Why “Affluent” Consumers Need an Independent Insurance Agency

Firmly wedged between high-net-worth individuals and the mass market lies the affluent market.  There are a lot of misnomers about people labeled “affluent.” For some, it means a multimillion-dollar net worth and a palatial mansion and covers a broad spectrum of clients. We’re talking basically about the upper-middle class. 

They represent our community’s established professionals and business owners. They often drive luxury autos (especially in Michigan) and likely own specialty vehicles, such as boats or motorhomes. But one thing is clear — because of their assets and income, they need high limits of liability and an umbrella policy.

With home values starting around $500,000, these customers may qualify for private client coverage, but they’re not all willing to pay the price for white-glove service and have little need for a bottle-by-bottle wine schedule.

“You could break it down to people who have significant assets, need a specialized insurance program.  It’s about the coverage and personalized service.  We develop the best plan for their assets and they hold us accountable to make sure we give them the service they expect and deserve. That, of course, is what we’re best at,” says Curt Rager, CEO and President of Autumn Insurance and Benefits.  

What affluent customers do need is a risk advisor, an independent agent like those at Autumn Insurance who understand how to ensure they are protected using their superpowers of ease, choice and advice. They also need an insurance carrier that has both the breadth of products and the depth of coverage to give them peace of mind.

Many affluent customers are insured by captive carriers, not realizing that the lower internal limits of their current policies leave them inadequately protected. This is a rich (pun intended) opportunity for Autumn to educate the community.

According to Safeco, one one of Autumn Insurance’s independent partners, when quoting affluent customers, here are five key coverages that need to be offered:

1) Extended dwelling coverage. This is a must. As the pandemic is showing, the cost to rebuild a home can vary wildly and without warning. Shortages of materials, labor and more mean that 25% or even 50% may not be enough coverage to rebuild a home, especially when you consider luxury finishes, such as granite countertops and solid wood doors. 

2) Replacement cost coverage. This needs to be considered on everything possible, from personal property to their autos, boats and RVs. As an affluent consumer, you’re interested in protecting the things you’ve worked so hard for and because an independent insurance agency offers policies with replacement costs, it shows that we recognize the importance.

3) Original equipment manufacturer (OEM) parts and glass. People who drive a Porsche, Land Rover, or similar luxury vehicles generally want repairs to include genuine OEM parts, including an OEM windshield. However, few carriers outside the private client market offer OEM glass coverage.

4) Worldwide protection. Many affluent consumers travel extensively. Ensuring they have protection no matter where they wander will offer valuable peace of mind, including everything from worldwide vehicle rental coverage to the worldwide liability protection of an umbrella policy.

5) a valid umbrella policy. The assets and income of the affluent make them targets for lawsuits. Additionally, their future income needs protection. Offer an umbrella policy that covers risks such as electronic libel, directors & officers activities, rented watercraft and the cost of legal defense outside the limit of liability.

While some carriers have fled this market, independent insurance agencies like Autumn Insurance continue to be bullish on the affluent market. We offer an entire suite of products designed for affluent customers.  Call us today for a no-obligation consultation at 248-478-1177.

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