Longevity risks, cryptocurrency taxation and the potential for behavioural biases to hurt wealth are featuring strongly in our current conversations with clients.
Affluent individuals can face a real administrative battle to arrange adequate insurance for their properties, vehicles and treasured possessions. But going with a private client provider well-versed in the needs of High Net Worth Individuals will take the strain – and risk – out of what can be a very complex undertaking.
Many people think of insurance as a “grudge purchase” – something which you absolutely must have, but which sparks very little joy. Organising insurance policies can be a tedious task, particularly for those with a range of assets, and we often only perceive their value once a disaster has occurred.
However, by going down the private client route, insurance stops being just a bitter pill to swallow. Instead, you can start to think of it as an investment into having real peace of mind and a more streamlined life.
The first reason the affluent need better insurance than the man on the street is of course that they have more to protect. For instance, a regular household insurance policy may only cover single items up to a value of £5,000 and it is likely that the HNW will own many valuables worthfar more than that.
The second is the sheer range of assets the wealthy need to insure. Aside from jewellery and high-end watches, there are likely to be art, antiques, designer handbags (and clothes), wine and collectibles within the home along with several expensive vehicles on the drive – and that’s just the primary residence. Any further properties will need to be covered just as well as the first for building and contents, and if they are situated abroad or used for rental things can start to get very complex indeed.
As a consequence, the third reason HNWIs need special insurance is to save them a huge amount of time, hassle and worry. The affluent often find that regular banks fail to understand their lifestyle and needs, but wealth managers do with alacrity. Similarly, obtaining all the cover you need from an everyday insurer might be a real battle, whereas a private client provider will rapidly read the situation and ensure that nothing is omitted.
Aside from being a convenient way to arrange all the insurance cover you need, discussing your situation with a private client insurance adviser is also an excellent way to get a true picture of all the tangible assets you own. Working out your true net worth is a vital first step in achieving your wealth management goals.
To return to the parallel, one of the biggest draws to having a wealth manager is having an adviser (or team) dedicated to you and this the same in the private client insurance sphere. As with wealth management, personal service is at the forefront and you can expect a single person to deal with setting up your policies and dealing with any claims that should arise. And, in the same way that finding a wealth manager through our service obviates the need for endless research and legwork, so too a private client insurance adviser will take all the pressure off. Your assets may be diverse and include difficult-to-value items such as collectibles or classic cars, but your insurance adviser can scan the entire HNWI insurance market to put together the right package for you.
It’s difficult to overstate how much time and aggravation can be saved by opting for private client insurance over a patchwork of everyday policies that might not really meet your needs. Most of us dread “life admin” and so newcomers to private client insurance are delighted to find that many providers won’t require you to fill in any forms at all! Instead, an adviser can come to your home and get everything arranged through a nice conversation and then personally oversee any claims that might come to pass. Discretion, trust and continuity of service are key – as with having a personal wealth management adviser.
One of the main risks of trying to arrange all the insurance cover you need yourself without consulting a private client specialist is that it won’t be adequate for your needs. The in-depth discussions you get with a dedicated adviser will ensure that all your assets can be covered in one catch-all arrangement should you wish. Doing things this way can also deliver cost benefits, allowing you to tweak your cover to arrive at a premium you are happy with. You can also easily update your cover mid-way through the year to reflect new assets or changed circumstances far more easily because of that personal understanding laid down at the outset of the relationship.
Of course, one hopes never to have to trigger a claim, but it is worthwhile thinking about the difference in treatment you will get with a private client insurance provider too. The small print of a regular policy might deem High Street jewellery vouchers to be adequate recompense for a high-end piece, whereas a private client firm will have the contacts to find a replacement for you. Similarly, if there is a fire at home, they can send in restoration and recovery specialists to save what treasured assets they can. Most of all, getting your claims dealt with will not be the arduous, frustrating task it can so often be with regular providers.
As you will now appreciate, private client insurance holds out abundant rewards and reduces many risks that you may not have appreciated previously. It can also seriously streamline your lifestyle by removing a tedious task from your to-do list that you probably feel rolls around ever more quickly year after year. Going down the private client route is therefore a great investment into your preserving your peace of mind – and a massive time-saver too.
As the go-to wealth management platform for HNWIs, we have great connections across the private client sector and we can introduce you to leading insurance providers as well as the top wealth managers in the country. If you would like to explore what private client insurance could do to simplify your life and maximise your protection, please get in touch for an informal, no-obligation discussion.