The fine art insurance sector has long been a pillar of stability in the broader specialty insurance market. However, as 2025 unfolds, a combination of high-profile losses, climate risks, and a shifting risk appetite among underwriters is beginning to reshape the industry. While the market remains competitive for lower-risk clients, signs of hardening are increasingly evident—particularly for collectors, galleries, and institutions in catastrophe-prone areas.
A Market Balancing Growth and Risk
Over the past two years, there has been an influx of capacity with more insurers entering the fine art market, drawn by its strong profitability. High-net-worth collectors, museums, and galleries alike have benefited from this increased competition, keeping rates stable in 2024 – particularly for clients with minimal claims histories and well-protected storage or exhibition spaces.
Nevertheless, 2025 has begun with turbulence. The devastating Palisades wildfires have resulted in one of the most catastrophic fine art losses in history. While traditional property insurers brace for aggregate losses in the range of $30-50 billion, fine art insurers face claims that could surpass $1 billion–bolstered by pieces by Andy Warhol, Keith Haring and Damien Hirst—potentially making it the largest-ever payout in the sector, eclipsing the $500 million loss from Hurricane Sandy in 2012.
The implications are twofold. First, rates for high-risk locations—particularly in fire-prone and flood-exposed areas—are set to rise sharply, with some forecasts predicting increases of 15-20%. Second, underwriting scrutiny is expected to tighten considerably with insurers demanding more detailed information on transits, storage conditions, and climate risk mitigation, making it harder for collectors and institutions to secure favourable terms.
The Cyber Threat to the Art World
Beyond natural catastrophes, digital threats are an increasingly pressing concern. A series of cyber incidents—including attacks on Gallery Systems, Christie’s, and a widespread CrowdStrike vulnerability—has heightened awareness of digital risks in the art sector. Cybercrime affecting fine art typically manifests through fraudulent shipping documents, invoice manipulation, and data breaches that expose sensitive transactional records.
As a result, insurers are encouraging clients to procure cyber policies with provisions for physical loss or damage caused by digital fraud. While cyber cover remains a niche within fine art insurance, the rising number of incidents suggests it may become a standard component of comprehensive policies in the coming years.
What Lies Ahead?
Despite challenges, fine art insurance remains an attractive space for insurers. Premiums for well-managed risks—such as professionally packed and shipped transit—are holding steady. Exhibition insurance, too, remains stable, though underwriters are becoming more vigilant about potential vandalism risks at public events.
However, the sector is approaching an inflection point. If catastrophic claims continue to mount, capacity may retract, leading to a hardening market. Underwriters are already signalling their intent to push for broader premium bases, particularly as reinsurers reassess their appetite for high-value collections in exposed locations.
For collectors and institutions, the message is clear: prepare for more stringent underwriting, reassess valuations, and ensure that risk mitigation strategies—whether for climate, cyber, or transit risks—are robust enough to meet insurers’ evolving demands.
For those looking to stay ahead of these shifts, expert guidance is key. Panthera Insurance Partners provides tailored fine art insurance solutions, ensuring your collection is protected against the evolving risks of 2025 and beyond. Contact us to secure your assets with confidence.
