Skip to main content
Reinforcing Loss Prevention and Proactive Risk Management for Fine Art
Art Law Business & Real Estate Business Law copyright Intellectual Property
While insurance is an important safety net in the event of damage or other kinds of loss, nothing can resurrect an art piece that has suffered a total loss. This is why, in addition to obtaining or requiring proper insurance, artists, collectors, lenders, and dealers should consider contractual language to help lessen the risk of a loss from happening in the first place.
Recent Natural Disasters Highlight the Need for Proactive Measures
Over the past few months, unprecedented multiple wildfires have sprung up from California to New York and hurricanes are only increasing in frequency and intensity in Florida. These events underscore the importance of taking proactive measures to protect valuable art collections.
Contractual Measures to Mitigate Risk
While working with experienced and reputable service providers (i.e. storage facilities, shippers, etc.) in the industry is a good first step, making sure that your providers are being held contractually accountable may improve the odds that risk is averted. Consider including the following contractual measures:
- the provider or borrower must have and routinely update a written policy for (i) protecting fine art, and (ii) fire and flood emergency procedures that meet industry standards.
- ensure regular training for staff at least annually.
- require storage personnel to periodically document the condition of the artwork with
notes and photographs. - broadly require the provider or borrower to “exercise all due care in maintaining and securing” the artwork, plus any additional specifications that might be unique to that piece, including any measures that could lessen the damage that occurs over time (which is typically excluded from insurance coverage).
- name you as an additional insured on the appropriate insurance policy and provide a certificate of insurance.
The information contained in this post is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. If you would like to speak with a lawyer at GS2Law in confidence you can schedule a confidential consultation by requesting an appointment online today.