Art in the time of Covid-19

19 August 2020

With so much uncertainty in the art market right now, your clients should consider having their artwork and collectibles valued. But how does one choose the right appraiser? Siobhan Mannion, Senior Underwriter, DUAL explains.

Along with almost every other aspect of the modern world, the art market was brought to a standstill this year as a result of Covid-19. As countries closed borders and businesses closed doors, art fairs, galleries, auction houses and studios around the world were forced to lock up and shut down. With events cancelled or postponed, staff furloughed or laid-off, and in-person viewings all but impossible, the art market ground to a halt. In the wake of this unprecedented interruption to normal service, the art market was forced to innovate. More and more galleries have been turning to the internet, offering online viewing rooms, Instagram live artist performances, and independent subscription services. Sales have evolved, too. At the end of June, just two months after being forced to postpone auctions and furlough 200 staff, Sotheby’s hosted a live-stream auction that had sales in excess of US$363 million.

Art’s evolution

While such developments make sense in an increasingly online world, it isn’t yet clear whether they will be enough to protect the art world from the impacts of coronavirus. The change of direction will likely slow the market considerably - as will the global recession resulting from the pandemic and lockdown. So, what does that mean for your clients? The volatility in the art market means that your clients cannot take for granted the value of their art. We would always recommend that clients have their art and jewellery valued annually to account for variability in the market – with such a dramatic change, it is important now more than ever that their insurance is adequate for their needs.

Your clients need a valuation

Some clients are resistant to paying for a valuation unless they are intending to sell their valuables. However, a professional valuation is vital to ensure that the artwork, sculpture, jewellery or antique is properly insured. In a market as fast-moving as the art world, a year or two can see double-digit value fluctuations. If an item was valued and insured two or more years ago, it could be under-insured today – and your client might not see its current value reflected in a claim should they need to make one. By investing in a professional valuation - when possible and when lockdown restrictions allow - your client can protect their artwork throughout the coming recession, and regain its current value in the case of damage or theft.

How to choose an appraiser

When paying for a valuation, choosing the right professional makes a huge difference. Most insurers only accept the work of a qualified, approved appraiser – if your clients don’t do their homework first, they could end up paying for a valuation that isn’t worth the paper it’s written on. The best way to ensure that your client’s insurer will accept the valuation is to ask for their

referral. At DUAL, we have a list of appraisers that we are happy to recommend. Your client can also ask for a recommendation from other art collectors, galleries, or curators, who should be able to suggest some reliable professionals in the field.

What to look for in an appraiser

A quality appraiser should have a working knowledge of the art market, and specific expertise in the type of art your client is having valued. For example, the expert they consult for their Rolex wouldn’t necessarily be the best choice for their antique furniture or prized artwork. The appraiser should be able to demonstrate their education and qualifications in the field, and/ or a history of appraising similar items.

What an appraisal should include

A comprehensive appraisal should include a detailed description of the item, including any distinguishing features, with measurements and photos to match. The report should detail the condition and provenance of the piece, the appraisal methods used, any limitations to the findings, and the reason for the appraisal. Finally, there should be a certificate of appraisal including the appraiser’s credentials and signature. These are the details the insurer needs to update your client’s policy and ensure they are fully protected.

The right insurance

The challenge doesn’t stop with the appraisal. It is also vital to make sure that your client’s precious possessions are properly covered by their insurance. DUAL’s Home and Contents policy offers all risks worldwide cover as standard for all jewellery, contents and fine art. If your clients have high value contents and jewellery, get in touch to find out how we can help protect them.

For more information contact Siobhan Mannion. Siobhan is a Senior Underwriter at DUAL, the world’s largest international MGA. DUAL Private Client specialises, amongst other areas, in high net worth personal insurance in Ireland and are backed by AXA XL, a division of AXA, one of the world’s largest insurance groups. t: 01 6640001 / e:enquiry@ dualgroup.ie

This article was first published in the August edition of Irish Broker Magazine - read the PDF version.