Secrets to restoring the irreplaceable
High profile disasters like the fire at Notre Dame raise the questions: How are the works valued and how will they be restored?
The global art community has grown over the past decade with high-end art sales worldwide increasing by 9% in value, according to UBS Global Wealth Management. At the same time, specialist fine art policies are evolving for galleries and collectors as well as fine art brokers, which means loss adjusters are facing new challenges.
Assessing fine art and other often-irreplaceable items that have complicated valuations is a complex part of the insurance claims business. Unlike general adjusters, fine art claims professionals deal with objects that have more than monetary value — items that have sentimental value to the owners or deep historical significance, which makes the process more complex.
High-profile disasters such as last April’s fire at the Notre Dame Cathedral or the June 2016 flooding of the Louvre in Paris catch the public’s attention and raise the questions: What happens when an artwork is damaged, and how are the works restored?
When assessing an insurance claim, the first thing a claims professional will do is look at the value of the various items in question. However, when some of those items are priceless, how do you determine the loss in monetary value?
Media exposure surrounding high profile claims can exert a great deal of pressure on a multitude of stakeholders dealing with the claim and restoration work. Scrutiny from the media and the public has the ability to magnify any final decision made, so the insurer needs to be confident in its approach when making assessments and judgments concerning these losses.
Distortion of information is inevitable and could become an issue. Most of the time, insurers limit the amount of information shared with outside specialists and therefore, one has to be as objective as possible with the press and the information provided. When dealing with a loss of the magnitude of the Notre Dame Cathedral, for example, we know that it is extremely important to have a crisis communications plan in place and a crisis management team ready to handle media inquiries and manage the information to be shared with the public.
Our jobs require absolute confidentiality, particularly when we have to entrust work to external specialists or restorers who may have limited mechanical or physical protection for the items in question while in their care and control. At Sedgwick, we have a system set up whereby only selected individuals can have access to the sensitive information and file with the claim details.
Another challenge involves setting up a multitude of different skills beyond the actual handling of the loss itself and providing comprehensive service to the insurer and insured alike. In the case of Notre Dame, a team of specialists was already set up even before receiving instructions. Depending on the type of materials involved in the claim — whether it is silverware, artifacts, fabrics and the like, associated specialist restorers are needed to deliver the quick response and seamless service the client expects.
We believe that dealing with sensitive cases has helped put us ahead of the competition in this market. Others may have the skills and expertise but we are confident in our experience and the range of services we are able to provide across the world.
Restoration and recovery
While some claims scenarios involve clients who would prefer to accept financial compensation for a damaged item, that is not the case with fine arts. Restoration and recovery, which require extreme care and patience, take top priority, and claims professionals need to offer a range of options to refurbish the assets and revive the items.
The overriding priority in the event of a loss is to make sure the correct restorer is assigned to the claim as soon as possible. Restoration is always the best course of action but it can be difficult without the right experts who understand how to restore without causing further damage. There are risks when giving a job to a specialist restorer — the job could go smoothly or turn into a disaster.
It is extremely important for the restorer to have professional indemnity insurance. Most of the time, the items that go to the restorer are of unknown origin and the restorer may not be given the actual value. Recently, when we were asked to assess the damage of a Caravaggio painting, the restorer carried out initial restoration work without realizing it was worth $170 million.
Rarely does a restorer have to raise its personal indemnity (PI) coverage, limited liability or business interruption (BI) coverage based on work previously performed. However, on those rare occasions when the scope of a project exceeds the normal limits of coverage, specialists can help the PI insurer modify coverage in a particular area by providing an approximate value of the work.
Generally, this does not happen and knowledgeable restorers perform the work under their existing policy terms without having to raise the coverage limit. If a value needs to be assigned to a particular item, however, this can usually be done without modifying or significantly changing the policy limit.
Since the value of some restoration projects can be undetermined (an item may be priceless or worthless), this type of work should be carefully assigned. There is no ideal general restoration work in priceless artifacts and it has to be specialized or not attempted at all.
Genuine passion
The restoration of fine art is a complex process, which requires working with experts in different fields. Claims professionals who are dealing with fine art need to have a genuine passion for the subject. It is a rigorous process requiring patience and diligence to understand and investigate an art piece.
From a recent loss involving sketches and engravings by Henri Matisse, I spent 10 days in a bank strong room looking at similar articles simply to study and analyze the subject matter of the loss. What emerged from those 10 days was a much broader understanding and knowledge of Matisse including his life and work. It is the enriching part of the process that is normally not available to general loss adjusters, especially the time to expand personal knowledge and familiarity with a particular subject.
Working on a priceless object with sentimental value also requires claims professionals to remain sensitive to the historical, spiritual or sentimental aspects when assessing value and communicating final recommendations. Claims professionals need to have the ability to convey technical knowledge effectively and sensitively using simple language. While the process is ultimately about the claim, making sure clients feel comfortable can go a long way.
Michel Honoré is directeur, National Vol Fine Art for Sedgwick France. He is involved in restoring many of the priceless artifacts affected by the fire in the Notre Dame Cathedral.
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