1. Insuring the Irreplaceable Against the Unthinkable or Why Would You Want One More Insurance Policy Rollie Boeding State of Wisconsin Laura Condon Willis of Maryland

2. Session Plan  Brief Overview of State of Wisconsin Property Insurance Before July 2005  Overview of Fine Arts and Special Collectibles Insurance Coverage  Brief Overview of State of Wisconsin Property Insurance After July 2005

3. Wisconsin Property Program Before July 2005  $16 Billion in Values Included University of Wisconsin System Included University of Wisconsin System  $300 Million in Limits Per Occurrence  $2.5 Million Per Occurrence SIR  $2.7 Million Annual Aggregate SIR  Estimated $1.2 Billion in Fine Arts and Special Collectibles Values  $1,652,000 Premium

4. Wisconsin Property Program Before July 2005  Fine Arts and Special Collectibles Covered under Self-funded Program  Transit Covered Under Marine Cargo Policy with $100,000 deductible  Average Premium for Transit was $17,000  Major Concern Over Adjusting a Major Fine Arts Loss

5. What Does a Fine Art Policy cover?  It covers the items on your property program that “cannot be replaced with other items of like kind and quality”  More specifically:  The expected:  “fine arts and collectible objects of every description including but not limited to paintings, etchings, drawings, photographs, ceramics, sculpture, pottery, porcelain, rugs, tapestries, statuary,”

6. What Does a Fine Art Policy cover? And the perhaps unexpected:  rare books, coins, manuscripts,  other bona fide works of art,  rarity (natural history specimens and artifacts),  historic value,  or artistic merit,  and all associated property including but not limited to frames, glasses, shadow boxes, crates and other display equipment,

7. What Does a Fine Art Policy cover?  Property of the Insured; Property of others offered as gifts to the Insured or for sale to the Insured and while awaiting formal acceptance; Property of others offered as gifts to the Insured or for sale to the Insured and while awaiting formal acceptance; The Insured’s interest in residuary gifts and jointly owned property, but only to the extent of the Insured’s interest at the time of loss or damage; The Insured’s interest in residuary gifts and jointly owned property, but only to the extent of the Insured’s interest at the time of loss or damage; Property of others loaned to the Insured which the Insured has been instructed to insure.” Property of others loaned to the Insured which the Insured has been instructed to insure.”

8. Fine Art Coverage  Additionally Fine art policies cover such items:  On your premises  At other unnamed locations  While in transit  Worldwide

9. Valuation  Current Market Value of the item or the amount agreed to with the owner of the item.  Versus: Replacement Cost or Actual Cash Value or Scheduled Value

10. Common Misconceptions  In order to obtain a fine art policy you will need to:  1- create an itemized valued inventory that will have to be constantly up-dated and endorsed on the policy – wrong – coverage is blanket  2- have everything appraised first – wrong – valuation is current market value at time and place of loss  3 – We don’t have a state owned museum so we don’t have any fine art – wrong every state has some amount of fine art

11. Where are the fine art exposures?  State controlled universities and colleges  Special Collections section of state and university libraries – huge value in rare books and manuscripts  State archives  Museums  Historical Societies  State Capital building  Offices and court houses  Governor’s Mansion  State owned research facilities

12. Other Benefits  Fine art rates are generally lower than property rates  Increased capacity at highly valued locations  Decreased TIV reported to the property markets  Ultimately the cost of the fine art policy might be offset with saving on the property policy

13. More Benefits  No need to individually report transit exposures on a open cargo policy  Benefit of specialist adjustors, restorers and appraisers in the event of a loss  Very low deductibles – removing these exposures from self funded retentions under the property program

14. Where to start  Review Property SOV  Identify known and potential locations  Discuss estimated TIV with Key Locations  Ascertain estimated TIV at secondary locations  Top ten items at key locations  Cope contained on SOV  Facility reports and existing property inspection reports  Websites

15. Wisconsin Property Program After July 2005  $17.2 Billion in Values  $300 Million in Limits Per Occurrence for Regular Property  $2.5 Million Per Occurrence SIR for Regular Property  $2.7 Million Annual Aggregate SIR for Regular Property  Estimated $1.2 Billion in Fine Arts and Special Collectibles

16. Wisconsin Property Program After July 2005  Added Fine Arts Coverage $300 Million Limits on Five Largest Locations $300 Million Limits on Five Largest Locations $80 Million Limits at Locations Owned, Occupied or Controlled by State $80 Million Limits at Locations Owned, Occupied or Controlled by State $50 Million Limits for Transit $50 Million Limits for Transit $10 Million Limits Unnamed Locations $10 Million Limits Unnamed Locations $50,000 Deductible $50,000 Deductible No Deductible for Transit or Away from Normal Depository No Deductible for Transit or Away from Normal Depository $180,700 Premium $180,700 Premium

17. Wisconsin Property Program After July 2005  $600 Million Limits for Five Largest Exposures  $380,000 Million Limits All Other Locations  $1,470,000 Total Premium Including Fine Arts Coverage COMPARED TO  $1,652,000 Premium Before

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