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2018 Power Broker

Fine Arts

The Right Words

Kristina Marcigliano
Senior Account Executive
Risk Strategies/DeWitt Stern, New York

A great broker is not only well-versed in finding the right insurance but can also eloquently explain various coverages and solutions to clients outside the field — no easy task, to be sure.

Such is the case of Kristina Marcigliano.

“Kristina makes the complicated world of insurance easy to understand when she explains it to us lay people,” said Juan Angulo, controller, Bunny Williams Inc., an interior design company.

Earlier this year, Marcigliano sat down with Angulo to review the company’s insurance policies. She pointed out where they had gaps, where they could increase limits and answered questions as they arose.

Gerald Peters Gallery’s registrar Lindsey Lutz, who usually handles the gallery’s renewal process, was out of the office during renewal time this year. One of her colleagues stepped in — but she didn’t typically work with insurance and the jargon that comes with it.

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“Kristina walked my colleague through it and was extremely helpful and informative during the entire process,” Lutz said.

In another instance, another one of Marcigliano’s clients decided to begin a site renovation, turning its studio area into a place for art exhibitions.

“Kristina is there to see if there are any flags that come up that might impact our fine arts insurance,” said Susan Reynolds, director, The Milton Resnick and Pat Passlof Foundation. Her guidance provides peace of mind in the high-value world of fine art.

A Good Teacher Keeps Learning

Mary Pontillo
Senior Vice President
Risk Strategies/DeWitt Stern, Charlottesville, Va.

Mary Pontillo, DeWitt Stern’s national fine art practice leader, places value in educating her clients on the different types of insurance coverages available to them.

The Joan Mitchell Foundation was debating whether it should change its collection’s storage to a different facility. Pontillo listed the pros and cons of the possible move and was “proactive around brainstorming,” said Christa Blatchford, the foundation’s CEO.

Pontillo also took the time to build a loan and insurance rubric for the foundation, keeping the registrar, executive director, board members and lawyers on the same page during the art lending process.

“It makes the insurance conversation front-end instead of after the fact,” said Blatchford.

And like all good teachers, Pontillo never stops learning: “I was with her at a registrars’ conference,” said Thomas Burns, chief operating officer, The Fortress, which provides storage and transportation for fine art in Boston, Miami and New York. “Mary went to every possible session she could to learn as much as she could.”

One artist who was a client of The Fortress passed away last year, and his children needed to store his work. Burns planned the entire move, but the day before, he found that the family didn’t have insurance for transportation. He called Pontillo.

“Mary didn’t worry about what they didn’t do or what they didn’t have; she focused on the positives,” got the right insurance and had the art transported as planned, he said.

A Passion for Art

Adrienne Reid, CIC
Vice President
Aon/Huntington T. Block, Houston

“Adrienne Reid has a genuine interest in the pieces we have,” said Anne Breckenridge Barrett, director of collections and exhibitions, Museum of Contemporary Art Chicago.

It’s this dedication that convinced the museum to switch to Reid from their previous broker.

And this year, it proved to be the right choice. The museum held a 50-year anniversary celebration while also hosting a temporary Takashi Murakami exhibition at the same time. They had on display some of their most valuable pieces, including an original Andy Warhol.

To have both exhibitions under one roof, the museum needed to increase its policy limits and temporary policy limits. Reid got to work and kept the museum well under budget, negotiating lower premium rates with the underwriter.

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Ricardo Mazal, artist and owner of Ricardo Mazal Inc., had an exhibit in Mexico City. To cross the border, customs agents had to inspect the truck first, which meant they would need to handle the art and repackage it.

“Because of the logistics of the customs agents, it was a short time to work,” Mazal said.

Altogether, $1 million worth of paintings were handled and transported over the border. Few underwriters wanted to cover this high-risk load as it traveled through Mexico.

But Reid persevered.

“Adrienne [was] incredibly helpful; [she] was 24/7. At the end, she was able to have everything in place for us. I can count on her wherever I am with whatever we have.”

Queen of Conservation

Ever Song
Account Executive
Aon/Huntington T. Block, Washington, D.C

To prevent artwork from showing signs of the wear-and-tear of age, art conservationists take the lead in preserving and maintaining these valuable relics from the past.

And behind these conservators is Ever Song.

“I have been working with Ever for many years and couldn’t run my business without her,” said Leslie Gat, president and founder, the Art Conservation Group/Ransick Gat Fine Art Services Inc.

In 2016, she had several large projects moving in and out of the studio, which needed anywhere from $1 million to $3 million in waiver or policy coverage at different moments.

“Ever got me to bump up to half a million dollars in cost of coverage,” said Gat. “She lessened the stress and the cost didn’t go up as much as I thought it would.”

Deborah La Camera and Lorraine Bigrigg, both partners and senior conservators at Studio TKM Associates Inc., run a paper conservation studio where clients often need art procured and stored on the same day.

For instance, a collector of high-value drawings had a water issue in their storage facility and needed the art picked up and brought to the studio immediately. La Camera and Bigrigg called Song, who had to get the coverage in place while the art was transferred and stored at the studio.

“Ever streamlined the process and writes each contract to custom fit that art’s needs as well, showing clients their coverage is custom to their needs,” said La Camera.

Front and Center

Emily Weiss
Senior Account Executive
Risk Strategies/DeWitt Stern, New York

Emily Weiss likes the hands-on approach to insuring art.

When one of her clients needed to store artwork in its basement, Weiss visited with an underwriter to assess the area and any risks it posed to the safety of the pieces, and to come up with some risk mitigation strategies.

The policy in place had a basement flood exclusion, so Weiss suggested where to add water sensors and advised the client how to respond to a flood event. She also got them flood insurance, going above and beyond to secure them additional coverages for tidal waves or drain backups.

After Superstorm Sandy hit the East Coast, new insurance regulations regarding flood, wind and storm surge were implemented. Weiss’s client, Vito Schnabel Projects, wanted to review these regulations and work towards finding the best plan possible for their needs. Weiss took the reins.

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“Emily’s consultations have expanded my understanding of insurance procedures and requirements, which in turn has significantly improved our company’s coverage,” said Jenna Schneider, registrar.

She noted that, as she works with so many vendors daily, “Emily’s advice and prompt turnaround of information have allowed me to provide the best coverage to our vendors.”

“Everything she does is hands on,” said Edward Mishan, a private art dealer who sells around the world. “She’s efficient. She knows all the details.”

Problem Solver

Casey Wigglesworth
Account Executive
Aon/Huntington T. Block, Washington, D.C

The last call a museum registrar wants to receive is that a drunk driver ran into an outdoor sculpture.

Leah Reeder, registrar, Fort Wayne Museum of Art, unfortunately received that call, learning that a truck was wedged underneath an outdoor piece. Emergency officials were able to pull the truck out, but the sculpture collapsed.

Casey Wigglesworth was immediately brought on board.

“The sculpture was dismantled and sent to California for a little over a year for restoration,” said Reeder. “Casey took the time to work with me to get the piece back to us.”
Now the large sculpture sits in its Indiana home once again.

Another client, Michelle Moskal, assistant registrar, Museum of the American Revolution, detailed a recent move of facilities.

“We couldn’t transport everything all at once,” said Moskal. Their insurance covered up to a certain amount during transport, so Wigglesworth worked out what could be sent via truck together.

“We’re in the midst of an active construction site while remaining operational,” said Mark Ryan, assistant director for collections & exhibitions, the Mildred Lane Kemper Art Museum.

He said Wigglesworth provided critical insight into how to store art and keep staff and visitors safe during construction, communicating with the university and museum partners and providing information to their underwriters while the museum remained in operation.

Finalist:

Blair Wunderlich
Account Executive
Aon/Huntington T. Block
Washington, D.C.

More from Risk & Insurance

More from Risk & Insurance

Cyber Resilience

No, Seriously. You Need a Comprehensive Cyber Incident Response Plan Before It’s Too Late.

Awareness of cyber risk is increasing, but some companies may be neglecting to prepare adequate response plans that could save them millions. 
By: | June 1, 2018 • 7 min read

To minimize the financial and reputational damage from a cyber attack, it is absolutely critical that businesses have a cyber incident response plan.

“Sadly, not all yet do,” said David Legassick, head of life sciences, tech and cyber, CNA Hardy.

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In the event of a breach, a company must be able to quickly identify and contain the problem, assess the level of impact, communicate internally and externally, recover where possible any lost data or functionality needed to resume business operations and act quickly to manage potential reputational risk.

This can only be achieved with help from the right external experts and the design and practice of a well-honed internal response.

The first step a company must take, said Legassick, is to understand its cyber exposures through asset identification, classification, risk assessment and protection measures, both technological and human.

According to Raf Sanchez, international breach response manager, Beazley, cyber-response plans should be flexible and applicable to a wide range of incidents, “not just a list of consecutive steps.”

They also should bring together key stakeholders and specify end goals.

Jason J. Hogg, CEO, Aon Cyber Solutions

With bad actors becoming increasingly sophisticated and often acting in groups, attack vectors can hit companies from multiple angles simultaneously, meaning a holistic approach is essential, agreed Jason J. Hogg, CEO, Aon Cyber Solutions.

“Collaboration is key — you have to take silos down and work in a cross-functional manner.”

This means assembling a response team including individuals from IT, legal, operations, risk management, HR, finance and the board — each of whom must be well drilled in their responsibilities in the event of a breach.

“You can’t pick your players on the day of the game,” said Hogg. “Response times are critical, so speed and timing are of the essence. You should also have a very clear communication plan to keep the CEO and board of directors informed of recommended courses of action and timing expectations.”

People on the incident response team must have sufficient technical skills and access to critical third parties to be able to make decisions and move to contain incidents fast. Knowledge of the company’s data and network topology is also key, said Legassick.

“Perhaps most important of all,” he added, “is to capture in detail how, when, where and why an incident occurred so there is a feedback loop that ensures each threat makes the cyber defense stronger.”

Cyber insurance can play a key role by providing a range of experts such as forensic analysts to help manage a cyber breach quickly and effectively (as well as PR and legal help). However, the learning process should begin before a breach occurs.

Practice Makes Perfect

“Any incident response plan is only as strong as the practice that goes into it,” explained Mike Peters, vice president, IT, RIMS — who also conducts stress testing through his firm Sentinel Cyber Defense Advisors.

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Unless companies have an ethical hacker or certified information security officer on board who can conduct sophisticated simulated attacks, Peters recommended they hire third-party experts to test their networks for weaknesses, remediate these issues and retest again for vulnerabilities that haven’t been patched or have newly appeared.

“You need to plan for every type of threat that’s out there,” he added.

Hogg agreed that bringing third parties in to conduct tests brings “fresh thinking, best practice and cross-pollination of learnings from testing plans across a multitude of industries and enterprises.”

“Collaboration is key — you have to take silos down and work in a cross-functional manner.” — Jason J. Hogg, CEO, Aon Cyber Solutions

Legassick added that companies should test their plans at least annually, updating procedures whenever there is a significant change in business activity, technology or location.

“As companies expand, cyber security is not always front of mind, but new operations and territories all expose a company to new risks.”

For smaller companies that might not have the resources or the expertise to develop an internal cyber response plan from whole cloth, some carriers offer their own cyber risk resources online.

Evan Fenaroli, an underwriting product manager with the Philadelphia Insurance Companies (PHLY), said his company hosts an eRiskHub, which gives PHLY clients a place to start looking for cyber event response answers.

That includes access to a pool of attorneys who can guide company executives in creating a plan.

“It’s something at the highest level that needs to be a priority,” Fenaroli said. For those just getting started, Fenaroli provided a checklist for consideration:

  • Purchase cyber insurance, read the policy and understand its notice requirements.
  • Work with an attorney to develop a cyber event response plan that you can customize to your business.
  • Identify stakeholders within the company who will own the plan and its execution.
  • Find outside forensics experts that the company can call in an emergency.
  • Identify a public relations expert who can be called in the case of an event that could be leaked to the press or otherwise become newsworthy.

“When all of these things fall into place, the outcome is far better in that there isn’t a panic,” said Fenaroli, who, like others, recommends the plan be tested at least annually.

Cyber’s Physical Threat

With the digital and physical worlds converging due to the rise of the Internet of Things, Hogg reminded companies: “You can’t just test in the virtual world — testing physical end-point security is critical too.”

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How that testing is communicated to underwriters should also be a key focus, said Rich DePiero, head of cyber, North America, Swiss Re Corporate Solutions.

Don’t just report on what went well; it’s far more believable for an underwriter to hear what didn’t go well, he said.

“If I hear a client say it is perfect and then I look at some of the results of the responses to breaches last year, there is a disconnect. Help us understand what you learned and what you worked out. You want things to fail during these incident response tests, because that is how we learn,” he explained.

“Bringing in these outside firms, detailing what they learned and defining roles and responsibilities in the event of an incident is really the best practice, and we are seeing more and more companies do that.”

Support from the Board

Good cyber protection is built around a combination of process, technology, learning and people. While not every cyber incident needs to be reported to the boardroom, senior management has a key role in creating a culture of planning and risk awareness.

David Legassick, head of life sciences, tech and cyber, CNA Hardy

“Cyber is a boardroom risk. If it is not taken seriously at boardroom level, you are more than likely to suffer a network breach,” Legassick said.

However, getting board buy-in or buy-in from the C-suite is not always easy.

“C-suite executives often put off testing crisis plans as they get in the way of the day job. The irony here is obvious given how disruptive an incident can be,” said Sanchez.

“The C-suite must demonstrate its support for incident response planning and that it expects staff at all levels of the organization to play their part in recovering from serious incidents.”

“What these people need from the board is support,” said Jill Salmon, New York-based vice president, head of cyber/tech/MPL, Berkshire Hathaway Specialty Insurance.

“I don’t know that the information security folks are looking for direction from the board as much as they are looking for support from a resources standpoint and a visibility standpoint.

“They’ve got to be aware of what they need and they need to have the money to be able to build it up to that level,” she said.

Without that support, according to Legassick, failure to empower and encourage the IT team to manage cyber threats holistically through integration with the rest of the organization, particularly risk managers, becomes a common mistake.

He also warned that “blame culture” can prevent staff from escalating problems to management in a timely manner.

Collaboration and Communication

Given that cyber incident response truly is a team effort, it is therefore essential that a culture of collaboration, preparation and practice is embedded from the top down.

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One of the biggest tripping points for companies — and an area that has done the most damage from a reputational perspective — is in how quickly and effectively the company communicates to the public in the aftermath of a cyber event.

Salmon said of all the cyber incident response plans she has seen, the companies that have impressed her most are those that have written mock press releases and rehearsed how they are going to respond to the media in the aftermath of an event.

“We have seen so many companies trip up in that regard,” she said. “There have been examples of companies taking too long and then not explaining why it took them so long. It’s like any other crisis — the way that you are communicating it to the public is really important.” &

Antony Ireland is a London-based financial journalist. He can be reached at [email protected] Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]