Because families with substantial assets overlook many savings opportunities, most agents say they can typically rebalance a family's personal insurance program to achieve more effective protection without significantly increasing premiums.
Independent insurance agents and brokers frequently find that families with substantial assets who insure their homes, autos, watercraft, and valuable collections with massmarket, heavily advertised carriers overpay for protection that still leaves them exposed to severe financial loss.
What are the specific risks, and why are these high net worth (HNW) families paying more than necessary? To find out, ACE Private Risk Services surveyed more than 600 independent insurance agents and brokers in 2010 and again in 2012 about their new HNW clients who were previously insured by a mass-market carrier. The survey asked if the clients were likely overinsuring or underinsuring for 21 types of coverage. It also asked about the likelihood of 11 types of savings opportunities being missed.
The agents' answers reveal that the problem of overpaying to be underinsured has worsened overall. On average, significantly more agents in 2012 than in 2010 said each type of coverage was likely underinsured and each savings opportunity was likely missed.
| Average Percent of Agents Saying: | 2012 | 2010 | Ppt. Chg. |
|---|---|---|---|
| Each coverage underinsured | 58.3% | 54.9% | + 3.4 |
| Each coverage overinsured | 7.5% | 7.8% | - 0.3 |
| Each savings opportunity missed | 27.7% | 22.1% | + 5.6 |
Having deductibles that were too low, failing to earn package discounts, and not getting premium credits for alarm systems and other loss prevention devices continued to top the list of missed savings opportunities. The likelihood of missing the last two increased significantly from 2010 to 2012.
|
Percentage of Agents Reporting Savings Opportunity Was Likely Missed
|
|||
|---|---|---|---|
| 2012 | 2010 | Ppt. Chg. | |
| Deductibles too low | 81% | 78% | + 3 |
| Package discounts | 62% | 55% | + 7 |
| Loss prevention credits | 50% | 36% | + 14 |
Coverage for umbrella liability, valuable collections, uninsured/underinsured liability, and rebuilding a damaged home remained the most likely underinsured risks.
|
Percentage of Agents Reporting Client Was Likely Underinsur
|
|||
|---|---|---|---|
| 2012 | 2010 | Ppt. Chg. | |
| Umbrella liability | 92% | 89% | + 3 |
| Valuable collections | 86% | 83% | + 3 |
| Un/underinsured liability | 86% | 82% | + 4 |
| Home structure | 83% | 86% | - 3 |
