Fine Art Title Insurance

Kate Taylor of the NY Sun reported on art title insurance in July. I know I missed posting about the article and concept of fine art title insurance earlier. Recently there was a post on the ISA forum about the new insurance product. I believe it is still very viable and since it is a relatively new concept, something fine art appraisers should be aware of.

Taylor of the NY Sun reports "A new insurance product, art title insurance, is meant to protect both buyers and sellers against these kinds of problems. At the moment, only one company, called ARIS, offers it. Founded by a lawyer and a former AON executive, ARIS has underwritten more than 300 policies since it started selling insurance in June 2006, covering works of fine art valued at between $20,000 and $4 million. (They do not offer insurance on antiquities.)"

Taylor continues "The primary difference between this and real estate title insurance is that there is no central registry of art transactions. So while a real estate title insurer only has to search the public records to underwrite a policy, ARIS has to comb the spotty (and sometimes intentionally obfuscatory) records and recollections of dealers, auction houses, and collectors. That partly explains why art title insurance is so much more expensive than real estate title insurance. With both types of insurance, a purchaser pays a onetime premium for a policy that lasts for the life of ownership. The chief executive of ARIS, Lawrence Shindell, said that so far, premiums have ranged from 1.75% to 6.75% of an artwork's value, depending on the risk."

In today's litigious society, and with much fraud and various ownership claims, fine art title insurance is the type of service the fine art appraiser should be aware of and in the right circumstances recommend to clients.

To read the NY Sun article, click HERE, or to visit the website of ARIS, click HERE. The ARIS site has some very useful information and is worth visiting.