High net worth (HNW) individuals have unique risk profiles that can rival those of an organization. They may have valuable wine collections, irreplaceable jewelry, or multiple properties that require a complex strategy to prevent losses, thefts, or damages. Problems arising from natural disasters, employees, and security are also more likely to occur to HNW individuals without adequate protection. The following are some of the biggest threats facing HNW individuals.
- Cybersecurity. Connected devices are immensely convenient, and many high-end homes now boast smart technology. However, these amenities pose significant security risks that often go unaddressed until it’s too late. Hackers can access these devices with minimal effort. Once a cybercriminal breaks into one connected system, it’s not usually a challenge for them to access the rest of the house. For example, if the hacker takes over the security system, they can disengage alarms, access personal computers through virtual assistants like Amazon Alexa, and even plant false evidence or crimes.
- Physical security. HNW individuals and their families have atypical personal security needs. Untethering home security from connected devices and apps can reduce the likelihood of a cyberattack preceding a physical breach. Many local security companies specialize in decentralizing home protections like alarms, motion detectors, and video monitoring for HNW families. Local security firms also tend to respond faster to alerts than global organizations.
- Employee-related risks. HNW families often employ a range of employees, such as housekeepers, gardeners, or nannies. These individuals have access to their homes and sensitive information. HNW individuals need to operate like a business when interviewing, vetting, and hiring new employees. HNW families should also review their employees often, as trustworthiness can transform over time. They face other typical risks involved with maintaining a staff, such as employee injuries while on the clock or employment practices liability.
- Collectibles. HNW individuals often invest in collectibles, including wine, jewelry, art, and cars. Many consider the security needs to safeguard and display these pieces but tend to overlook several risks. For example, many collections require environmental controls for temperature. HNW individuals likely have a storage area to manage this but may not account for the logistics of moving pieces from one location to another. Investigating pieces before acquiring them is also essential to avoid legal hassles.
- Investments. HNW individuals have much greater concerns about taxes and managing their legacy. Poor record-keeping and bad investment decisions can result in significant tax penalties or tie up funds for years. Additionally, many HNW individuals lack adequate insurance to protect their investments.
Windermere Insurance Group understands that HNW individuals have complex risk profiles that require an equally sophisticated approach to protect against them. Contact us to discuss your insurance concerns and learn how we can insulate your family and your assets from unnecessary risk.