Art insurance protects an artwork in case of theft, fire, flooding or accidental damage. In Art Part Club’s Edutéka we explained that art is insured in two ways: as part of household insurance, or separately for more valuable works. Specialist art policies are often arranged on an all-risks basis, which means they cover everything the contract does not expressly exclude. That is exactly why the exclusions are worth reading too.
The basis of a specialist policy is the agreed value, the sum you settle with the insurer in advance and receive in the event of a total loss without any haggling. To set it you will need proof of purchase, or a valuation, and a photograph of the work. When a work is lent to an exhibition, cover is arranged “nail to nail”, from the moment it comes off the wall until it is hung back up. And what does it cost? According to the trade publication Atlas Magazine, the annual premium for paintings in a collection runs at roughly 0.1 to 0.5 per cent of the agreed value, so for a work worth 200,000 crowns a few hundred crowns a year.
The biggest trap is underinsurance. If the sum insured is lower than the property’s actual value, the Czech Civil Code allows the insurer to reduce the payout proportionally. Household insurance also tends to have a separate limit for valuables and art objects, which is often only a fraction of the total sum insured. And a work’s value changes over time. If an artist you bought at the start of their career grows, the policy stays at the original sum until you update it.
Art insurance makes sense for anyone who has a work at home they would hate to lose. Start by finding the limit for art objects in your household policy and comparing it with the value of your collection. Set up a folder for your works with invoices, certificates and photographs, and keep a copy outside the home too, because a fire would take the papers along with the paintings. Do you know what the paintings on your walls are insured for today? And if you co-own a work through Art Part Club, the club takes care of the insurance.
— Anna Pulkertová, founder of Art Part Club
Related terms: Art storage · Lending a work to an exhibition · Provenance · Fractional ownership · Framing and mounting
