Do Artists Need Special Insurance?

As a regular columnist with The Rickie Report, an online news source for artists in Palm Beach County and beyond, I interviewed attorney Sheryl Wood. Sheryl has spoken to me in the past about legal issues for artist. In The Rickie Report article Sheryl discussed insurance issues for artists. Below is an excerpt from the article please click here to read the article in its entirety.

CH: Insuring artwork and the contents of my studio makes sense but the task is daunting. Can you help clarify the process?

SW: Looking into insurance coverage for a professional artist is a sound business move. The cost of business insurance is not prohibitive, however, replacing your studio and not being able to work are. You may have a homeowner’s policy if you work in the home, but be sure to read your policy, they typically only provide up to $2500 for business equipment or no coverage at all for business related assets. It is estimated that less than one third of artists have their works covered under business insurance.

There are three types of coverage you may want to consider:

• For Buildings, to cover the physical structure of your studio;
• For your Personal Property, to cover the contents of your studios such as tools, equipment, raw materials, works in progress, finished works, important papers and electronic records; and finally,
• Business Interruption, that covers loss of business income due to time studio is closed for an emergency.
If you can’t afford complete coverage, purchase what you can. Some is better than none. But carefully assess what you need and avoid unnecessary coverage. It is important to insure all works in the studio, including works in progress.

CH: How will the insurance company determine what rates the artist pays and what is covered?

SW: An insurer will determine insurance based on the artist’s stance in the marketplace. What do the paintings, sculptures, or works on paper sell for? If an artist is dealing with a well-established gallery, they should have coverage spelled out in the consignment agreement. However, even some of the established galleries may require artist coverage so they don’t end up covering those losses. Larger insurers typically cover mid-level to blue chip level artists. The reason is that it is easier to underwrite them. An insurance company looks at the way your art is consistently handled. For instance, do you transport your art in a vehicle vs. using a professional shipper and do you make individual miscellaneous sales vs. selling your work through galleries and auction houses.

To see answers to the following questions please visit The Rickie Report

• How would an artist find insurance for his or her artwork?
• Will an insurance company cover the all of the artist’s works, both finished and works in progress?
• Could you give me the names of some insurance companies that cover artworks about which you have knowledge?
• Are there other avenues that an artist might consider when shopping for insurance?
• How can you be reached if readers have further questions?