A dynamic Asian fine art market is attracting enthusiastic consumers and investors as its influence builds on the global stage. But the uniqueness of fine art is both blessing and challenge, and tailored fine art risk management is essential to protect such valuable one-off pieces.

The Asian fine art market has undergone significant changes in recent years.

According to the Art Market 2023 Art Basel & UBS report, global art sales increased 3% year-on-year to an estimated $67.8bn.

Art collection

This brought the market back above pre-pandemic levels. However, performance was varied by sector region, and price segment.

The US, China and the UK continued to account for the majority of sales, with a combined share of 80%.

China’s art market had a difficult year, which ultimately led to market share decreasing by 3%. Lockdowns stalled activity in some regions, restricting access and supply, and sales were curtailed by a strict zero-COVID policies.

Overall sales in China declined by 14% year-on-year to $11.2bn, their econd-lowest level since 2009.

$67.8bn: the value of art sales made worldwide this year


However, the report found that some of the strongest sales increases were reported by Asian dealers, including a 28% increase in Japan and close to 40% in South Korea.

The latter, the report found, received a boost from the intense focus created by the launch of Frieze Seoul in September.

Jennifer Scally, head of fine art & specie, Asia, AXA XL, says: “Asia, particularly China and Southeast Asia, has experienced substantial economic growth, creating a larger and wealthier base of potential art collectors. As disposable incomes rise, more individuals are entering the art market as buyers and investors.

“In addition, the expansion of the middle class in many Asian countries has led to increased art consumption. Art is not only seen as an investment but also as a status symbol and a reflection of cultural identity.”

”Uniqueness can be a double-edged sword. While it adds to the intrinsic value and desirability of the artwork, it also means that its loss or damage cannot be easily rectified.”

The Asian art market has also become ;more integrated into the global art scene, with collectors actively participating in international art auctions and exhibitions, and Asian artists gaining recognition worldwide.

The proliferation of art fairs and exhibitions across Asia has stimulated interest in art and facilitated transactions. Events like Art Basel Hong Kong and Art SG in Singapore have become major platforms for showcasing and selling art.

Scally says: “The Asian art market is increasingly dynamic and influential on the global stage, making it an area of interest for both collectors and investors.

“Some Asian buyers see art as an alternative investment asset. They are drawn to art as a store of value and a potential source of financial returns.”


This vibrant market comes with its own set of unique risks. The six key threats to be aware of are: water damage, flood, fire, theft, accident loss, and loss related to transit.

It is interesting to note that 60% of losses are transit related. Fine art and collectibles are most often damaged by improper handling while in transit, water leakage, and by smoke or water following a fire.

Scally says: “Each piece of fine art is unique, making it irreplaceable. But this uniqueness can be a double-edged sword. While it adds to the intrinsic value and desirability of the artwork, it also means that its loss or damage cannot be easily rectified.

“This stresses the importance of risk management and insurance for art.

“Collectors and institutions may have strong emotional attachments to their art collections. This emotional connection can further complicate the financial and emotional consequences of a loss, emphasising the importance of insurance and risk mitigation.

60% of all fine art losses come from accidents occurring during transit

“For all these reasons, the risk profile of fine art is unique and complex.”

New risks are also emerging. Museums and galleries are increasingly vulnerable to the impact of climate change, with extreme weather events such as typhoons, flooding, bushfires and hurricanes becoming more frequent and severe.

These events can cause extensive damage to art collections as well as the infrastructure of the museums and galleries, especially in areas that were previously less prone to such weather.

In addition, climate change can result in higher temperatures and humidity levels, which can accelerate the deterioration of artworks and artefacts.

Scally says: “In view of these risks, I cannot stress enough the importance of fine art insurance. This mitigates the risks associated with these threats.

“At AXA XL, we emphasise the importance of working with insureds to prevent loss through robust risk management capabilities. By taking proactive measures, the likelihood of art-related incidents can be significantly reduced, further safeguarding the value of art collections.”


Water damage

Damage resulting for example from leaks or burst pipes is a very significant risk to artworks and collections.


This can lead to extensive damage to artworks.

Loss related to transit

When artworks are transported to and from exhibitions or storage facilities, they are at risk of damage during transit.


Fire can spread quickly, resulting in a devastating loss of valuable artworks.


While art thefts can garner a lot of media coverage, they are actually relatively uncommon.

Accident loss

Damage during handling, installation, or routine maintenance comes under the label of ‘accident loss’.


It is important to conduct a comprehensive risk assessment to identify threats, considering natural disasters and emerging risks. Scally advises risk managers to approach this assessment by considering four key areas:

  • Construction of the building, ensuring the structure of a building is stable
  • Occupancy of the building, ensuring that the surrounding buildings do not pose any risks {with no fire hazards)
  • Protection of the premises, i.e., are there security systems to safeguard valuable collections?
  • Appointing an art specialist, shipper and packer when transporting art or collectibles

She concludes: “Many pieces of art or collectibles are irreplaceable, and insurance can’t compensate for their emotional loss. Undoubtedly, art is an investment deserving of protection to preserve its financial value.”