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What Happens When Your Van Gogh Is Gone?

So those who own a valued piece of art should always have it insured. Insurers such as Chubb and Travelers handle specialty policies like this.

Their first step is to have an independent appraiser check its value and make sure it was not already stolen by checking the art registry. This is particularly true for art that may have passed through Europe during World War II, when light-fingered Nazis were stealing anything not nailed down.

Then the insurance company will examine home security to make sure there are alarms and protective devices to keep it dry and secure.

The Kentucky Derby

But most art collectors aren't satisfied with just hanging their Jackson Pollock on the wall. They want it displayed publicly, even at the risk of losing it. Why?

"Collectors lend to galleries because they like to share," says Andrew Gristina, who heads the Travelers Fine Art Practice. "Some feel it's their duty."

But there are other reasons, such as bragging rights. Like the owner of a Kentucky Derby winning racehorse, it's an honor to have an exhibit with your name on it.

And it can be profitable, too. As Dorit Straus, worldwide specialty fine art manager for Chubb Corp., points out, "an exhibition can help someone 'arrive.'" If artists become famous, their work is worth a lot more after a big showing by their owners. A lucky owner could find himself with the next "Scream."

Kidnappers and keepers

Thieves make it their business to know what art is worth, and are more than willing to rip it off walls. Some of it winds up in China, but there's also a thriving market for stolen paintings in Eastern Europe.

Some thieves are kidnappers. After all, a piece of art tells no tales after it's ransomed. Insurers say they don't pay kidnappers directly, and countries like Great Britain have specific laws against paying a ransom for stolen art. But no one denies that it happens in convoluted ways, such as providing a reward for a middleman who intercedes to have it returned.

Then there are "keepers," people who wind up with an Andy Warhol in their basement next to "Dogs Playing Cards" or, worse yet, tucked, like the portrait of Dorian Gray, into the rafters of an attic, perhaps for a generation. "Thieves may sit on it, but then someone dies, the heirs don't know the painting's value, and it goes up for sale," says Gristina. The Art Loss Register becomes aware of it, and it is returned.

Putting a price on it

But you wouldn't want to wait until you're old and gray to get back your masterpiece. Insurers say that if you do lend out artwork, here's what you should do:

  • Review the museum's offer. Exhibitions are often planned years in advance. Is it a "traveling" exhibition that moves to multiple locations, thus creating additional opportunities for damage or theft as the art is boxed and unboxed?
  • Talk to your insurance agent or broker. "We can review our contract as well as your agreement with the museum and the museum's own policy for covered perils," says Chubb's Straus. Insurers themselves have "flying squads" that investigate these thefts.
  • The museum is generally responsible for your art once it leaves your door. But your insurer will likely insist on a loan agreement that covers every possibility.
  • Your insurer will also look at the "facilities report," which describes in detail what kinds of security the museum or gallery is offering.

"Museums are wonderful places," says Straus, "but they're not cookie cutter." Some skimp on security, she says, particularly overseas.

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