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New research1 commissioned by specialist insurer Ecclesiastical has revealed that seven in 10 (67%) high net worth (HNW) collectors want more art and collections risk guidance from their insurer or insurance broker, presenting an opportunity for brokers.
The survey of 250 UK HNW individuals who invest in art and other collectibles found that the most common investments made during the past 12 months were jewellery (44%), watches (44%), and paintings (40%). Followed by whisky (39%) and wines (38%).
Those with higher incomes and 35-44 year olds collected more types of assets in the past 12 months, while those aged 45 and over collected fewer.
The research discovered that accidental damage (73%) and theft (72%) are the top concerns for wealthy collectors. Damage in transit (69%) was also found to be a key concern.
The majority of HNW collectors have experienced loss or damage during the past 12 months. More than half said at least one item from their collections has been impacted by the escape of water and burst pipes (52%) and damage in transit (52%). More than half reported suffering accidental damage (51%) and malicious damage and vandalism (51%).
Overall, the survey found two-thirds (66%) of the HNW collectors surveyed believe they need to do more to protect their art and collections.
One way wealthy individuals are choosing to protect their assets is by purchasing replicas of their original items to thwart thieves. Half (51%) of those surveyed have knowingly purchased replicas, of which four in five (83%) say they use replicas to protect their art and collections.
Paintings (38%) and handbags (35%) are the most common replicas HNW individuals have intentionally purchased.
“From an old master painting, to a modern sculpture, a bottle of whisky, or a wine collection, as a specialist art and private client insurer, we understand the importance of protecting art, collections, and valuable possessions. Our latest research has found that over half of high-net-worth collectors have had their treasured assets impacted by escape of water and damage in transit during the past year. Half also reported suffering accidental damage, malicious damage, and vandalism. Brokers play an important role in helping high net worth clients understand the risks their art and collections face and in ensuring they have the right cover in place should the worst happen.”
Ecclesiastical recently published a guide that provides scenarios and risk guidance to help high-net-worth clients minimise the risk of being targeted by criminals. Ecclesiastical is encouraging brokers to refer to www.ecclesiastical.com/target and speak to their high-net-worth clients about how best to protect themselves and their households.
Last year, Ecclesiastical launched an enhanced high net worth home insurance product which includes cyber damage, cybercrime, and online liability cover as standard, and optional additional covers including business cover and travel insurance. For more information, visit www.ecclesiastical.com/artandprivateclient
1 The research was commissioned by Ecclesiastical Insurance and conducted by BVA BDRC. Online interviews were carried out 9 - 27 July 2023 with 250 UK high net worth individuals with an income of at least £200,000 per annum or liquid assets of at least £1million about their art and other collections.