With great wealth comes great responsibility…and potential liability.
A recent survey conducted by Chubb Personal Risk Services concluded that many ultra-high-net-worth (UHNW) individuals overpay for protection that still leaves them vulnerable to significant financial loss.
Any asset that can be damaged or destroyed needs to be insured, and when it comes to this affluent demographic, many areas of potential liability are lurking out of plain sight. UHNW families are especially susceptible to having excess assets than aren’t fully covered by a standard insurance strategy.
As UHNW individuals continue to accumulate wealth, it’s crucial to have the proper insurance policies in place to avoid significant financial loss.
There are three policies your UHNW clients should consider in particular: aircraft insurance, domestic employee insurance and wine collection insurance. Here is why each is valuable and pays for itself in peace of mind year-over-year:
1. Aircraft Insurance
While your clients are globetrotting for both business and pleasure, they are sure to protect themselves and their belongings. However, for the ultra-wealthy who have fractional ownership of a private fleet or who regularly charter flights, there is excess risk, which is where aircraft insurance comes into play.
Also known as aviation insurance, the coverage extends to damages to the aircraft itself, as well as the liabilities associated with operating in flight. These policies can save your client’s assets in the event of many unexpected scenarios.
Most personal umbrella insurance policies exclude liability arising from aircraft-related incidents. If your client owns a fractional share of an aircraft or charters regularly, an aircraft-specific policy is an absolute must. In addition to providing an individual limit of liability, this policy offers defense coverage that could save the client millions of dollars.
2. Domestic employee insurance
Many UHNW clients may hire domestic workers to support their family, primary residence and vacation properties. The idea of domestic employees can sometimes be confusing, but the IRS defines them as babysitters, caretakers, housekeepers, drivers, health aides, private nurses and landscapers.