox.

When in doubt, it is advisable to discuss the piece with theunderwriter so that the insured is properly protected fromloss.

Christine G. Barlow, CPCU ([email protected]) is managing editorwith FC&S (www.NationalUnderwriter.com), the premierresource for insurance coverage analysis. She has an extensivebackground in insurance underwriting.

Related:

Real or forgery? Telling the difference is a fineart

The 3 top risks to client artcollections

Is it real? How to ascertain theauthenticity of art