Insurance, Non Insurance/shared

Transcription

1 Insurance, Non Insurance/shared shared liability & State Indemnity Collection Mobility 2.0 Madrid, 31 May 1 June 2010 Hans Buurman Deputy Director Gemeentemuseum The Hague

2 Flabbergasted. Object 1. Object 2. Object 3. Object 4. Object 5. Curator 350,000 1,000,000 2,200, ,000 12,000,000 Auctioneer A. 50, , , ,000 25, Auctioneer B. 500, , ,000 1,000,000 15,000,000

3 Value of Objects the differences in valuation are a cause of concern the determination of value is subjective

4 Gemeentemuseum The Hague

5 Top Collection: : 400,000 visitors a year 425,000 insurance premium in 2009

6 Non Insurance A short term consensus result,, at non insurance in case of total loss or theft,, is unrealistic Necessary to concentrate on other methods of reducing insurance premiums, based on shared liability or own cleverness.

7 Possibilities to reduce costs of insurance premiums Stop insuring depreciation Stop insuring the risk against terrorism and war Stop evaluating the object as high as possible Put out to tender at top collection exhibitions If the borrower pays for insurance,, let it happens against normal, financial conditions, not against immense profit Are there more possibilities in saving insuring premiums??? Introduce a European-wide state indemnity scheme based on a standard cover

8 Content of Insurance Covers DAMAGE DEPRECIATION TOTAL LOSS THEFT TRANSPORT 35% Incl. TERRORISM 25% STAY 35% Incl. TERRORISM 25% TRANSPORT RETURN 35% Incl. TERRORISM 25%

9 Insuring depreciation object is unique; it is impossible to replace this object after restoration,, the object is in the best possible condition there is no reason to suppose that a restored object has a less artistic or cultural value the premium will decrease 35% Stop insuring depreciation

10 Insuring against Terrorism and War The premium of covering against terrorism and war adds up to 40% of the total premium. The chances of terrorism and war are minimal (war doesn t come overnight) As long as this part of the premium is sky-high high, don t insure this risk insuring against the risk of Terrorism and War is not necessary

11 Insurance Premium Value of the object Permillage per euro For example insurance cover Gemeentemuseum The Hague,, object valued at 20,000,000 originated from a European museum, exhibition stays 3 month: Transport : 2 x 0.15 o/oo oo x 20,000,000 = 6,000 Stay : 3 x o/oo oo x 20,000,000 = 4,500

12 The value of objects I would be preferable to evaluate objects as low as possible and not as high as possible.. Nude Green Leaves,, and Blust : Picasso 81,000,000 Reaction of a curator: our Picasso has more quality,, the market price is higher than it was last week, also the new value is going up with 20,000,000.

13 Invite more brokers to tender This produces substantial differences in premiums Example:Total value of the exhibition 500,000,000 Dutch indemnity Broker a. 145,000 Broker b. 125,000 Broker c. 160,000

14 The borrower pays always the bill, but this can be in a different way It concerns a painting The value is 20,000,000 From a European museum The exhibition lasts three months Borrower s broker: 10,500 (2 x 0.15 o/oo oo + 3 x /00) x 20,000,000 Lender s broker: 17,600 (2 x 0.2 o/oo oo + 3 x /00) x 20,000,000

15 Borrower vs. lender The leading principle for insurance would be: Best quality of the insurance cover vs. the best price for the borrower The lender is responsible for the content of the insurance cover The borrower is responsible for the contract with the broker; no profitable influences

16 Special Insurance cover for outgoing loans Gemeentemuseum s special cover for outgoing loans A special cover with our broker Same conditions for outgoing and incoming loans The borrower of our objects has to pay the very lowest price for this insurance (without profitable permillages) No discussion about the insurance cover

17 More possibilities to save insurance premiums What will be the reason to insure the whole value of an exhibition during transport; are all the object at the same time on the road?? Is it necessary to insure the whole value of the exhibition??

18 State Indemnity State indemnity helps to reduce insurance costs substantially Differences in coverages make it difficult for lenders to accept the state indemnity of all the different countries It would be helpful if: There would be only one state indemnity scheme in Europe The museums develope a fixed cover for this indemnity The State indemnity covers the whole value of the exhibition.

19 Conclusions Museums in Europe can reduce insurance costs They don t need direct help from others But: : museum management at both sides (lender and borrower) would have to do this with a collective policy; shared liability. Let us aim to reduce insurance costs!