Insuring Installation Art

by Brian Shannon

What Can Be Insured

Felix Gonzalez-Torres

The field of installation art has more variations on materials and methods than one could reasonably list, making each and every approach to its insurance unique. Particularly with regard to time-based, conceptual, or site-specific installations, there is no standard. Walter De Maria’s “Lightning Field,” James Turrell’s light installations, Felix Gonzalez-Torres’ candy spills, Nam June Paik’s video works, Sol Lewitt’s wall drawings – each one may require a specifically worded policy to cover the various exposures particular to the work, and the expectations of the insured. Given these many variations, I want to address a few of the major issues that artists and collectors should consider when thinking about insurance for art installations.

Unexpected Losses

One fascinating aspect of installations is that they may defy traditional notions of medium, permanence and marketability. Plant matter, hot dogs, animal cadavers, and even soap bubbles are being incorporated into increasingly complex constructions that break down and decay as the work performs over time. The process of change may be integral to the experience of the work and the intention of the artist – but it may also render the work uninsurable. Only unexpected events can be insured against.

Jean Tinguely

Take the case of Jean Tinguely’s 1960 Homage to New York. This work was a large, complex outdoor installation constructed of motorized bicycle parts and found objects that when activated would slowly destroy itself. With a piece like this, damage is intended, and as such, cannot be insured against. However, for the same installation, events such as fire or vandalism can be. The type of coverage that would be available for such pieces would be determined by the nature of the work itself.

Definite & Measurable Losses

Strange as it may seem, not every artwork can be damaged, and if it cannot, then the question of whether or not to insure the work becomes more relevant. For instance, many forms of conceptually based art cannot suffer damage the way, say, a painting would suffer from having a hole poked through it. Actual physical damage may be limited or entirely irrelevant to the performance of the work, and insurance can only restore that portion which is affected.

Consider Felix Gonzalez-Torres’s “Untitled (Placebo),” 1991, for example. Consisting of 1,200 pounds of silver-wrapped hard candy arranged on the floor as if it were a giant area rug, the work can be created in almost any environment, moved, and re-fabricated endless times. The artwork only exists in physical form for the duration of its installation, and the work slowly disappears as visitors take a piece of candy with them until there is nothing left. This work cannot be destroyed so long as the artist’s instructions are available, and therefore a significant loss is highly improbable.

A partial loss, however minimal, may still be applicable. If the candy is completely destroyed from a fire, for instance, it would be appropriate to claim damages for the lost candy, but not for the entire work, as the concept remains intact.

Establishing Value

Damien Hirst

Installation art is rarely sold at auction, often leading insurance companies to base values on dealer, commission, or artist records. If an artist has gallery representation, the dealer often sets the value of the work. Galleries usually carry an insurance policy to cover the artwork while at the gallery. If the installation returns to the artist’s studio unsold after an exhibition, having a dealer’s pricing history available is a great asset for the artist to prove value under their own insurance policy.

For commissioned works, whatever the contract states, the value attaches to the work when “finished.” Prior to being finished, the standard is to provide materials and fabrication cost reimbursements up to the point that the damage occurred, allowing the commission to be completed. If, for example, casting a series of aluminum objects and etching panes of glass for a large room installation goes awry, the insurance customarily pays the artist for whatever materials and re-hired labor are needed to get back on track. If that involves a ton of aluminum, 20 sheets of glass, and a small army of engravers and mold makers, so be it. Keep in mind that insurance will not pay more than the policy is worth.

The vast majority of artists do not start their careers with dealers or commissions. Most of the artists I know pay out of pocket to create an installation for a group show that they themselves market and staff. Sales are not expected, so value is often not fully considered, and insurance is an expensive luxury. It can also be rather difficult to prove value when regular sales of like artworks are not available for reference. In these cases, a policy would likely agree to an overall limit of insurance that represents a compromise between cost of fabrication and materials, and comparable works in the artist’s market. For claims, the settlement terms may be written for replacement cost rather than market value, since the market value is so difficult to establish. Without a dealer price or commission contract, documentation of your costs, such as materials receipts and fabrication invoices, is the proof of value.

A Note on Claims

Jenny Holzer

There are many types of insurance policies and even more companies offering them – but not all are suitable for art. To have artworks covered under anything other than fine art-specific coverage begs your insurance company to settle a claim for a Damien Hirst or Jeff Koons just as it would a sofa or dishwasher. That often means the insurance contract allows for depreciation of the item based on years of use or, even worse, only offers to restore a Jenny Holzer LED piece with parts from a local hardware store and computer shop, rather than through the artist’s established fabricator. Artists creating installations and video-based art should have statements regarding their intentions for restoration on file with their dealer, the borrowing institution, and their insurance company.

A Fine Art Insurance policy protects the value and integrity of art because it recognizes how different artworks are from other objects. Clients are happiest when their art can be restored and returned in a state in which it can continue to provide enjoyment. That is what you should demand for your art, and expect from your insurance company.

Brian Shannon is a Fine Art Expert with AXA Art Insurance Corporation in Chicago. AXA Art is the world’s only fine art insurance specialist and insures objects in every active area of serious collecting. For more information contact: bshannon@axa-art-usa.com.