Management Consulting

Local authorities in the UK face significant challenges in accurately valuing their extensive art collections, which include over 1.9 million pieces ranging from historical paintings to contemporary street art. The unique nature of each artwork, influenced by factors such as rarity, desirability, and provenance, complicates the valuation process. Additionally, the fluctuating market values, driven by trends and public interest, can lead to outdated valuations if not regularly updated. This poses a risk for local authorities, as inadequate insurance coverage can result in financial losses and reputational damage if artworks are stolen or damaged. To address these issues, Aon provided a tailored solution that involved establishing a rolling valuation program for local authorities' art collections. This program focuses on valuing the most significant pieces and extrapolating their values across the entire collection, ensuring that the insurance coverage reflects current market trends. Aon also recommended regular reassessments of the top items in the collection, allowing local authorities to adjust their insurance coverage proactively. This approach not only enhances the accuracy of valuations but also builds confidence with insurance providers, facilitating quicker claims processing in the event of a loss. The implementation of a specialized fine art insurance policy further strengthened the protection of these collections. Unlike standard property insurance, fine art insurance covers specific risks associated with artworks, such as restoration costs and depreciation in value after damage. This comprehensive coverage ensures that local authorities are adequately protected against potential losses, including those arising from the theft or damage of artworks. By adopting these tailored solutions, local authorities can safeguard their valuable art collections, maintain their reputations, and ensure financial stability in the face of unforeseen events.