Risk Management

Identifying Insurance Red Flags


This guide for wealth management professionals can help identify circumstances that may put their clients at risk.

When was the last time your client’s personal insurance advisor completed a lifestyle and insurance portfolio review? 

If an in-depth review has not been conducted within the last three years, there is need for concern. Assets are acquired over time and risk appetites change. By not conducting annual reviews, gaps in coverage may not be revealed until a claim is denied.

Are your clients protected with enough personal excess liability insurance? 

Does their net worth exceed their liability coverage limits? If a lawsuit puts assets at risk, the last thing anyone wants to worry about is running out of insurance. AIG Private Client Group, a division of American International Group, Inc., can offer $100 million on a single policy to address claims of property damage and personal injury—including lawsuits filed by private staff, auto accidents with uninsured drivers and more.

Is their insurance program messy?

Successful individuals acquire assets over time, so it’s not uncommon to insure them in different ways. A summer residence, for example, may be with a different agent and carrier than the home in the suburbs. Fine art may be insured independently from cars. Whatever the combination, the result is fragmented, making insurance more difficult and expensive to manage. Don’t allow your clients to wait until claim time to find out what is—and is not—protected. A high net worth insurance provider is more likely to address the special circumstances that can come with success, or simply offer coverages that traditionally have been ignored in the mainstream marketplace.

Do they employ private staff? 

It’s not uncommon for nannies, housekeepers, private assistants, gardeners and others to take their employers to court. AIG Private Client Group’s employment practices liability insurance (EPLI) option responds to allegations of sexual harassment, wrongful termination, discrimination and more. In addition, we offer complimentary background checks on private staff1—helping ensure that only the most qualified and credible individuals are taking care of your clients’ loved ones and property.  

What sort of activities or hobbies do they enjoy? 

Whether it’s collecting cars, buying art or building a wine collection, AIG Private Client Group offers coverage to protect whatever passion your clients might have. As a complement to our private collections coverage, our art collection management experts are available to ensure that each collection is properly valued, insured and protected in the event of a disaster—or even an everyday mishap.

What is the makeup of the family? 

Family members may increase exposure to unidentified risks. For example, having a youthful driver may increase the need for higher liability limits. Or, young children in the family may encourage your clients to consider kidnap and ransom coverage. Your client may need an emergency preparedness plan for members of the family who are elderly or have special needs. AIG Private Client Group specialists can assist in preparing a plan.

Are your clients’ insurance policies in sync with their estate plans? 

Many wealthy people structure their property ownership using LLC’s, LLP’s and trusts. Not all insurance providers enable policies to reflect these alternate structures, which can result in diminished protection or complications at claim time.

Is the home properly insured and protected? 

If your clients had to rebuild their homes in today’s market, would they have enough homeowners’ insurance to sufficiently cover the expense? Many properties are insured based on values that are vastly underestimated—especially those that have undergone extensive home improvements and renovations. For those living in wildfire- or hurricane-prone areas, we provide complimentary consultations to understand preventive measures that can help prepare your clients for a catastrophe.2

Are your clients public figures or involved with charities/foundations? 

Media exposure and public awareness increase the need for comprehensive protection. We offer high limits of excess liability coverage to ensure that your clients’ assets are safeguarded against claims of personal injury or property damage, including libel and slander. Not-for-profit organizations typically operate on tight budgets and carry a minimal amount of liability insurance. If your clients or their spouses sit on the board of a not-for-profit organization,3 they can add up to $1 million of protection on top of existing board coverage.


1 Eligibility for complimentary preliminary background checks is determined based upon total account premium. However, all policyholders are eligibility for discounted pricing on preliminary background checks.

2 Eligibility requirements apply; enrollment required.

3 Qualifying organization is defined in the policy as any not-for-profit organization qualifying under Section 501(c) (3), (4) or (7) of the Internal Revenue Code, some exceptions apply.

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