Navigating the insurance struggles of affluent clients
Katherine Frattarola of HUB Private Client delves into the unique insurance struggles high- and ultra-high-net-worth families face when trying to properly protect their assets.
While it may be easy to assume insurance woes only affect those with limited means, that is far from reality. The affluent, despite their significant financial resources, navigate a complicated landscape when it comes to insurance, and that has only been amplified by the far-reaching effects of an unpredictable climate.
For this episode of the Insurance Speak podcast, we were joined by Katherine Frattarola, executive vice president and leader of HUB’s Private Client practice, to delve into the unique struggles high- and ultra-high-net-worth families face when trying to make sure they are protected with the proper insurance coverage.
Frattarola said that while there are a number of issues affecting the availability of proper coverage for these wealthy clients, the most pressing is trying to navigate the hardened market.
“Whether you’re at one end of the spectrum and you’re a retiree looking to relocate to warmer climates or potentially the top of a mountain to enjoy nature’s bounty; or the other end of the spectrum and you’re a younger individual or family who’s gained traction and momentum in their career – maybe even sold the business,” she explained. “I think in both instances they’re finding it surprising that: Number one; it’s hard to find adequate insurance that solves for the complexity of their needs. And number two; they’re facing a lot of sticker shock.
“I think, as you consider retirees who are relocating from the Midwest to warmer climates in Florida. Just as an example, they’re now for the first time really evaluating the trade-off for a more favorable tax environment against the rising price of insurance.”
With these clients gravitating to areas more vulnerable to things like hurricanes, severe storms and wildfire, it places a huge burden on insurers. Some carriers have even chosen to exit or stop writing new business in certain markets where premiums have not been able to keep up with claims costs.
Frattarola said that one of the keys for affluent clients to effectively navigate this difficult insurance environment is to find a good, experienced risk advisor.
“I think that sometimes, folks wind up partnering with a risk advisor or broker just based on sort of natural impulse, or because it’s someone that they were introduced to, or maybe someone who lives around the corner from them and potentially doesn’t approach it with the same type of judicious thought that they should,” she advised. “And so my recommendation to your listeners would be to very carefully.”
To hear our entire conversation with Katherine Frattarola, executive vice president and leader of HUB Private Client, listen to the podcast above or subscribe to Insurance Speak on Spotify, Apple Music or Libsyn.