Art insurers face record loss from Superstorm Sandy
By Sarah Mortimer and Myles Neligan
LONDON (Reuters) - Fine art insurers face claims of up to half a billion dollars, their biggest ever payout, to compensate the owners of artwork destroyed when Superstorm Sandy flooded galleries in New York.
Work by 1960s graphic artist and illustrator Peter Max accounts for the bulk of the loss, landing insurers including Catlin with a claim of $300 million, an industry source said.
"This will be the largest single art loss to the market," said Filippo Guerrini-Maraldi, head of fine art at insurance broker RK Harrison.
Catlin declined to comment.
Axa, the world's biggest art insurer, expects to pay out $40 million, art claims director Colin Quinn said, and brokers and underwriters say the total loss could reach $500 million.
That would wipe out virtually a full year's revenues for the art insurance industry, forcing it to push up its prices.
"Some underwriters will lose appetite for writing fine art business after Sandy, the global capacity for fine art business will shrink, and as a result rates will go up," Guerrini-Maraldi said.
Galleries and art warehouses affected by Sandy could be forced to pay up to 25 percent more for insurance, and insurers could refuse to cover premises in low-lying areas of Manhattan against floods, one underwriter said, asking not to be named. Continued...