Here's how much it costs to package, ship, and insure a multi-million dollar piece of art
Andrew Burton/Getty ImagesWhen it comes to fine art, the ticket price is not the total price.
So you have some extra millions and you've decided to invest in a piece of fine art. Excellent choice.
But before you go raising your bidding paddle, you'll need an insurance program.
Take, for instance, Pablo Picasso's "Les femmes d'Alger (Version 'O')," which was recently auctioned for a record-breaking $179.4 million. Simply packing, shipping, and installing security for a painting of that value could cost up to $60,000, according to Kimeral Anthony, an account executive at ABD Insurance & Financial Services, Inc.
But wait, there's more: For a painting such as "Les femmes," Anthony tells us the annual premium could easily exceed $100,000.
Whether the art you're eyeing is $1 million or tens of millions, here's Anthony's advice on the insurance arrangements you need to make before you buy.
1. Meet with an insurance advisor as soon as possible.
Anthony strongly recommends looking into insurance options early. "You can't just add on a priceless painting [to your insurance] ... there are so many steps involved," he says. With a multi-million dollar piece of fine art, you need an insurance carrier willing to take on risk. Anthony suggests going to insurers that specialize in art and other valuables, such as AXA ART and XL Caitlin. The insurance advisor can also recommend appraisal and valuation services.
2. Obtain the necessary documentation for the art.
It's important to find out what documentation the insurance carrier requires. This can include any of the following: the artist's name, the significance of the artwork, the artwork's provenance (this includes previous ownership and exhibition history), and the value of the piece. The auction house from which the piece will be purchased should have all of these documents.
3. Find out what type of packaging the art will require.
There is much to consider when packaging a piece of art, including its size, its composition, and whether it requires a temperature controlled environment. "Art should always be professionally packaged by those who specialize in art shipping," says Anthony. For a painting like "Les femmes," Anthony explains that packaging would occur on site after a full evaluation. Security would be present throughout the process.
4. Arrange for 24/7 shipping and handling security.
High value works should be monitored throughout transit until they reach their final destination. When creating an insurance plan, it's essential to only hire professional art handlers in order to prevent damage.
Mary Turner/Getty ImagesSecurity begins as soon as the piece leaves the wall.
5. Prepare and install security at the site where the art will be displayed.
Congratulations, your newly acquired piece of art has been safely delivered. Now, the piece gets professionally installed and alarms are set up. The insurance underwriter will receive confirmation once the piece is safely delivered. Anthony says that some insurance carriers also require video surveillance both inside and outside as a portion of the agreed security program (remember: this piece of art is high risk!).