Surrounded by personal lines property and casualty insurance,Main Street insurance agencies see the same type of risks day inand day out. The typical homeowner and auto insurance client is thebread and butter of personal lines agents and brokers. Homesranging in value from $150,000 to as high as $1 million make upmost, if not all, of a book of business. Auto policies to insurethe average family with one to four cars is pretty much thestandard. Insuring small boats and other vehicles, providingumbrella policies–it's all pretty standard. So how do agencies likethis handle a more affluent customer? When a client's home exceeds$1 million of replacement cost and individuals have much more tolose, agents need specialized policies to properly insure them.

Many personal lines insurance companies will not even coverhomes exceeding $1 million in replacement cost. And although somewill, they typically use the same forms and coverages used to covera $200,000 home, which is not always adequate for a high net worthaccount. In some cases there are additional endorsements availablethat would provide some further needed coverages, but thesepolicies are not truly meant to cover risks such as this.

Having a specialized product available to cater to these highnet worth individuals can be a valuable asset to personal linesagencies. Among the most well known and versatile insurance plansfor these clients are provided by Chartis Private Client Group(formerly AIG Private Client Group) and Chubb. However, there issome competition out there for these big players. For instance, arelatively new company from Florida called Privilege UnderwritersReciprocal Exchange (PURE) is making a big splash on the East Coastright now. PURE offers similar features to Chartis and Chubb, andis very open to coastal properties where others are morerestrictive in coastal areas.

So what is the difference between your average personal linespolicy and those created specially for high net worth individuals?First, there is the obvious: coverage limits can go much higher.Most homeowners' policies will only allow maximum coverage amountsup to $1 million or $2 million, if that. Specialized high net worthproducts will go much higher, sometimes up to $100 million or more.For auto insurance, there is no problem insuring a vehicle worthmore than $100,000, and owning many cars, both for personal use oras collector cars, can all be covered under the same programwithout the insured being penalized for owning many vehicles.Umbrella coverage limits can go as high as $100 million on a singlepolicy, while the normal market will only offer up to $5 million or$10 million.

High net worth programs also cover a wide range of otherpersonal property. Valuable collections including jewelry, fineart, wine and antiques can all be covered, either as scheduleditems or with a blanket policy. Although these types of policiescan be provided elsewhere, there are normally limits on how highthe value of these items can be on other policies. High net worthprograms can handle $500,000 of coverage or more for valuable itemsand collections. In addition, coverage is extended worldwide forthose who travel internationally, which is not always the case.

Other coverages available include yachts, airplanes andaviation, kidnap and ransom, employment practices and workerscompensation for private staff. Policies are extremelycomprehensive for such yacht policies, including fine art coveragefor items kept or transported on the yacht and additional livingexpenses, to name a few. Worldwide navigational limits, pollutionprotection and crew coverage are also standard for many high networth yacht policies. The aviation policies cover jets, helicoptersand other privately owned aircraft, along with hangars and privaterunways. Kidnap, ransom and extortion coverage can go as high as$50 million and includes consultation and training.

Obviously, virtually unlimited coverages exist for high networth individuals. However, it is uncommon for most agencies tocome across private jets and runways, enormous yachts, or customersseeking kidnap and ransom policies. But it may not be unusual tofind a client with a home worth as much as $10 million, with a fewvacation homes here and there and some high-valued cars andvaluable items.

In most cases, the place to start with a client in this economicrange is with the primary home. Creating a niche in this market canbe very lucrative. While companies such as Chartis and Chubb caterto any range of high net worth individuals, there are several othercompanies who are more focused on this $1 million to $10 millionrange, creating greater competition.

The advantage of going with a specialty market for high networth homes is the many perks and additional coverages included inthe homeowners' policy. Some of these include landscaping coverage,lock replacement, back-up of water and sewers up to the policylimits, and true guaranteed replacement cost. This includes uniqueand historic residences with no limit above the stated Coverage Aamount. These programs also include higher standard coverageamounts for fraud and identity theft protection, equipmentbreakdown, valuable items, loss assessment and ordinance and lawrequirements, with additional enhancements available in theseareas.

Along with increased coverages, high net worth insuranceprograms also help with managing the client's risks and lossprevention. On-site inspections go beyond simply evaluating thereplacement cost of the home, but also make recommendations to helpprotect the insured's assets and prevent possible losses. Chartiseven goes so far as to provide a wildfire protection unit and ahurricane protection unit. These are mobile units that will respondbefore a claim has even been filed to protect their insured's homesin the even of such a catastrophe.

In the event of a claim, the claims service of specialty highnet worth insurance programs are second to none. They willimmediately address damages and take measures to prevent furtherlosses to the insured.

Although having the right coverages and insurers available forpotential high net worth clients is important, a high level ofcustomer service is also critical to writing this kind of account.Individuals with so much to lose want to know that they can counton their agent, not only to find the best policies at the bestprices, but to be there to make sure their assets and families areproperly protected. The competition is definitely more aboutservice than simply about the best price, although price is alwaysa factor. Just because you own a $5 million home does not mean youwill pay anything for insurance; having options can be important aswell.

As an agent, getting to know these clients and creating a strongrelationship is imperative to writing and retaining business.Annual reviews go a long way toward keeping these accounts up todate and giving the client peace of mind. The companies can helpwith this as well, such as Chartis' detailed risk managementreports or PURE's annual membership reports their policyholders.Chartis, Chubb, PURE and others featuring such programs also makeit a point to develop strong relationships with the agencies thatrepresent them. In a marketplace like this, where relationships arecritical, strong partners such as these will help keep your highnet worth clients coming back year after year.