New research commissioned by specialist insurer Ecclesiastical has found that 75% of high net worth (HNW) clients believe they need to do more to protect their art and collections. This marks a 9% increase from the previous year.
The survey, which included 250 HNW individuals who invest in art and collections, highlighted theft, accidental damage, fire, and damage in transit as the most significant risks. More than half of the respondents (55%) reported their collections had suffered accidental damage in the past 12 months.
Additionally, almost half of the participants said their collections had been affected by theft (48%) and damage in transit (46%). A third of respondents noted that malicious damage and vandalism (33%), fire (33%), and water damage from burst pipes (32%) had impacted their collections during the same period.
The study also revealed that replicas are being used by many collectors as a form of protection. Three in five respondents (57%) reported purchasing replicas in the past year, with a third (35%) doing so knowingly.
Nearly three-quarters (74%) of those who purchased replicas said they used them to safeguard their collections. The high cost of purchasing originals and the use of replicas as decoys were among the main reasons cited for these purchases.
Unknowingly purchasing counterfeit items was also a significant issue, with 48% of collectors reporting they had bought fakes over the past year. Many found out about the counterfeit nature of their items through experts, noticing the poor quality of the pieces, or by reviewing the details themselves.
Research from luxury pre-owned watch retailer Watchfinder & Co suggests that over one million counterfeit watches are in circulation in the UK. The study estimates that 14% of British collectors have counterfeit timepieces in their collections.
Dr James Lindow (pictured above), underwriting director for art and private clients at Ecclesiastical, commented on the findings, stating that protecting art, collections, and valuable possessions is crucial.
“Our latest research has found over half of high-net-worth collectors have had their treasured assets impacted by accidental damage, while half have been impacted by theft and damage in transit,” Lindow said.
He also highlighted the role of brokers in helping HNW clients understand the risks to their collections and ensuring appropriate coverage is in place to mitigate potential losses.
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