Unreported Lifestyles - Associated Risks
Individuals with significant wealth tend to have distinct lifestyles, such as using private jets, participating in equestrian activities, or traveling luxuriously around the globe. These lifestyles come with concealed risks that insurers may deny claims for if not disclosed when purchasing a policy. For instance, if an injury arises from horse riding and the insurer was not informed about routine equestrian practice, the medical claim may be denied. To prevent such issues, be proactive in sharing thorough details about your lifestyle when acquiring policies, even regarding seemingly unimportant aspects, and inform insurers of any changes.
Incorrect Valuation in Luxury Asset Insurance
When it comes to insuring high-value items like unique watches or exquisite art, a frequent reason for claim denials is incorrect valuation. If you've insured an artwork at the original purchase price but its value has dramatically increased, the insurer may only compensate you for the amount insured initially, rather than its new market value. To address this issue, arrange for yearly valuations by specialized appraisers (such as those focusing on art), and update your policy to reflect these new assessments to ensure your claims match the current value of your assets.
Exclusion of “Specialized Services” in Premium Health Insurance
Luxury health insurance plans often do not cover “specialized services” such as concierge medicine, cutting-edge gene therapies, or medical trips to exclusive facilities. Many policyholders mistakenly believe these are included and later encounter denials. To avoid this, carefully examine the policy details before purchase to find services that are not included, and negotiate for potential add-ons that meet essential needs (for example, a rider for tailored cancer treatments) directly with your insurer.
Delayed Reporting of High-Value Losses
Reporting losses for high-value possessions—such as classic cars or yachts—after a delay, even by a few days, can result in denials. Insurers claim that a late notice restricts their ability to investigate properly (like establishing the cause of damage to a yacht). To tackle this, save your insurer's emergency contact on your phone, and inform them of any loss right away, even with incomplete information. Additionally, provide a written account within 48 hours.
Insufficient Documentation for Custom Policies
Customized insurance plans, such as private home coverage inclusive of art collections, necessitate specific documents—like maintenance logs for vintage furniture or provenance for collectible wines. Missing any critical documents (like neglecting to submit an annual yacht inspection) could lead to a claim being invalidated. Keep digital records of all related documents in a secure online folder and make it a point to update your insurer every three months with new information (such as receipts for new art acquisitions).
Conflicts Due to Overlapping Coverage
Wealthy individuals often hold various insurance policies (such as two premium travel insurances). Insurers may refuse claims citing “overlapping coverage,” claiming it complicates the determination of responsibilities. To rectify this, collaborate with a specialized insurance advisor to review all policies, identify any overlaps, and clarify which insurer manages specific risks (for example, one for medical travel and another for lost luxury items).
