Lawsuits happen all the time. Your medical, legal, financial and other high-net-worth clients understand this business probability, and typically have business insurance to protect their practices against these types of risks. However, business insurance won’t be of any use in the event of a personal lawsuit, and typical personal liability insurance policies have relatively low limits — putting your clients’ personal assets at risk.

In today’s litigious society, high-net-worth clients and their related professional associations offer a potentially potent one-two punch to help grow your business. The sale is simple: Even a dismissed lawsuit can cost hundreds of thousands of dollars in legal fees and lost work time, so full asset protection is crucial. High-limit personal umbrella insurance helps provide that protection.

Clients need high-limit personal umbrella insurance, in part, because personal insurance limits are typically low. Automobile liability insurance, for instance, usually pays only $300,000 or less for liability damages, while the limits of home insurance are often as low as $100,000. These limits will not suffice in a world where financial damages continue to grow.

Discussions with your clients should address the need for complete personal insurance coverage, of which high-limit liability coverage is an important aspect. High-net-worth individuals need to understand that business insurance will not protect them in the event of personal lawsuits, and that their real or perceived high net-worth makes them a target for the less scrupulous, who might see them as an easy payday.

Talking about this coverage with physicians, attorneys and other affluent clients and prospects can lead to uncovering other unmet insurance needs.

 

An important addition to a group’s benefits menu

Affinity marketing through these associations has comprised many a broker’s insurance business for years. Associations not only offer members basic insurance to cover various business risks, but also offer an array of personal insurance, including health, auto and basic liability insurance. For those organizations that cater to high-net-worth professionals, high-limit personal umbrella coverage is a natural addition to their benefits menu.

Offering this coverage not only generates revenue for associations, but can also help to attract new members and retain current dues-payers. The association and affinity market is worth more than $15 billion, and studies show that about one-third of members want to purchase insurance through their groups, making it worth the effort to reach out to them to talk about this important coverage addition.

Whether you are working with employers to offer this coverage or through professional organizations, outsized lawsuits potentially exceed available personal insurance limits, which can threaten personal assets. Recommending a high-value, low-cost coverage like high-limit personal umbrella insurance can help you protect your clients financially, while opening the door to increased business for your practice.

Fleet is president of AmWINS Group Benefits, a wholesale broker of comprehensive group insurance programs and administrative services. Reach him atasksam@amwins.com.

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