Seeking – Director for Museum, open 4-10 days a year with hundreds of curators involved and tens of thousands of visitors. Must be able to cope with logistical nightmares and able to please everybody all the time.
How many museums are there in the world? Have a guess. I have no idea so email me if you know. My point is there are thousands upon thousands of museums, more than it would be possible to count with any great ease. These museums are, for the most part, constant. They don’t open then close, then open then close. They are afforded the luxury of time to organize, correct, and improve. How do you go about cramming all this into a week?
That is the task art fairs aim to achieve. It has long been said, usually when journalists are in ear shot, that art fairs are temporary museums; the only difference is the art is for sale. But the elegant façade betrays a huge undertaking. Logistically this is a monumental machine to put together, one that would not be possible without the liberal application of insurance to grease the cogs. And this stretches far beyond insuring the art on the walls.
“The most important thing in both personal and business life is peace of mind - insurance is part of achieving that.”That’s from Paul Morris, president and co-founder of the Armory Show. He definitely recognizes the importance of insurance to art fairs. In order to achieve that “peace of mind” a fair needs to protect itself and its exhibitors from potential financial losses. According to Morris, Pier 94 is undergoing a significant renovation courtesy of the great MMPI (the fair’s parent company). Here are just three considerations for fair organizers:
1. Workers Compensation Insurance: Needed for the staff for maintenance and building of all the booths at a fair venue. Add to this any and all employees working for the fair organizers, the exhibitors, and fine art shippers. This represents hundreds of policies each party involved must have to employ personnel. Without this coverage, the booths would never be built the fair organizers and galleries would have no staff and the art would never ship. All of which makes holding an art fair kind of difficult. The insurance is there to protect both the employer and the employee; creating an environment for business to be conducted.
2. Commercial Liability Insurance: For the fair venue, its organizers, galleries themselves, and shippers in the event an accident occurs. Without this insurance it could be extremely financially damaging if something bad happened. And bad things do happen, and can be fatal. Though a public art space and not an art fair, in 2006 the British artist Maurice Agis erected his temporary on site immersive art work, Dreamspace, at a small town in North England. The work was a series of huge intersecting, colored bubbles easily large enough to walk through, as was the intent. While a number of people were inside, the wind outside picked up, broke the moorings, and lifted the balloon-like structure 30 meters into the air, crashing back down and unfortunately killing two women. Agis had no insurance, was taken to court on manslaughter charges (which the jury could not agree on a verdict for) and was fined 10,000GBP. This was later reduced to 2,500GBP to better reflect his minimal income of 125GBP per week, from a state pension. He died in October 2009 aged 77, with the debt still standing. If this had occurred in the US, at a major art fair, the damages sought would have been exponentially higher.
3. Event Insurance: What if the whole event is canceled, due to weather or some unforeseen circumstances? In 2008 the Summer Arts Fair in Omaha was completely flattened by very high winds, while not a major fair, it goes to show what could happen. The organizing company stands to be significantly out of pocket, as do a number of others. Event Insurance goes a long way in protecting the financials involved. Having to cancel a fair in the late stages is more than enough to sink a great company. And that can be hard when it’s a brand that took years to build.
It soon becomes apparent that if you want to do anything even close to a large art fair, there are huge considerations and responsibilities. All this before we even start to think about the juggling act of making exhibitors happy or protecting the art itself.
The art itself is by far and away the biggest financial exposure. Christiane Fischer, President and CEO of AXA Art Insurance in North America, says that at any major international art fair, “AXA Art insures anywhere between $100 million and $1 billion+ in art”. I find that pretty incredible. Combine that with the exhibitors not insured with AXA Art and you start to see a sweat-inducing number. The whole of TEFAF, which AXA Art has a great legacy of being the main corporate sponsor of, has approximately $4 billion in art on display.
In addition to this, there is another key component: shipping and handling. This is a massive undertaking. Transporting $4 billion in art is enough to cause a cardiac event. In order for the shippers to be able to conduct business they need significant insurance policies in place to protect themselves from potential losses and lawsuits. Even the most cautious shippers unfortunately suffer losses at some point. In fact, shipping is the most common cause of art insurance claims. This is such a huge topic and I don’t want to digress so I will be dedicating an entire article to it in the near future.
There you have it; everybody and every company involved needs the proper insurance in place for a market to trade. Often I get the impression some would rather do without all of this insurance. “It gets in the way of doing business. Why can’t we all just forge ahead with out it? It costs money. It delays progress. It’s, simply put, annoying.”
Those of you who have been reading these articles know that this notion is counter intuitive. As my last article explained, insurance allows us to conduct business while transferring the large majority of risk. Indeed it allows us to take on larger financial risks than we would otherwise be able to assume. Rather than getting in the way of business, insurance facilitates it. It provides a safe environment in which to conduct serious business.
What is serious business? $4 billion art fairs are serious business.
