Are You Still in Good Hands?
By Ben Wilda and Alaina McWhorter, Private Client Risk Advisors
True claims story: A heating and cooling technician recently fell almost twenty feet after dropping through a customer’s attic floor. The technician sustained serious injuries and was awarded $8.9 million in damages, which exceeded the policyholder’s primary liability coverage limit.
Accumulating wealth expands your lifestyle and risk simultaneously. The natural consequence of building wealth is acquiring more assets: larger homes, vacation properties, cultivated art or jewelry collections, and even fun toys, like collector cars or watercraft. Owning more assets brings new levels of exposure that require a sophisticated approach to insurance protection.
As individuals and families build wealth, common risks appear:
• Non-profit board membership
• High-value property ownership
• Large art, jewelry, and other valuables collections
• LLC and trust-owned assets
• Net worth exceeding $5 million
When wealth grows, families often consult the same standard insurance broker they have used and relied on for years (or even generations), not knowing this approach can limit their ability to obtain the best coverage and pricing in the market. Gaps in coverage can widen far beyond acceptable levels of risk, and leveling up your insurance is critical to ensure a protected future.
Unlike standard insurance companies, private client insurance companies utilize specialized pricing structures and broadened policy language to meet the specific needs of successful individuals and families. Guaranteed home replacement cost, higher limits of water backup coverage, cyber protection, and agreed value replacement on vehicles and collections are just some examples of the broadened coverage types you can expect from a private client company.
Private client insurance companies are also more comfortable with complex risks than standard companies, and it’s often easier to find coverage for the following:
• Homes valued at over $2 million
• Excess liability coverage for LLCs and trusts
• Excess liability coverage limits of $5 million and above
• Large valuables collection without tedious appraisals
• Luxury vehicles valued at over $150,000
The path to sufficient protection starts with recognizing that sometimes the hands your coverage has been in are not the right ones to take you and your family forward.
Think You’re Fully Covered? Ask Yourself These Four Questions
1. Does my total net worth exceed $5 Million?
If the answer is yes, consider purchasing an umbrella policy limit to match your total net worth.2. Was my home insurance issued before 2020?
Inflation, post-COVID supply chain issues, and the increased cost of building materials have significantly increased home replacement values since 2020. If your home insurance policy was issued before the pandemic, your dwelling limit is likely below the value you need to rebuild your home. Request an updated home “replacement cost estimate” from your insurance company to ensure your properties are insured at the correct values.
3. Does my umbrella policy cover each one of my personal real assets and the corresponding ownership interest?
Start by ensuring that your umbrella policy covers your personal assets, such as homes, cars, vacant lots, golf carts, watercraft, and rental properties. Then, if it applies to you, confirm that the umbrella also includes any trusts or LLCs that own assets as an additional insured. Standard insurance companies typically do not allow you to include an LLC on your umbrella policy, but many private client companies do.
4. Do I have a single point of contact that manages my personal insurance program?
The more insurance agents and companies you work with, the greater your risk of coverage gaps. Working with one professional across all your exposures allows for a better understanding of your overall risk, offering a holistic overview of your entire insurance program to ensure every policy works in tandem. As an added benefit, you often save money working with a single insurance company or point of contact that can provide bundled insurance program options.
Customized Insurance for Your Lifestyle
Our expert private client risk advisors will conduct a thorough review of your existing policies to identify any gaps in coverage and opportunities to leverage specialized solutions designed for your lifestyle.