Buy art insurance wisely, urges underwriter.


More insurers may be entering the fine art and specie sector but insurance buyers would be wise to prioritise experience and knowledgeable underwriting over price when seeking cover for their artworks. That is the view of Paul Le Boutillier, senior underwriter, Fine Art & Specie for XL Group.

“New insurance companies look at a few years’ results and see this as a potentially profitable sector which they think they should get into as part of a more diversified portfolio,” he said.  But with artwork the serious losses can be a few years apart; and underwriters need to factor this into their plans.”

He said that there is a pressure on rating but disciplined underwriting should be a priority so  that the insurance industry can continue to offer insurance protection over the long term. “A lot of sophisticated purchasers of insurance realise that the cheapest option is not always the best.  They know they get value from a product where the wording is fit for purpose and the insurance firm has financial strength behind it.”

He said that when taking out art insurance it is important to understand the scope and limitations of your policy. Typically physical loss and damage will be covered, as will depreciation following damage. If you want your art to be able to travel – for example to exhibitions, it is wise to ensure that this is covered in your policy, or that the gallery that is borrowing your work has adequate cover.

Common exclusions include inherent vice, (in other words, if your artwork is made out of materials that naturally disintegrate you cannot claim on your policy when this happens); wear and tear; pests and vermin; war; and terrorism – although this can often be added if required.

He added that it is necessary to have the proper security in place in order to obtain coverage.

“We provide an affordable product that’s fit for purpose, our clients are people who understand risk and have taken the proven steps to protect their valuables – people who ultimately act as if they were uninsured.”