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Fine art claims in excess of $300m after Sandy

Fine art claims in excess of $300m after Sandy What you see on TV when it comes to insurance is risk may well be meerkats and annoying TV adverts but the reality is very different.  Yes, insurance includes cars, homes and holidays, but what you see on TV is actually only a very small percentage of the risk and insurance market.

Take fine art for example.   The price of fine art has risen dramatically in recent years.  According to Knight Frank's Wealth Report 2013, art has seen a 92% increase in value over the past five years.  When Picasso's Garçon à la pipe sold for $104.2m in 2004, it was the first to break the $100m barrier but many paintings have since achieved new records - in March 2013 Picasso's Le Rêve sold for $155m, making it the most expensive Picasso ever.

Filippo Guerrini-Maraldi, Head of Fine Art at Lloyd's insurance broker RK Harrison explained, "As more and more fine art fairs are held in emerging markets like China, this creates big opportunities for Lloyd's, which can provide the very large amounts of insurance capacity required by organisers, galleries and dealers'

Robert Korzinek, Fine Art Underwriter at Hiscox said, "The value of art in a blockbuster exhibition would have doubled since 2006, and could now easily exceed $1bn."

The market paid out some large claims last year including claims for flooding from Hurricane Sandy which caused damage to many galleries and dealers in downtown New York. 

The fine art market is likely to see some changes as a result of Sandy says Guerrini-Maraldi.  The storm took a big chunk out of the art market's premium income - fine art claims may cost in excess of $300m, around half the market's actual global premium, he says.

For more examples of risk - from satellites in outer space to kidnap and ransom - take a look at the Trivia page on the Discover Risk website.

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