Art Insurance


When owning expensive pieces of art, you run the risk of significant loss if disaster strikes. Consider purchasing art insurance to safeguard your assets.

When buying a piece of art, thinking about the possibility of theft or damage is not typically on the top of anyone’s mind. But while homeowners insurance policies cover certain personal items, a standard policy will not adequately cover costly works of art. Insuring your art not only gives you piece of mind, but could save you thousands of dollars if disaster strikes.

Newly Acquired Property Insurance

At purchase, artwork may automatically have some coverage under an existing policy. Many policies carry newly acquired property coverage. This insurance is temporary and incomplete; it is only meant to provide time for the purchase of additional coverage.

In most cases, newly acquired property coverage expires after 30 days and will only apply to types of property you already have insured. This means a newly acquired piece of art could receive coverage for 30 days provided you already have insured a collection. If you have no current insurance for valuable art, the new piece would likely be designated as basic personal property and carry minimal coverage. Be sure to check your existing policies before purchasing any valuable.

Getting Appropriate Coverage


To make sure you have an appropriate amount of coverage going forward, hire an trusted appraiser to determine the market value of your art. Then, consider whether you want to protect the full market value of the art or just a portion of its value.

The obvious benefit to insuring artwork’s full value is financial protection if it is destroyed; however, taking less coverage may make sense for some. Buying more coverage means spending more on premiums. For investors looking to resell art later, lower coverage increases risk of loss but could boost total profitability by lowering ownership costs. On the other end, art with significant sentimental value may be considered “irreplaceable,” no matter how much coverage it carries. In such cases, it may be better to spend money protecting the art than insuring it.

Investors should remember to update their coverage as the artwork gains value. In the event of loss, insurance will only compensate up to the insured amount, not necessarily the full current market value.

Premiums for the insurance will depend on a variety of factors, including the type of art, how it is being stored and geographic location. If you live in an area that is highly susceptible to hurricanes, floods or other disasters, then premiums are likely to be higher.

This article was written by Advicent Solutions, an entity unrelated to Busine LLC. The information contained in this article is not intended to be tax, investment, or legal advice, and it may not be relied on for the purpose of avoiding any tax penalties. Busine LLC does not provide tax or legal advice. You are encouraged to consult with your tax advisor or attorney regarding specific tax issues. © 2016 Advicent Solutions. All rights reserved.