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Lisa M. Barnes is the founder of Rare Art Appraisals. Over the past 26 years, she has appraised both personal property and fine art for private and public collections and government institutions. Lisa has planned, developed, appraised, and curated art collections for numerous corporate and private collectors. |
Forged artwork is not a new concept.
It has been around for thousands of years. So, it is no surprise that the third most profitable theft in the world is dealing fraudulent work.
How do you, as a collector, keep you and your collection safe? The answer is easy: arm yourself with knowledge. Information is key when it comes to adequately insuring your art.
Remember, your art is an investment, and like any investment, you want to protect your assets. If your home burned down in a fire, you would expect a fair valuation from an insurance company. The same should be expected of your art.
There are some simple collector Do’s and Do Not’s when it comes to protecting your art.
DO insure your artwork to protect your fine art against loss or damage.
DO schedule appraisals every five years to keep up on current market value.
DO save receipts. It's critical to have records for what you paid and when.
DO document, document, document! The more documentation to back a piece, the better.
DO require a Certificate of Authenticity. Art fraud is widespread, and authenticity is a must.
DO know the provenance of your art. Know where your art came from and keep a record of ownership.
DO keep information in a safe place. Hard copies can be kept in safety deposit boxes and fireproof safes. Scan and upload the digital copies to a secure system like Artwork Archive.
DO NOT lapse on appraisals. It is important to have up to date information for insurance.
DO NOT take someone’s “word for it.” Although there are many trustworthy individuals in the industry, ask for more than just a handshake.
DO NOT assume you are protected. Ask questions of your insurance company regarding their coverage and process.
DO NOT be afraid of new technology! Online art collection management systems like Artwork Archive are useful resources.
DO NOT forget to contact the Art Loss Registry if you end up missing a piece. Make sure you cover all of your bases.
Insurance for your art is like insurance for your vehicle.
When an artwork of yours becomes damaged, you can file a claim. If the damage exceeds the value of the work, it can be considered a total loss. In the case of an unfortunate event like this, you want the insurance company to be equipped with as many tools as possible to evaluate your collection correctly.
An accurate valuation is vital for insuring the collection because art can appreciate and depreciate. As a policyholder, make sure that your appraiser keeps up with comparable art trends. It was estimated that $100,000,000 in fine art was destroyed in the September 11th attacks on the World Trade Center. Most of the art was underinsured due to inadequate insurance protection.
Avoid huge losses in your art's value.
When you do not have your collection appraisals properly scheduled, you run the risk of insurance companies disputing the value—which can result in huge losses.
Robert Levy of Beverly Hills Appraisals specializes in Fire Inspection for the Insurance Fraud Team of California. He states that “many undocumented collections fall in dispute bids.” Disputes can be avoided by following the proper steps to keep accurate and up-to-date appraisals.
When insuring your art collection, be sure that you understand your policy and the value in the event of a loss.
Fake art insurance schemes are on the rise.
Due to the rise in the number of collectors that insure their collections, there has also been a rise in insurance fraud. In 2013, a Minnesota man was sentenced for a false insurance claim set to defraud AXA Art Insurance Corporation for over $250,000 in stolen artwork.
The FBI website states, “Art and cultural property crime–which includes theft, fraud, looting, and trafficking across state and international lines–is a looming criminal enterprise with estimated losses in the billions of dollars annually.” The FBI now has a dedicated crime unit specializing in art fraud.
The art world will continue to see fraud, scams, and theft as it has since Greek and Roman times.
Be an expert on your art and stay on top of the necessary steps to secure your investment. As Sir Francis Bacon said, "ipsa scientia potestas est" translating to “knowledge is power.” Use your power to keep your fine art collection protected.
