Carriers pursuing ultra-high-value clients must be willing to enhance customer service and customize workflows to fulfill the unique needs of this complex segment, according to a new brief from Novarica.
High-net-worth individuals (those with $1 million or more of investible assets) buy personal lines products the way most of us do, Novarica says, contrasting that group with those in the ultra-high-net-worth category (more than $50 million in investible assets), who require more customized coverage solutions. Their money is often managed by a family office that provides advanced financial planning, estate planning, and management of assets and people working for the family (including pilots, gardeners, house support staff, drivers, etc.).
Ultra-high-net-worth customers require a combination of traditional personal lines and commercial lines coverages, including private aviation; employment practices liability; domestic employee workers comp; recreational vehicle and ATV; inland marine for boats and yachts; natural catastrophe protection; jewelry, art and collections; personal umbrella; automobile and fleet; homeowners and condos; and classic car coverage.
These clients are often underinsured, Novarica says, as they generally don’t adjust their coverage when asset values or personal liability risks increase.
Rather than selling on price, Novarica says the true differentiator for carriers in this market is the level of service they offer. For instance, the emergence of connected devices has created many opportunities for enhanced services, including:
- Advanced thermal imaging technology that can identify fire hazards and moisture issues in homes to protect artwork and valuables.
- Leak defense system that can automatically detect leaks and shut off the water supply in homes.
Highlighting the importance of customer service, Novarica notes that for the ultra-high-net-worth market, products are sold utilizing relationships—either referrals from family or friends or from professional relationships like bankers and lawyers.
This market segment may also require different workflows, Novarica says. Ultra-high-value clients often have dedicated claims handlers, with a concierge/relationship management function established. Carriers should also be prepared to design custom workflows based on a starting template and enhanced to reflect specific circumstances of the client and family.
For more information, see “Key Technology Issues and Trends in High-Net-Worth Personal Lines.”