Aon’s Private Risk Management (APRM) division notes that, as a result of the current recession, “the percentage of a family’s wealth invested in tangible assets, such as property, art and cars, has doubled on average over the last year.”
In response, APRM has launched an insurance risk auditing service to provide” impartial, professional advice to families, trustees and organizations that manage extensive private insurance programs with an annual premium over £40,000 [$66,000].”
Aon said its risk audit service is “a three-step process, which starts by reviewing the current exposures faced by the family in relation to the following areas:
— Tangible assets – property, fine art/jewellery, private aircraft/yachts
— Liabilities – public and property owners, employers, directors
— Personal well-being – travel/medical, kidnap and ransom, security, reputation.
Once this information has been collated and the exposures identified, it is cross-referenced with the current insurance program, to establish if the existing arrangements are:
— Appropriate for the type of exposures identified
— Without gaps or overlaps in cover
— Utilizing full market leverage
The findings of the audit are published in a report that is given to the family or its adviser during a closing consultation.
Charles Hamilton Stubber, managing director of Aon Private Risk Management, added: “Investment volatility has meant families are placing more emphasis on protecting their tangible assets. In turn, the role of the insurance broker has become key to insulating wealth by educating and boosting understanding on tackling risks. As confidence has been lost in some elements of the financial services, insurance brokers are in a strong position to respond and offer effective advice on protecting wealth.”
Harry Dawe-Lane, executive at Aon Private Risk Management, explained that over the last decade “the size and value of a family’s portfolio of insurable assets has significantly grown.” However, the increases in value may not be reflected by an increase in coverage. In addition he said there may be “gaps or duplications in cover. Policies may be placed with numerous insurers with no attention having been paid to premium saving opportunities by utilizing market leverage.”
He also warned that in some cases “wordings may be old fashioned and outdated or just inappropriate for the risk insured. We wanted to create a service at the forefront of the ultra high net worth market that would provide the necessary due diligence to eliminate these issues where possible.”
Source: Aon – www.aon.com
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