A cheaper way to insure your treasures

Most antiques owned by private collectors are insured under standard household contents policies. However, those with valuable collections, worth pounds 150,000 or more, may do better by insuring with a specialist, advi ses .

John Andrew

While several insurers now have specialist divisions that are responsible for art and antiques cover, there is only one company in the UK that specialises exclusively in this area. It is Nordstern Art Insurance Limited, whose ultimate parent is the insurance group AXA Equity and Law.

A customer taking out specialist insurance for art and antiques may find that premiums are lower than those of a non-specialist, and there is also the advantage of dealing with a company that understands the antiques market.

Clare Pardy, of Nordstern, explains: "Insuring arts and antiques under a specialist policy is often less expensive than insuring under general household contents." She adds: "In many cases collectors have good security, which, of course, reduces the risk of theft. Furthermore, today's petty criminals are more attracted to videos and money, as opposed to antiques."

This does not mean that antiques are of no interest to the criminal fraternity, but they tend to appeal to the professional burglar as opposed to the opportunist thief. Also, there is a reduced "moral hazard" where owners of antiques are concerned. This is the insurance industry's polite way of saying that collectors are less likely to make false claims.

Nordstern's staff all have an arts as well as an insurance background, and the company's risk manager is the former head of the Arts and Antiques Squad at Scotland Yard.

In their discussions, Nordstern agrees a price on individual items, taking existing valuations as a starting-point. This system of agreed values means that in the great majority of cases, any claim for losses is met immediately and in full.

Where damage has been caused, the firm will advise on whether to have the item restored, or to take the full cash value and buy a replacement. If the customer decides on restoration, Nordstern will pay for this and also pay the difference between the value of the item when perfect and its value after restoration.

Security is important where any valuables are concerned. However, as Clare Pardy explains: "We do not use a threshold approach, whereby a certain value triggers the need for an alarm. An alarm bell does not prevent theft; it is a deterrent."

What is important is good physical security, such as the use of locks and bolts. The level of protection also depends on the nature of the valuables; antiquarian books are less likely to be stolen than, say, silver. However, fire and water damage to books would be catastrophic. The lifestyle of the owners is also an important factor.

A home which is occupied for most of the day is less likely to be broken into than one in which the occupants are out at work, and a dog can be useful in keeping burglars at bay. On the other hand, people who casually leave windows open, or allow unknown workmen in the house unsupervised, are more likely to suffer loss than owners who are security-conscious.

Nordstern insists that collections are catalogued and professionally described. This can be a costly exercise, especially when the collection is extensive. To ask, "How much will it cost?", is rather like asking the length of a piece of string, but dealers and auction houses typically charge 1 per cent of the value of the items plus out-of-pocket expenses, such as travel and accommodation if an overnight stay is necessary. Others charge a daily rate - pounds 600 is typical.

Having the more valuable items in a collection professionally photographed adds to the cost, but, as the saying goes, a picture is worth 1,000 words, and a good photograph can be invaluable in helping to recover a stolen item.

In inner-city areas, insuring valuable objects under a normal household insurance policy could cost as much as pounds l per pounds l00 of cover.

Subject to Nordstern's minimum premium of pounds 500 per policy, the company would typically charge in the range of 20p to 35p per pounds 100 of cover. Recently the company has introduced its "ARTplus" policy, under which buildings and general contents may be insured in one package with a collection of antiques.

However, apart from the reduced cost, the real advantage of a specialist policy for the collector is the lack of hassle. A claim on a general insurance company can be complicated, and it does not cover the loss of value when an item is damaged; a specialist policy does.

Nordstern Art Insurance Limited (0171-626-5001)

savings with a specialist

Insuring a collection of, say, pounds 250,000, comprising pounds 75,000 pictures, pounds 125,000 antique furniture and pounds 50,000 porcelain. The prices are illustrative only, with risks assessed individually.

Typical

household

Nordstern Private

Collector Policy

Rural suburban pounds 1.125 pounds 500

Urban ordinary pounds 1,215 pounds 565

Household policy pounds 1,560 pounds 625