When fine art and insurance collide

For most artists, their work is deeply personal. Even after they sell a piece to a collector, in a sense the work still belongs to the artist; certainly, it represents an expression of the way the artist perceives the world, and will always be associated with him or her.

The Visual Artists Rights Act of 1990 (VARA) recognizes the unique relationship between art and artist. Under the federal statute, after selling a sculpture, painting or other piece of visual art, the artist still retains the right to “prevent any intentional distortion, mutilation, or other modification” that would affect the artist’s “honor or reputation.” Artists retain this right for life.

Owners of particularly valuable works of art are likely to take out an insurance policy on their collection. So what happens when an artist successfully pursues a VARA claim against the owner of one of his or her works?

Such cases often involved a restoration or repair of a work without the artist’s input. If the restoration goes against the artist’s wishes, he or she could decide to sue the owner under VARA. As Lexology notes, a successful claim could lead the insurance company to reevaluate the art as worthless. In turn, this could open the door to claims that the insurance company acted in bad faith, in order to avoid paying future claims against the piece of art.

Whenever we purchase an insurance policy, we rely on the insurer to treat us fairly if we ever need to make a claim. But that does not always happen. Insurance companies sometimes make bad-faith denials in order to save money. To fight back, you need a skilled attorney representing you.