Insurers love jargon and call insurance that protects the assets of wealthy individuals high net worth (HNW) insurance. It is non-standard, tailored cover to suit your needs. It has better terms, fewer exclusions and usually comes with some risk management help too. Because you’re worth it.
1. What is HNW insurance?
High net worth (HNW) insurance is the kind of cover we would all like to have but most cannot afford. So instead of packaged-up standardised policies with exclusions and limits that compete only on price, it is individually put together to meet your needs.
And it is backed by far higher levels of service, including faster and more comprehensive claims.
Here’s just one example. In April 2010, the eruptions of Eyjafjallajökull volcano in Iceland caused an ash cloud that made flying dangerous. Flights were grounded across Europe, causing travel chaos.
Every single travel insurer lined up with a magnifying glass to show that the small print in their policy meant they did not have to pay out for cancelled holidays.
Every insurer, that was, except HNW insurer Hiscox. It announced that, even though its policy wording probably did exclude these claims, its customers expected better of it and it would pay in full.
It was genius. All other insurers were later forced to pay out by the Financial Ombudsman, and some even fought that in court. Hiscox has a different attitude.
Peter Burkert, of insurance broker Lark, says: “HNW insurance means less hassle, less onerous, extended cover, with the availability to buy additional products, providing a portfolio mentality.”
2. How will I know if I am high net worth?
It’s less a measure of your wealth or the kind of assets you need protecting, than of your attitude.
Barry O’Neil, managing director of Home & Legacy, the HNW offshoot of Allianz, says: “There tends to be a trigger of some sort that means a standard home or motor insurance policy simply does not meet the needs of affluent clients.
“This trigger can be the rebuild value or size of the property – over £1m or more than six bedrooms, or more than £200,000 worth of general contents.
“If the client has high-value items such as jewellery or collections, this would be another trigger – for example, a £50,000 Rolex would be beyond the range of most standard home insurance policies. A motor insurance policy may need to cater for multiple cars and several drivers, and may include high-value and high-performance cars,” he says.
3. How do I buy HNW insurance?
You won’t buy HNW insurance online and certainly not on a price comparison site. You need to speak to an insurance broker. You’ll meet face to face and they will visit your home and probably carry out a proper survey to make sure everything is covered and everything is as secure at it can be.