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When it comes time to make a claim, coverage for fine arts
usually has exacting requirements for identifying a work, appraising its value, and establishing ownership.
By Joseph S. Harrington, CPCU
If anyone could have avoided this mess, you’d think it would be Douglas Altschuler, an attorney described as a “passionate” collector of fine art.
Altschuler owned one of a famous series of silkscreens titled Andy Mouse by artist Keith Haring. The works featured cartoon images of Haring’s mentor, Andy Warhol, as Mickey Mouse. Altschuler’s copy was signed by both Haring and Warhol before it was reported as stolen; a theft claim was filed.
That Altschuler owned one of the works in the series was not disputed. That a policy was in place covering one of the Andy Mouse works was not disputed. That the work was lost or stolen was not subject to dispute (yet). But Altschuler learned he would receive no insurance recovery because he had, in essence, wrongly identified the work.
Altschuler v. Chubb National Insurance Co. presents a thicket of details regarding the ways by which works of art are identified and tracked. In sum, the version owned by Altschuler was not the one specifically identified when he increased the limit on the last policy covering the work. So, in May 2025, a U.S. appeals court in Arizona upheld a lower court ruling that had upheld a denial of coverage by the insurer.
Who would know?
The case just described might not elicit much sympathy for a regular, albeit amateur, collector of art. But suppose this were a “layman,” so to speak, who had bought a work of art for the first time? Suppose the insurer had accepted the appraised value sight unseen (as was the case), issued the policy, and collected the premium? Would confusion over the identification of the work void coverage?
The simple fact is that the outcome would likely have been the same.
When it comes time to make a claim, coverage for fine arts usually has exacting requirements for identifying a work, appraising its value, and establishing ownership. If an insured comes short on any of these, it stands to lose some or all of the compensation it expects.
Movable objects of fine art are generally covered as personal property under standard homeowners and commercial property policies. While the personal property limits may be enough to cover the value of certain works, standard property coverage is generally regarded as inadequate for fine arts of any appreciable value.
Following a major loss, the personal property limit will be spread over the value of all damaged property subject to that limit and subject to its loss settlement provision (typically for actual cash value). Moreover, standard personal property coverage typically does not extend to damage caused by flood or earth movement, or to damage that occurs in transit, three key causes of loss to fine art.
Therefore, it’s common for fine arts to be insured under separate inland marine “floater” policies with their own limits covering the repair or replacement of the insured work(s), usually on an agreed value basis.
Fine arts floaters typically include flood, earth movement, and transportation as covered perils, and may include other perils that can damage fine arts, such as sudden and excessive levels of humidity. Floaters will typically not cover loss arising from expected deterioration over time or failure to maintain conditions necessary to preserve a work (e.g., temperature and humidity controls).
Claim conditions
Even with expanded coverage under a fine arts floater, it can’t be emphasized enough that fine arts claims are not like other personal property claims, few of which have the same rigorous requirements for collecting on a loss.
At the time coverage is bound, or very soon after, the insured under a fine arts policy should have several key documents prepared: certificates establishing the authenticity and provenance of insured work(s), applicable bills of sale and receipts, additional proof of ownership, current appraisal reports, and photographs. In the event of a claim, these documents will have to be produced on a timely basis to secure recovery; you don’t want to be scrambling about after a loss.
Regarding valuation of the insured property, owners of fine arts are encouraged to get updated appraisals by licensed appraisers at least once every five years. Failing to do so could result in the limit falling well below the actual value of the work.
It’s also important to keep documentation safely stored away from the insured premises and backed up on a remote computer network. Otherwise, a fire or flood that destroys the artwork could destroy the documentation, as well.
Even if a work is insured under a fine arts floater with thorough documentation, there are other potential pitfalls to securing full recovery. For example, fine arts floaters typically cover damage that occurs in transit, but that must be verified and reviewed for any territorial limits on transit coverage or any restrictions on the type of shipper utilized.
There’s a lot to overlook when it comes to insuring fine arts. Your clients will appreciate your guidance and support. They will not appreciate having their coverage voided by procedural failings.
The author
Joseph S. Harrington, CPCU, is an independent business writer specializing in property and casualty insurance coverages and operations. For 21 years, Joe was the communications director for the American Association of Insurance Services (AAIS), a P&C advisory organization. Prior to that, Joe worked in journalism and as a reporter and editor in financial services.
