Strategica Group has organized with ADSI (Italian Association of Buildings with Historic Value) on May 11 in Milano an event to talk about risks and insurance solutions to protect the country's private artistic heritage.
Historic buildings undoubtedly represent a precious artistic and cultural heritage for our country. However, their importance in economic and employment terms is no less important: with 45 million visitors a year (pre Covid) they constitute the largest Italian museum, second only to public museums with their 49 million visitors. The historic buildings have been transformed in business activities and are active in various sectors (hospitality, catering, hospitality, agri-food) generating a turnover of 272.5 million euros a year.
We're talking about villas and castles, former religious buildings, farmhouses and estates, palaces, gardens: unique assets, just as unique are the risks to which they are exposed and which their owners or managers have to face. Identifying these risks, mitigating them, seeking effective and tailor-made insurance solutions: this was the theme at the center of the event "Historic buildings: risks and insurance solutions" organized by Strategica Group with ADSI on May 11 in the splendid setting of the Vignale Residence (an historic private building in the heart of Milan).
"The insurance protection of historic buildings is a fundamental theme for us. Meetings like this one are precious to build an even closer collaboration and more effective communication between ADSI members and insurers. The former should point out better their needs and the critical issues they encounter, the latter should inform about the insurance solutions available and the risk management activities that historic buildings owners should put in place" said Giacomo di Thiene, President of ADSI, in his opening speech.
“Buildings with historic and artistic value have a particular and specific risk profile. Their peculiarities can make catastrophic a claim that for other types of assets would be easier to manage: just think of the Notre Dame de Paris case" explained Paola Radaelli, Senior Risk Consultant Strategica "The characteristics of these buildings can make recovery actions difficult and longer, the interventions (often subject to legal obligations) are specific and very expensive, and among other things there are few specialists available. The restoration of an Historic Building costs on average 30% more, and 38% of the owners say they find it difficult to find restorers or craftsmen”.
In addition to property and liability risks, the consequences deriving from business interruption should not be underestimated. "Following damage, a Historic Building can be forced to interrupt its business for months, with important consequences on turnover," explained Matia Barberio, Account Executive Strategica. "Having a business interruption policy can prove to be saving. The insurer provides compensation, calculated on the contribution margin or by means of a daily allowance or percentage, of all losses resulting from the total or partial interruption of the business. It is also possible to provide for compensation for higher costs incurred to resume activities, coverage relating to penalties following a failure or delay in contractual fulfillment, and reimbursement of expenses incurred in the event of incapacity for work by employees " .
Despite the risks and their potentially disastrous consequences, today most of the country's Historic Buildings are not adequately protected. Why? "It is a market niche that often does not fit with the risk appetites of insurance companies and consequently there are few specialized products on the market" explained Antonio Marchetti, Business Director Strategica "consequently, most of the - already few in number - Historic Buildings insured have generic policies that do not meet their real needs".
Starting from this assumption Strategica and an italian broker partner (Argo) have structured together with ADSI a specific insurance program for Historic Buildings, which today protects over 350 structures throughout the Italian territory. “This is a highly technical, tailor-made solution, unique on the market. It insures objects of historic and artistic value for the higher costs of reconstruction and restoration in compliance with the obligations, damage to the content, to the objects of art, to the arboreal heritage, and also guarantees the civil liability deriving from the ownership and management of the buildings and for the organization of events” explains Enrico Guarnerio, CEO Strategica.
"Already a good number of Historic Buildings can count on the protection of this program" concludes Pietro del Bono, President of ADSI Lombardia "but if we consider that in Italy there are over 17,000 structures classified as Historic Buildings that carry out some kind of commercial activity, we understand how much margin there is still to adequately protect this unique historical and artistic heritage ".
