Not Your Average Sales Pitch

"It takes a pretty talented individual to do it," says Richard Kerr, president & CEO of electronic insurance exchange MarketScout, which pairs independent agents with HNW clientele.

HNW producers need to remember that their clients have enough money to buy whatever they want, and most likely will—so they have to keep their eyes and ears open for changes in the client's lifestyle.

Carriers, for their part, must make sure their agents and brokers are comfortable dealing with HNW individuals: "Some people who make $60,000 a year don't like people who make $6 million," says Kerr.

Even if a Personal Lines producer has the skills, becoming a high-net-worth producer is not something that can be done overnight, says Charlotte Edmonston, national niche managing director for Arthur J. Gallagher: "You start small and work your way up. It's a whole different kind of animal."

 The HNW producer is more of a risk manager and has to grow into that role, she says: "When I first started doing High Net Worth there were only a couple of carriers that did it." As the first HNW Personal Lines producer in Louisiana, Edmonston spoke to other interested candidates throughout the state.

"There was no model," she recalls. "Now everybody wants to be a private-client producer, and a good one is hard to find—and expensive. You have to really vet that person with the carriers."

Accountability is important, and privacy is "huge," she adds. "You'd better know what you're doing, because they've got some extreme exposures."

The HNW market is more relationship-driven, so networking with clients is completely different than the standard market, she points out. Previously, when Edmonston was selling standard lines, she would sit down to talk with lawyers or real estate agents. "Now it's a financial planner, a wealth manager, a family office manager, a business manager," she says. "It's a different kind of network, and they have extremely high expectations."

Chubb Personal Insurance pairs its independent agents with financial planners, wealth managers and third-party administrators because those are the professionals that HNW consumers normally trust for insurance advice even though they may not necessarily know a thing about Property/Casualty insurance, says U.S. Marketing Manager Jim Fiske. This way, the insurance producers and wealth managers are working on the same page.

The pairings also help Chubb's independent agents realize that they're providing products and services that are a step above to these VIP customers, Fiske says: "Consumers don't turn to their home and auto agent for advice on finance."

A VIP customer is more likely to have unusual needs "that the rest of humanity might not," he says, such as employ domestic employees like a nanny, a housekeeper or an au pair, or sit on the board of a not-for-profit organization. "That increases their level of exposure," Fiske adds.

Edmonston has several HNW clients that serve on nonprofit boards and also host charity events in their homes. The HNW producer usually provides coverage for the board exposure, the charity events, and any damages that may occur because of the event.

As more agents are seeing value in servicing the HNW market they want to get into it, says Stan Sanchez, a principal at Edgewood Partners Insurance Center (EPIC) in San Francisco. He's been working with HNW clients for about seven years.

The problem is finding the talent who can sell HNW products and be successful in it, he says: "Premiums are pretty low, and it takes time to build up a book of business."

HNW producers also need to be on their toes when the client needs something. "If they call, they want to hear back from you within 30 minutes to an hour. Response time is crucial," says Sanchez. "They're also relatively low-maintenance, good clients to have. But where there's a service issue, they expect the highest level of service."

Even risk managers in the HNW space need to do more, know more, be more. Gary Raphael, senior vice president of ACE's Risk Consulting Division, says the company's Risk Mitigation Services requires its members to pursue an increasingly wide-ranging level of expertise in assessing HNW clients' homes and properties.

That service includes domestic counsel and background screening for household employees and contractors; collection management; assessing the insured's potential for extortion, identity theft, and kidnapping; and weighing the possibility of natural catastrophes, like hurricanes and wildfires.

"We have to have savvier, more broad-based skills sets for our internal teams, and cultivate an awareness of a whole range of issues," says Raphael. "You walk into a house and you're part architect, part interior designer, part security consultant, part investigator. You're wearing a variety of hats."