Buying insurance direct is easy. Buying the right insurance, however, can be very difficult indeed and getting it wrong often proves costly. We asked Aon Private Clients Account Director, Alexandra Richards, to explain why it pays to use a broker.
You can approach your broker with all of your insurance queries. Brokers who specialise in high net-worth insurance will understand the type of lifestyle you lead and have experience in arranging insurance to meet the individual needs that you and your family may have.
You will be allocated a dedicated Client Manager as soon as you engage a broker. This person will create a bespoke policy based on an in-depth telephone interview and, in some cases, a visit to the risk address.
Insurance brokers set out to create a holistic approach for their clients. This often means creating a single, portfolio policy that incorporates home, travel and motor insurance with one renewal date.
A broker will take the onus off of you and will search the market on your behalf for the most appropriate insurance cover for you and your assets. The broker will collate a number of options and will explain the cover type and small print of each option to help you choose cover which meets your insurance needs.
Brokers have access to specialist underwriters and syndicates which often aren’t accessible to the general public. If you have a specialist collection of art or jewellery then it is crucial that you have cover from an underwriter who understands the intricacies of the collection.
If you have a very rare or unusual collection or piece of art and your broker is Lloyds approved then they will have access to a number of specialist Lloyds syndicates.
Insurance documents are complicated and it is easy to overlook the small print. A broker is an insurance specialist; alerting clients to vital details such as exclusions, and policy excesses is what they do.
According to the ABI’s guide ‘Is your Home Underinsured’, research shows that one in five British households do not have a sufficient cover. It’s a worrying statistic that proves just how difficult it can be to accurately assess the true value of your home and its contents. Below are some common valuation pitfalls that a broker would help you avoid.
Buildings insurance: If the re-build cost of your home is over about £500,000 then you may well find that a standard buildings insurance policy is inadequate. Market value and re-build value are very different things and it is perfectly possible for the latter to exceed the former. Factors such as Listed Buildings status, period features, expensive materials, local building costs and access can all add to the re-build costs.
Contents insurance: Many people are surprised to find just how much it would cost to replace everything in their home. When you engage a broker, s/he will help to ensure you have thought about everything from the contents of your wardrobe to the value of specific items to ensure that you have adequate cover. Your broker will also advise on whether or not any of your possessions require additional protection such as Collections, Fine Art and Antiques cover.
Unlimited General Contents insurance: Contrary to popular belief, this type of cover does not mean that you don’t need to assess the value of your home’s contents because your insurance company will just send out a big cheque in the event of a loss. They won’t. If the worst does happen, the onus will be on you to prove what you had and what it was worth – which is not an easy task if it’s all gone up in smoke. A broker would help you to assess and document the value of your possessions at the outset.
Many people simply tick the boxes when it comes to renewing their policy each year, but changes such as building works, acquisitions or dispositions may well affect the value of the risk. If you have gone through a broker, then your Client Manager will carry out a re-broking exercise before renewing the policy, asking questions about possible changes to your circumstances to ensure that the valuations are still accurate and you have the relevant level of cover.
Making a claim can be a stressful business. If you’ve gone through a broker, then you have someone working on your behalf to achieve the best possible outcome.
In the event of a loss, you will also be asked to produce inventories and paperwork proving the value of what you are claiming against. A broker would not only have helped you ensure that this paperwork existed and was up to date before the loss but can also keep electronic copies if you wish.
A broker will work as part of your existing team in a similar way as your Land Agent or Accountant does. If you use a broker then they will be happy to work directly with you or a professional intermediary.
Making sure that you have the right type and level of insurance is crucial to ensure that you and your family have the protection you require. Finding the right insurance can be time consuming and confusing but by working with a broker you can rely on them to help you ensure that you are adequately protected.
Care has been taken in compiling the information contained within this article, this has been obtained from sources that Aon UK Limited believes to be reliable. Aon UK Limited does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose of the content, including links and the content of any site within the article, and can accept no liability for any loss incurred in any way whatsoever by any person who may rely on it. In any case any recipient shall be entirely responsible for the use to which it puts this article.
This article has been compiled using information available to us up to 09.04.15.
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