If you are gaining significant assets, you have extra risks that require more comprehensive insurance coverage. Sometimes, a standard policy simply will not work. That’s why select carriers specialize in unique insurance products that embrace the needs of high-net-worth individuals and families.
Typically, there are two overarching risks that impact how affluent clients insure their assets:
Property: Many affluent individuals own more luxury assets, indicating that it costs more to get repaired or replaced, and you have more to lose (especially if you’re underinsured).
Liability: If a third-party accident occurs, there is always the possibility that people will take advantage of your established wealth.
To address these risks, your coverage should be flexible, customizable, and consider your time. This can be accomplished when your insurance advisors understand how to engage with your wealth confidently, compare carriers on your behalf, and advocate for your fortune. Here are a few key insurance products that cater to the needs of high-income clients.
Fine art, jewelry, wine, antiques, instruments, or other valuable collectibles need to be specifically insured. Your Homeowner’s policy will typically cover these contents at 50-70% of your dwelling limit. However, unless collections are specifically “scheduled” (or mentioned) in the policy, they may not be fully covered, as significant sub-limits can apply.
The risk of owning a horse(s) goes beyond the wellbeing and mortality of the animal itself. The most prevalent risk is liability. Even if you board at an established ranch, you are still legally responsible for any injuries or damage (both on and off property) that your horse initiates. This means you’re also financially responsible for damage, medical bills, legal fees, and more.
Employment Practices Liability Insurance (EPLI):
If you employ staff to maintain your lifestyle, home(s), or investment properties (such as nannies, home managers, chefs, personal assistants, security, and others), EPLI is necessary in case you are sued for actual or perceived wrongdoing.
Any homeowner deserves proper insurance, but you may have multiple high-value homes around the world that serve you and your family in various ways. You will need a policy that encompasses all your risks, including unique climates and periods of unoccupancy.
Independent Director’s Liability Insurance (IDL)
If you serve as a governing board member, your risk level will be determined by your decision-making authority. The more authority, the more potential personal liability, and need for protection beyond what the organization provides.
This is a contract that exchanges premiums for a guarantee that the insurance company will give a sum of money upon death to named beneficiaries. While most can benefit from Life Insurance, this product appeals specifically to the wealthy for tax purposes and added protection to keep assets in the family.
This directly addresses your liability risk, as it provides excess liability coverage specifically for larger claims that surpass personal policy limits. It’s favored for offering broader coverage for incidents like slander or global travel.
Just as you need Auto Insurance for the road, you also need property and liability protection for your vessels that float.
PRO TIP: Find an insurance advisor who partners with your financial advisor. Insurance and wealth management go hand in hand, as they each seek to grow and protect what you’re building.
With direct experience in managing substantial resources with the upmost discretion, we understand how to provide support beyond the policy. To learn which combination of affluent insurance products best fit your needs, connect with an expert advisor.