Thompson Guards Wealth with Private Client Services
GIRARD, Ohio -- Say you own a house in Florida where you spend the winter. In summer, you prefer the breezes off the Atlantic Ocean in a second beach house you purchased in North Carolina or New England. Meanwhile, there’s the two-story dwelling you own in your hometown where you and your family return for the holidays.
Over the course of your career, you’ve acquired expensive cars, jewelry, fine art and other assets with a high value.
Those with high net worth often find themselves facing complex issues related to managing and protecting the assets they’ve accumulated. However, even the wealthy fail to grasp their level of exposure, and how existing assets – as well as future income – are at risk without the proper insurance coverage.
“High net worth assets are often at risk,” says Andrew Thompson, vice president of Thompson Private Client Services, a division of Thompson Insurance Group, Girard. “They’re a larger target for lawsuits, and high-end clients have exposures that the standard insured may not have.”
Thompson Private Client Services specializes in providing insurance coverage for high net worth individuals. In most cases, traditional insurance carriers have limits on how much they’ll insure, forcing clients to contract with more than one company to cover the balance of their net worth and assets.
“Some need protection of up to $100 million,” Thompson says. “We can cover all of that. Our biggest goal is to package everything together.”
Standard umbrella liability policies, for example, are capped at roughly $2 million, Thompson says. That means many high-income earners are woefully underinsured or are paying more to cover liability gaps through more than one agency.
Thompson says many high net worth individuals fail to appreciate the risks associated with their high-value assets.
Equity in houses, trust accounts, savings accounts – even future income – all could be lost as a result of a mistake. An accident in which a member of a wealthy family was at fault that caused harm or death to another person, for example, could cost that family everything if they’re not properly insured.
“When it comes to physical and property loss, you can always put a dollar amount on that,” Thompson says. “Where you can’t put a dollar amount on is the liability. It’s up to a judge and jury to decide that.”
However, many whose earnings put them in the highest tax bracket pay too much for too little coverage, observes Bob Courtemanche, chairman of ACE Private Risk Services, a high net worth insurance company based in Philadelphia and one of several private client firms Thompson uses to underwrite coverage.
“There are a lot who are overpaying to be underinsured,” he observes.
ACE entered the private client market in 2008 and was recognized this year as the best high net worth insurance company by Private Asset Management, a trade journal.
Affordable umbrella liability policies as well as packaged property programs offered through ACE help those clients who own more than one home and a high net value of the contents of those homes.
In addition to ACE, Thompson Private Client Services works with PURE Insurance and Crestbrook Insurance, a subsidiary of Nationwide, to provide coverage for its clients.
Thompson Group began its private client division from scratch in 2010, says Jeffrey Thompson, vice president of sales in the private client group. “We’ve doubled every year,” he says. “There are a lot of high net worth clients in the Mahoning Valley.”
More important, Jeffrey Thompson says, the company takes the time and effort to carefully evaluate the client’s assets to determine the level of coverage needed.
“We get into it and see what they have,” Thompson says. “Often, they’re actually quite surprised at the stuff that wasn’t covered once we get there and go over everything with them.”
The private client division is licensed in 48 states, he reports, but some of its clients have assets in other countries that Thompson’s plans protect. “We can handle it all over the world right from here,” he says.
Technology has made it more efficient to communicate with clients across the country, he relates, enabling the company to quickly respond to a client’s concerns and needs.
“It’s a complex and misunderstood field,” says Hans Mautner, former senior officer and board member of Simon Property Group and a client of Thompson. “They’ve been very good and diligent independent agents.”
Mautner owns residences in Rhode Island, Florida and Paris, and the policy he holds with Thompson provides a single point of contact for insurance. “It makes life simple for me,” he says.
Other high net worth clients see value in comprehensive insurance products under Thompson.
“They’ve really looked out for my interest,” says Layton McCown, retired chief financial officer for ForestCity Group’s commercial division. McCown, faced with insuring multiple houses, was searching for a plan that would place all of the assets into a single policy.
“It was hard to find anyone to insure multiple residences,” he says, especially his house in Florida where it is difficult to secure coverage in an area visited annually by hurricanes.
“I was looking for someone to provide it all. And that’s one of the things they did,” he says of Thompson. “If it wasn’t for them, I’d be managing insurance through different brokers throughout the country.”
Moreover, the company provided vital insight into the amount of coverage he needed. “They were great at giving me advice on what I need in this litigious environment,” McCown says.
Today, Thompson Insurance Group employs 26 across its divisions, up from 13 in 2009, Andrew Thompson reports, and its private client services is a fast-growing but underserved segment of the market.
“High net worth insurance isn’t commonly known, and high net worth individuals sometimes think a standard insurance company is sufficient,” he says, when they’re not.
That forces companies such as the Thompson Insurance Group to become innovative on how to approach and deliver its products the very personalized market of high net worth insurance.
“It’s our job to look at everything differently,” Jeffrey Thompson says. “A lot of people who need this program don’t know what they’re missing by not having it.”
Pictured: Jeffrey and Andrew Thompson work with high net worth clients through the Thompson Private Client Services division of their company, Thompson Insurance Group, Girard.
Copyright 2014 The Business Journal, Youngstown, Ohio.
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