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Fine Art Insurance Is Often Worth More for What It Prevents Than What It Pays Out

Private Client Select’s Matt Sweitzer explains how collectors can reduce the risks to artworks posed by wildfires, thieves, household accidents and inadequate collection management by putting smart mitigation measures in place before losses occur.

Many collectors and art professionals think of insurers as the people to call after an accident or disaster has occurred. But prevention is better than cure, as they say, and art insurance should not be all about the claim. For collectors and anyone else who owns or stores fine art,  insurance companies can offer valuable guidance on pre-disaster due diligence to mitigate or even eliminate risks to a collection. “That is probably the most common misconception about insurance,” Matt Sweitzer, head of fine art and collectibles at Private Client Select Insurance Services (PCS), told Observer, explaining that the company’s offerings go well beyond those of a conventional insurance company—something particularly important for high-net-worth collectors because artworks are unique and irreplaceable. “Our preference is always to prevent the loss. Some are not preventable, but many are, and we prefer that clients engage with us early because we want to use the knowledge we have gathered over the years to help them protect their art.”

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PCS maintains a vetted network of trusted storage providers, appraisers, conservators, collection managers and art advisors with which it can connect clients before an emergency happens. “It can be difficult to know who is best, who specializes in a particular type of art and who can properly handle a specific collection,” according to Sweitzer. “We have spoken with these professionals, vetted them, worked with them and built relationships with them. We have a robust vendor database that is available to our clients when they need advice.”

Effective prevention requires looking at both the collection and the property in which it is displayed. PCS insures homes as well as art, allowing its risk-management teams to assess the building, the collection and the relationship between the two. To assess the level of risk and advise on the most appropriate risk-management strategy, the art services team visits sites, interviews collectors and collection managers and reviews the procedures in place to safeguard works. During such visits, experts evaluate everything from environmental exposure and installation methods to household maintenance practices and staff training and awareness.

Another factor PCS considers is medium—something that is often overlooked, Sweitzer noted, but extremely relevant, especially in the ultra-contemporary market, where artists may use much more fragile materials. “It is important to understand how to behave around specific pieces because even a slight movement can cause damage.”

Following this risk assessment, the team provides a report with a list of recommendations that the client can implement. Sweitzer emphasized that the advice is specific to both the collection and the region. A collection in Aspen faces a very different set of risks from one in Florida. “Every unique characteristic of a collection and its location informs our recommendations for protecting it,” he said. The increasing frequency and severity of climate-related events have made this geographic analysis more urgent. Understanding climate risk is one of the biggest challenges facing art insurance companies today, he added. “It is clearly changing. Severe events are becoming more frequent, and this is not limited to one location. It is happening........

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