How a Young Fine Arts Broker Expedited the Claims Experience for Her Clients
As a college student, Kristina Marcigliano pursued her passion for American history, focusing on the World War II era, with plans to become a high school history teacher. But after graduation, she took a pause before jumping into a career in education.
“I was looking for a temp job before I figured out what I wanted to do after school, so I took a position at a brokerage just doing admin work. They specialized in placing insurance for historical stamps and coins,” she said.
That brokerage was Hugh Wood Inc., whose owner was similarly smitten with historical objects — a “happy accident,” Marcigliano said.
Soon she was offered a full-time position assisting the claims team with losses connected to collectors’ items like stamps, coins and bullion.
“By working on claims, I was learning insurance sort of backwards. I was seeing what was happening to the property, how the policies were or were not responding. It taught me how to build a policy from the inside out,” she said.
The firm sent Maricigliano for her broker’s license, and the rest, as they say, is history.
Keeping a Focus on Claims
In 2013, she moved to DeWitt Stern, a division of Risk Strategies Company, to manage her own book of fine art clients as a senior account executive. Though she was applying her experience to build tailored insurance programs, she no longer had a hand in claims.
To her, this was a disconnect that resulted in less-than-ideal customer service and a missed opportunity to leverage the specialized expertise that a fine art broker must have.
Many brokerages with binding authority choose not to manage claims in-house because, on the surface, the two functions seem to contradict each other. Managing a claim resulting from a loss not covered by one of your own policies would seem to be an admittance of failure. Punting claim management back to the insurer makes that entity seem like the bad guy.
But Marcigliano believed that having difficult conversations around loss scenarios would in fact build trust with clients and that managing claims herself could result in better recovery.
“I felt that if I’m not going to be involved in the claims and continue advocacy at the most important time, what am I doing the first part for?” she said.
Early this year, she decided to bring a formal business proposal to management for the creation of a dedicated fine arts claims desk.
“I had to set up a model that would allow me to still handle a book of business while overseeing every fine art claim for our team.
“The first few months were hectic — it was a rough patch getting used to juggling the different roles — but I’ve being doing it since January of this year,” Marcigliano said.
So far, she’s managed about 45 claims and $6 million in policy payouts.
The Benefits of Advocacy and Expertise
Bringing claims in house has yielded benefits both for clients and the firm.
For clients, having a single point of contact and working with a familiar face usually means claims move more smoothly and quickly. And, because of Marcigliano’s training in fine arts and specie, she understands the nuances of valuating a loss.
Fine arts claims are not straightforward. Unlike in a commercial property policy, there’s no set repair or replacement cost.
Every policy has a custom valuation based on a number of factors including the medium, whether the artist is living or dead, the market value of a piece and the sentimental value to the owner.
Understanding these factors is critical to arrive at a fair loss value and avoid conflict in the process.
“We had a dealer, for example, who had a photograph damaged in their care, and they had to make the owner who had consigned it to them whole again,” Marcigliano said. “The artist was still living and willing to reprint and resign the photo. The cost would have been minimal — under $10,000.”
The owner, however, had no sentimental attachment to the piece and decided to opt for a payout instead of a replacement. Instead of working with their dealer, they went to their own homeowner’s insurance policy — which was not a specialty product — and received current retail value for the piece. The owner ended up walking away with more than $70,000.
“The owner of the piece made a profit instead of being made whole. And that’s due to lack of expertise on the brokerage side,” Marcigliano said.
“If you don’t have a fine art specialty broker, you could drag your feet and waste money trying to do a conservation or hiring an appraisal firm to determine pre-loss value or post-conservation value depreciation. Knowing what can and can’t be fixed makes a difference in how a claim plays out.”
Having that level of expertise at the table also brings clients peace of mind. Navigating a loss can be stressful and emotionally draining. Coaching clients through the process, however difficult, helps to build trust and strengthen relationships.
“When we have that conversation, it makes the client feel more comfortable. It’s not just their insurance company saying ‘no, this is denied.’ They get to know their policy better and have a more positive claim experience,” Marcigliano said.
That has translated to improved client retention and referrals. Most of the time, people care more about customer service and getting claims paid than they do about price.
“We’ve had at least two clients so far this year move their business to us just from hearing about and seeing our claims advocacy,” she said.
“I think as a broker, if you’re not advocating for your client from beginning to end, you’re not doing your job. It’s funny, I thought I was going to be a high school history teacher, and this just worked out so well.” &