John Levitt, Esq., a licensed estate attorney and financial consultant with Professional Planning Services, LLC of AXA Advisors in Long Island, maintains that artwork must be protected by insurance. It can sometimes be challenging to convince clients of this. Levitt had one couple "a few years back" who were afraid to insure their collection lest the IRS find out about it. Although it was a "bitter pill" to them, he did convince them that the IRS could surely audit the estate whether they had their collection insured or not; in the end they not only insured their collection but also dealt with "larger issues such as estate planning."
Christiane Fischer, CEO of AXA Art Insurance Corporation, says, "Many people do not want their art to be insured because they don't want to have anyone know it's there in the first place." However, she adds, advisors can find many discreet ways to help clients get their artwork properly insured. Such a financial asset, she says, should be an overall part of portfolio asset management for a client, "but for advisors, art is not on their radar screens."
