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IN&OUT: Loaning Works of Art

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An increase in the number of exhibitions in recent years has meant that more art works are on display. This is great news for art aficionados, who get to see works that might otherwise have been kept behind closed doors. And for lenders, the increased visibility of their artwork can lead to a boost in its value.

This uptick in exhibitions, however, has been accompanied by an increase in the risk exposure posed to artworks, including by long journeys.

From the outset, risk management should be front of mind at every stage of the artwork’s journey from its usual home to the exhibition space.

When a collector or museum agrees to lend an artwork to an exhibition, the formal process begins when the organisers send a loan form to be completed.

As well as providing key information about the exhibition, this form should contain a precise description of the artwork, such as artist; title, measurements; frame; weights, use of glass and so on. It also should state the insured value of the piece and instructions for transportation, installation and handing, among other things. ,When lending artworks, exhibitions take out their  own insurance to cover the piece, so owners need to specify their preferred insurance company, if there is one.

Completing the loan form is only the first step, though. Lenders also must sign a very detailed loan agreement that covers, for example, fees; packing, shipping and handling procedures; maintenance and care instructions; insurance details; royalties for reproducing or exhibiting the work; restoration; and jurisdiction.

Lenders themselves should request details of the project in which their artwork is taking part, information about the organiser of the event, and a report on the facility that will house the exhibition.

It’s vital that lenders study these confidential documents closely, as they will give the lender a greater understanding of the level of quality of the exhibition, the professionalism of the organiser, and the security requirements of the exhibition venue.

If the exhibition is taking place in a country with high risk of catastrophic events – such as hurricanes, earthquakes or volcanic earthquakes – lenders should work with specialists to draw up emergency and disaster-recovery plans.


Risk management journey

Formal agreement of the loan kicks off a series of activities involving transporters, packers, fitters, restorers, registrars, insurance brokers and insurance companies. Each professional takes full responsibility for their specific areas of competence, with each activity representing a single link in a chain: if one should fail, then the whole quality process breaks down.
 
During this operational phase, there are several areas where sound risk management is vital to ensure the protection of the artwork.

First of these is transportation. Lenders should use a specialist transporter with proven experience in fine art shipping. The methods of transport and packaging must meet the requirements of the insurer, and the transport plan must include a comprehensive route description, detailing the intermediate stops and types of vehicle used.

Secondly, when artworks are being packed, lenders should ensure that the packaging used suits the specific nature of the piece – its format, the materials it is made from, its dimensions and weight and so on – as well as the method of transport.

Before a work is transported, lenders should ensure that any issues are evaluated by a trusted restorer. Any potential difficulty in removing the piece – such as awkward stairs, doors or windows – should also be discussed with the transportation company.

Ahead of transportation, lenders should ensure they have made a detailed condition report. The piece should be photographed from every angle, and this photographic evidence should be used to support the condition report. Lenders can either compile this report themselves or engage a restorer to do it for them.

If analysis reveals any damage, this must be included on the transport document – known as a DDT – in the section entitled “Notes or Reserve Annotation”.

The artwork should never be collected already packed but should be inspected by the carrier. The DDT must be countersigned by both lender and transporter. It’s also advisable to photograph the work once it’s inside the shipping box – a quick shot or two using a smartphone or tablet is perfectly adequate.


Exhibition set-up

The moment the artwork arrives at the exhibition venue, the condition report must be either updated or redrafted by the restorer present – a task that will need to be repeated following the exhibition’s conclusion.

If the loan is particularly valuable and/or significant, lenders should hire a trusted restorer to submit an independent analysis, to complement the one supplied by the organiser. Any disparity with the original report should then be communicated promptly to the lender, and no restoration work should be carried out without the consent of either the lender or insurer.

If damage has occurred, then an insurance claim must be opened. At this point, the condition report and remarks added in the DDT become evidence, which is why the documentation procedures accompanying the transfer of the artwork must never be overlooked. In a critical situation, insufficient documentation could quite easily compromise indemnity.

The display period commences when the artworks arrive at the exhibition site. It goes without saying that each piece is unique, so having an in-depth knowledge on-site of any peculiar properties is essential to ensure a well-executed installation.

Working closely with the registrar and the curator, the installer must heed the information about handling, previous restorations, particular fragility, assembly and disassembly, among other things, detailed on the loan form.

For more complex works of art, such as installations, it is crucial to have a written description of the procedures and methods for assembling and dismantling; in some cases, a digital installation video is extremely helpful.

Works should not be displayed while the exhibition space is still being constructed – for example while lighting is being rigged or the walls being whitewashed.


On display

There are several safety and security considerations that must be taken into account once an artwork goes on display.

Exhibition safety is a complex issue, taking into account aspects such as theft-prevention, fire and structural safety measures, and catastrophe risk-management and recovery plans.

It is therefore a good idea to use the facility report to enquire about safety measures and exhibition methods, such as microclimatic control, the type of display cases and lighting systems being used.

Lenders of particularly fragile items might request exhibitors to take extra precautions when displaying their work – for example using anti-tear hangers, bollards, special display cases or air-quality monitoring.

Lending a private artwork to a public exhibition is a laudable undertaking. But a balance must be struck between philanthropy and protection.

© 2018 AXA SA or its affiliates
AXA XL is the P&C and specialty risk division of AXA.