Insuring Art for Everyone: The Arts and Artifacts Indemnity Program
For Alice Whelihan, NEA's indemnity administrator, worrying about how art gets from point A to point B is a full-time job. Since 1980, Whelihan has quietly overseen the federal government's Arts and Artifacts Indemnity Program. Although she prefers to keep a low profile,Whelihan has been called "the fairy godmother for the nation's art museums." Panks to her meticulous efforts, American museums have been able to insure hundreds of international exhibitions that traveled to the United States.
Whelihan's job is about to get more complicated. In 2007, Congress amended the Arts and Artifacts Indemnity Act to add a domestic component to the program, allowing for the first time artwork from U.S. institutions that are exhibited in-country to be eligible for indemnity coverage.
"I am so excited about this," said John Buchanan, director of museums at the Fine Arts Museums of San Francisco. "It is one of the greatest things that the government can do for American art museums." Jennifer Russell, senior deputy director of exhibitions at New York's Museum of Modern Art agrees: "If you believe that the government should support culture, this is a pretty cost-effective way to support the museum world."
The U.S. government first got into the insurance business as a gesture of Cold War goodwill. The year was 1974, and the Metropolitan Museum of Art was attempting to host an exhibit of Scythian gold from the State Hermitage Museum in St. Petersburg and the State Museum of the Kiev-Pechersk Lavra. Congress approved special legislation insuring the treasures' trip to the States, and the Soviet government reciprocated by indemnifying the American and European paintings -- among the Snest in theMet's collection -- that were sent overseas in exchange.
The following year found museums across the county lobbying Congress to establish a permanent indemnity program rather than offering insurance on a case-by-case basis. In December of 1975, President Gerald Ford signed into law the Arts and Artifacts Indemnity Act, legislation that gave the Federal Council on the Arts and the Humanities authority to oversee an indemnity program to insure international exhibitions that come to U.S. museums. All indemnity agreements are backed by the full faith and credit of the United States Treasury in the event of loss or damage to an artwork. The NEA administers the program on behalf of the council, a coalition of Cabinet-level departments and agencies. Since that time, the program has indemnified nearly 900 exhibitions, saving the organizers more than $230 million in insurance premiums. Landmark indemnified exhibits have included not only works by the likes of Picasso, Michelangelo, and Monet, but archeological gems like relics from the tomb of King Tut, the Dead Sea Scrolls, and the Magna Carta. Only twice in the 33- year history of the program has the program actually paid out treasury funds: once when two Israeli paintings were stolen en route to Tel Aviv, and once when a modern French sculpture was damaged in transit.
In recent years, American museum directors have become more and more worried about the rising costs of insuring artworks that travel within U.S. borders. Th e 9/11 attacks prompted insurance hikes across the country, and in the aftermath of Hurricane Katrina, companies raised premiums for museums located in so-called disaster zones.
Not long after Katrina battered the Gulf region, Buchanan got a call from the Met. The museum was preparing to close down its American wing for renovation. Would the San Francisco museums like to borrow 90 classic American paintings? Buchanan's initial answer was "Yes."Then he found out insuring the exhibit would cost $9 million.
"I just couldn't do it," he said.
Th e situation brought new urgency to the domestic indemnity debate. On behalf of San Francisco's museums, the city attorney's office contacted museum directors from across the country, gathering support. Buchanan also reached out to California legislators, who lobbied Congress to pass the indemnity legislation.
"It was a nonpartisan effort, and it was a great eQort by Senator Dianne Feinstein, in particular," said Anita Defanis, government affairs director for the Association of Art Museum Directors. The indemnity legislation was included in the omnibus spending bill signed by President GeorgeW. Bush in December 2007.
Valuing the artworks is a crucial part of the indemnity process, explained Ian Kennedy, a curator at the Nelson-Atkins Museum of Art in Kansas City, Missouri, currently on the international indemnity panel. "It's a fascinating process," he said. Each artwork proposed for an exhibit must be appraised in U.S. dollars, but the panel must also take into account how a work is valued in its home country. So for example, a Monet would set auction records anywhere, but a Russian masterwork is most valuable in Moscow.
In September, Nelson-Atkins opened an indemnified exhibit, Art in the Age of Steam: Europe, America and the Railway, the first major international exhibit the museum has hosted in 20 years. It's the perfect exhibit for a Midwestern industrial city, Kennedy said, and without federal indemnity, no one in Missouri would be able to see it.
National Endowment for the Arts · an independent federal agency