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99 -- One Fine Art Insurance Policy to insure loaned art for the Department of State''s Art in Embassy Program

Solicitation Number: SALMEC-02-Q-0371
Agency: Department of State
Office: Office of Acquisitions
Location: Acquisition Management
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SALMEC-02-Q-0371
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Presolicitation
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Added: May 31, 2002
ALL- OR- NONE. MUST MEET ALL SPECIFICATIONS. SPECIFICATIONS REQUIRED. LOWEST PRICE TECHNICALLY ACCEPTABLE (LPTA).

One Fine Art Insurance Policy





NOTE: IN THE EVENT OF A CONFLICT BETWEEN POLICY AND CONTRACT, THE CONTRACT WILL PREVAIL.







Point of Contact: Kevin T. McGhee (703) 875-4566.



E-mail all questions to Kevin T. McGhee at mcgheekt@state.gov by June 7, 2002.



Quotes (solicitation has been uploaded) shall be faxed by the deadline, 11 June 2002, 12:00pm EDT to (703) 875-6292. Vendors shall call P.O.C. after faxing quote to confirm receipt.



One Fine Art Insurance Policy (1ea.)



Period of Performance: 06/17/02-02/28/03.







SCOPE OF WORK: Continuation of fine arts insurance coverage for works of art valued at $20,000,000 on loan to the Department of State, Art in Embassies Program and exhibited at posts worldwide.



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ART IN EMBASSIES COVERAGE



1. DESCRIPTION OF COVERAGE



a. PROPERTY COVERED

This policy covers only property described in the schedule dated May 28, 2002 and any items added thereto, on file with the Art in Embassies Program.



b. PERILS COVERED

This policy covers the described property against all risk of loss or damage to such property including War and Terrorism, except hereinafter excluded.



c. EXCLUSIONS



This policy does not insure against loss or damage due to, caused by, or resulting from:



(1) Wear and tear, gradual deterioration, insects, vermin, inherent vice, or any unauthorized repairing, restoration or retouching process.



(2) Nuclear exclusion as defined below:



Loss by nuclear reaction or nuclear radiation or radioactive contamination, all whether controlled or uncontrolled and whether such loss be direct or indirect, proximate or remote, or be it whole or in part caused by, contributed to, or

aggravated by the peril(s) insured against in this policy. But whether this policy does insure against the peril of fire, then the preceding clause will NOT be effective, and the following clause will apply: loss by nuclear reaction or nuclear radiation or radioactive contamination, all whether controlled or uncontrolled, and whether such loss be direct or indirect, proximate or remote, or be whole or in part caused by, contributed to, or aggravated by the peril(s) insured against in this policy; however, subject to the foregoing and all provisions of this policy, direct loss by fire resulting from nuclear reaction or nuclear radiation or radioactive contamination is insured against by this policy.



(3) Confiscation, Expropriation and Deprivation are excluded.

d. TERRITORY



This policy covers the described property while at the premises specified per the schedule or on exhibition or while in transit.



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2. LIMIT OF COVERAGE



This company shall not be liable for more than:



a. $5,000,000 while in transit, or otherwise within the policy limits.



b. $5,000,000 in any one loss, disaster or casualty which is the aggregate amount insured.



c. The aggregate amount insured is $20,000,000.

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3. VALUATION



a. With respect to agreed scheduled items, the Company shall not be liable for more than the amount set opposite the respective articles, which amounts are agreed to be the values of said articles for the purpose of this insurance.

b. In the event of the total loss of any article or articles which are part of a set, the Company agrees to pay the Insured the full amount of the value of such set as specified in this schedule, and the Insured agrees to surrender the remaining article or articles to the Company.

c. Loss of value of an object is included up to the total value of the insured object.



4. OTHER INSURANCE



It is agreed that this policy is primary to covered items loaned to the Department of State under this Program.



5. GENERAL CONDITIONS



a. CARRIERS OR BAILEES



This insurance shall not insure directly or indirectly to the benefit of any carrier, not without the affirmative consent of the insured, to the benefit of any other bailee. The Insured may accept without prejudice to this insurance the ordinary bills of lading used by common carriers, including released or partially released value bills of lading used by common carriers.



b. MISREPRESENTATION AND FRAUD



This entire policy shall be void if, whether before or after a loss, the Insured has concealed or misrepresented any material fact or circumstance concerning this insurance or the subject thereof, or the interest of the Insured therein, or in any case of any fraud or false swearing by the Insured relating thereto.



c. NOTICE OF LOSS



The Insured shall as soon as practicable report in writing to the Company or its agent every loss, damage or occurrence which may give rise to a claim under this policy and shall also file with the Company or its agent every loss, damage or occurrence which may give rise to a claim under this policy and shall also file with the Company or its agent within ninety (90) days from the date of discovery of such loss, damage or occurrence, a detailed sworn proof of loss.



d. EXAMINATION UNDER OATH



The Insured, as often as may be reasonably required, shall exhibit to any person designated by the Company all that remains of any property herein described, and shall submit, and insofar as is within his or their power cause his or their employees, members of the household and others to submit to examination under oath by any person named by the Company and subscribe the same; and, as often as may be reasonably required, shall produce for examination all writings, books of account, bills, invoices and other vouchers, or certified copies thereof if originals be lost, at such reasonable time and place as may be designated by the Company or any of its employees or representatives in connection with the

investigation of any loss or claims hereunder, shall be deemed a waiver of any defense which the company might otherwise have with respect to any loss or claim, but all such examinations and acts shall be deemed to have been made or done without prejudice to the company's liability.



e. SETTLEMENT OF LOSS



All adjusted claims shall be paid or made good to the Insured within thirty (30) days after presentation and acceptance of satisfactory proof of interest and loss at the office of the company. No loss shall be paid or made good if the Insured has collected the same from others.



f. SUBROGATION OR LOAN



If in the event of loss or damage the Insured shall acquire any right of action against any individual, firm or corporation for loss of or damage to property covered hereunder, the Insured will, if requested by the Company, assign and transfer such claim or right of action to the Company, or at the company's option

execute and deliver to the Company the customary form of loan receipts upon receiving an advance of funds in respect of the loss or damage; and will subrogate the company to, or will hold in trust for the Company, all such rights of action to the extent of the amount paid or advanced, and will permit suit to be brought in the Insured's name under the direction of and at the expense of the Company.



g. LOSS CAUSE



Any loss hereunder shall not reduce the amount of this policy, except in event of payment of claim for total loss of any item specifically scheduled hereon. If claim is paid for total loss of one or more specifically scheduled items hereon, the unearned premium applicable to such items will be refunded to the Insured or applied to the premium due on item(s) replacing those on which the claim was paid.



h. PROTECTION OF PROPERTY



In case of loss, it shall be lawful and necessary for the Insured, his or their factors, servants and assigns, to sue, labor, and travel for, in and about the defense, safeguard and recovery of the property insured hereunder, or any part thereof, without prejudice to this insurance, nor shall the acts of the Insured or the company, in recovering, savings and preserving the property insured in case of loss be considered a waiver of an acceptance of abandonment. The expenses so incurred shall be borne by the Insured and the Company proportionately to the extent of their respective interests.



i. SUIT



No suit, action or proceeding for the recovery of any claim under this policy shall be sustainable in nay court of law or

equity unless the same be commenced within twelve (12) months next after discovery by the Insured of the occurrence which gives rise to the claim, provided however, that if by the laws of the State within which this policy is issued such limitation is invalid, that any such claims shall be void unless such action, suit or proceeding be commenced within the shortest limits of time permitted by the laws of such State.



j. APPRAISAL - NONSCHEDULED ITEMS



If the Insured and the Company fail to agree as to the amount of loss, each shall, on the written demand of either, made within sixty (60) days after receipt of proof of loss by the company, select a competent and disinterested appraiser, and the appraisal shall be made at a reasonable time and place. The appraisers shall first select a competent and disinterested umpire, and failing for fifteen (15) days to agree upon such umpire, then on the request of the Insured or the Company, such umpire shall be selected by a judge of a court of record in the State in which this policy is issued. Such appraisers shall appraise the loss, stating separately the actual cash value at the time of loss and the amount of loss, and failing to agree shall submit their differences to the umpire. An award in writing of any two shall determine the amount of loss. The

Insured and the Company shall each pay his or its chosen appraiser and shall bear equally the other expenses of the appraisal and umpire. The company shall not be held to have waived any of its rights by act relating to appraisal.



k. CANCELLATION AND NONRENEWAL



(1) Cancellation

For the reason stated in (a) and (b) below only, the Company may cancel this policy by mailing to the first Named Insured written notice of cancellation at least thirty (30) days before the effective date of cancellation. At least five (5)days before sending notice to the first Named Insured, the company will notify the agent or broker, if any, who wrote the policy.



(a) If this policy has been in effect for thirty (30) days or less and is not a renewal of a policy the company issued, they may cancel this policy for any reason.



(b) If this policy has been in effect for more than thirty (30) days, of if this policy is a renewal of a policy the Company issued, the Company may cancel this policy only for one or more of the following reasons:



(i) The Insured has refused or failed to pay a premium due under the terms of the policy;

(ii) The Insured made a material and willfull misstatement or omission of fact to the Company of their employees, agents or brokers in connection with any application to or claim against the company;

(iii) The Insured has transferred its property or other interest to a person other than itself or its beneficiary, unless the transfer is permitted under the terms of the policy; or

(iv) The property, interest or use of the property or interest has materially changed with respect to its insurability.



(2) Nonrenewal



The company may elect not to renew this policy by mailing or delivering notice or nonrenewal to the first Named Insured's last mailing address known to the company. The company will mail or deliver the notice at least sixty (60) days before the expiration of the policy. At least five (5) days before sending notice to the first Named Insured, the company will notify the agent or broker, if any, who wrote the policy. If notice is mailed, proof of mailing will be sufficient proof of notice. Delivery of the notice will be the same as mailing.



l. CONFORMITY TO STATUTE



Terms of this policy which are in conflict with the statutes of the State wherein this policy is issued are hereby amended to conform to such statutes.



m. CHANGES



Notice to any agent or knowledge possessed by any agent or by any other person shall not effect waiver or a change in any part of this policy or stop the Company from asserting any right under the terms of this policy, nor shall the terms of this policy be waived or changed, except by endorsement issued to form a part of this policy.





NOTE: IN THE EVENT OF A CONFLICT BETWEEN POLICY AND CONTRACT, THE CONTRACT WILL PREVAIL.













Art in Embassies

May 28, 2002 Values for the Following Locations



Amman $69,000

Athens $680,450

Baku $26,450

Beijing $2,580,000

Belize $82,825

Berlin $125,400

Bridgetown $21,000

Budapest $352,000

Chisinau $103,500

Colombo $54,600

Dublin $1,968,000

Geneva Arms Control and Disarmament Agency $54,500

Geneva United Nations $53,775

Harare $51,700

Jakarta $75,200

Kingston $25,200

Kinshasa $135,200

Kuala Lumpur $101,600

Ljublijana $31,100

Luanda $128,700

Madrid $1,208,000

Manama $34,500

Moscow $142,020

Nicosia $323,800

Paris $853,500

Paris Organization for Economic Cooperation and Development $96,500

Port Moresby $24,450

Prague $1,184,500

Quito $71,750

Riyadh $132,200

San Jose $41,400

Seoul $266,600

St. Petersburg $40,980

Tallinn $55,550

The Hague $4,678,000

Ulaanbatar $21,400

Valletta $97,700

Vatican $486,000

Vienna $1,699,100

Vienna Organization for Security and Cooperation in Europe $208,650

Vienna United Nations $127,049

TOTAL $18,513,849









ART IN EMBASSY: $20 Million Coverage



The following information is being provided to all showing an interest in the above solicitation.



1) Loss Information



1998-1999: 7 losses totalling USD 11,581 0.023162% of $50 million total exposure;



1999-2000: 7 losses totalling USD 15,510 0.03102% of $50 million total exposure;



2000-2001: 7 losses totalling USD 9,044 0.011305% of $80 million total exposure;



2001-2002: 8 claims totalling USD 56,100





2) Protection of property while in transit and on display.



Works of art are handled by art transport companies recognized by the American Association of Museums. The cargo is supervised by bonded warehouses at international air freight centers. Works of art are protected by 24/7 security guards and household staff while in the ambassadors residences.



3) Methods used to establish the property values of each artwork.



Works of art are valued based on current market values by the lender.



4) Intent as respect to unscheduled property.



There is no unscheduled property. All property is scheduled and documented as such in the loan agreement. No object is insured without one.



5) Name (s) of insurance carrier (s) and broker (s) for the most recent five years.



Current: Thomson and Pratt;

A.I. King Insurance;

DH Lloyd and Associates;

Hartford;

St. Pauls;



6) History of the program.



Art in Embassy Program has been in existence for 38 years.





7) Location of art.



Art is housed and displayed in the Official US Ambassador?s Residence in the host country.

All residences are US Government owned or leased properties with a minimum of 24 hour armed guard security presence with barricades or barriers around the perimeter.



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Department of State, Office of Logistics Management, Acquisition Management, P.O. Box 9115 Rosslyn Station, Arlington, VA, 22219
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VARIOUS POSTS OVERSEAS (SEE SCHEDULE)
:
Kevin McGhee, Contract Specialist, Phone 7038754566, Fax 7038756292, Email mcgheekt@state.gov