Protecting Your Estate For The Future
Owning an estate brings with it responsibilities far greater than those of the ordinary householder. There comes also, a duty of care to maintain and retain the asset for the future, for the heritage value and inheritance aspect.
Here, Amanda Harman, from Aon’s Estates team, gives you ten things to consider when addressing this aspect of ownership.
1. Protect more than the bricks and mortar
Your first action should be to think about protection, not only of the estate buildings and assets but its greatest asset, you. When you die, will inheritance and capital gains tax take all the joy out of your heirs’ legacy? Speak to a financial adviser and get expert advice on how to arrange your affairs so this impacts as little as possible.
2. Speak to risk management experts
You will be happy to consult your land agent, accountant, solicitor and, no doubt, consider these professionals to be part of your Estate’s ‘team’. Estates insurance can be complex and there are many different aspects to factor in when deciding on the level of cover you may need - you cannot buy Estate Insurance off the shelf. Without the guidance of a qualified expert, who understands insurance for estates, you may miss vital details, leaving you potentially under-insured or at risk from legal action. Remember your insurance broker should also be seen as a professional member of your team of experts.
3. Covering all the bases
Estates insurance policies will, of course, cover the house and the contents for ‘all risks’. This includes perils such as fire, storm, flood and accidental damage. However, take into account not just what you own but also what you do with it. You may let all the land, making you a landlord, or you may run all the activities yourself. These different approaches mean you need different insurances.
Check what your obligation is as a landlord, owner or proprietor. An employee for insurance purposes could be entirely different from your perception. There are legal obligations which fall upon you as a property owner or proprietor of, say, a shoot. These also need to be taken into account.
If you have income from your Estate, consider how much you rely on that income. If there is any one source of income which is vital and which would have a serious effect if it were curtailed, you need to consider insuring this, unless you can afford to bear the cost of this loss yourself.
6. Valuable Assets
If you choose to insure your assets, you are well-advised to ensure they are covered to their correct value. It is recommended that you have buildings revalued for insurance purposes every 5 years and contents more frequently (3-5 years).
If you have a collection, anything from fine art, wine, coins, stamps and books, you need to ensure your insurance broker has expertise in this area so they are able to advise on the correct way to insure and can place the cover with the most appropriate insurer.
There are so many facets to estates insurance, it is important that your insurance broker understands the estate, its activities and what is important to you, the owner and custodian. Make sure you meet your broker and are confident in their knowledge and ability to correctly and effectively arrange insurance for your assets.
8. Commercial Covers
If your Estate is run on commercial grounds, do not allow yourself to be sold a domestic-only policy. This will not cover the commercial requirements of your Estate, in particular in respect of some of the vital covers such as loss of income and legal expenses.
9. Ask questions of your broker
It is good practice to establish the financial strength of the companies you are dealing with. You should also know how long the company has been established and who owns them. It may be important to you to deal with a company based in the UK with access to other insurance markets. Ask all the questions you need to in order to reassure yourself the company with whom you are dealing is well-established and complies with the correct regulations.
10. Trusted advisor
Finally, and most importantly, your insurance broker should be a trusted part of your Estates Protection team. There should be a good mutual understanding between all parties which transcends mere empathy and rapport to complete trust in your insurance adviser. This allows you to have confidence in them and speak to them prior to making significant changes to the Estates activity so you can ascertain the impacts of your proposal and the resulting insurance requirements.
It is crucial that you have a good understanding of what is required to protect your Estate but you do not need to be an expert yourself. You would, for example, consult an agronomist for your land use, an accountant for your financial affairs and a solicitor for your legal affairs so utilise the expertise of your insurance broker and keep yourself and your assets safe.
For further information or to discuss a query please contact Amanda Harman on +44 (0)1252 767349 or firstname.lastname@example.org
Whilst care has been taken in the production of this article and the information contained within it 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 article or any part of it 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 23.06.14.