Few homeowners have adequate insurance for artwork they own by failing to update their cover when they make a purchase or carry out regular valuations of the art, according to Hiscox.
Hiscox research shows that 80% of art collectors fail to have adequate art and antiques cover and 30% have never sought a valuation.
According to Datamonitor, homeowners find it hard to accurately estimate the value of their contents, particularly in the case of fine art and antiques.
In order to help tackle the problem, Hiscox and Art Market Research have developed the Hiscox Art Market Research Index (HAMR Index).
The Index is a unique tool designed to track the value of homeowners' belongings including art and other collectible items which are frequently underinsured.
Robin Duthy, Art Market Research said: "The HAMR Index is a unique resource allowing collectors of all levels to better gauge the value of all their investments and ensure their insurance cover is updated accordingly."
Robert Read the fine art underwriter of the Art and Private Client Division at Hiscox, added: “The HAMR Index will allow our clients to index link the values of their collections in the same way that the retail price index ensures that their general contents are more fully covered.
"It will be a big step forward in helping our clients make sure they are less likely to be underinsured.”
Hiscox will be rolling out the index out to all its brokers as of January 2006 to help advise individual policyholders on the value of their collections and future acquisitions.