When the world's your home, people and their things are constantly on the move. With houses spread across the United States and various European, Asia Pacific or Latin American hot spots, and pastimes that range from art auctions to car racing, high-net-worth individuals are often jetting from here to there, their pricey valuables in tow.
These multinational excursions foster a unique range of travel-related risks. For instance, it is not unusual for more adventurous wanderers to travel to exotic locales on vacation, where the medical facilities may be substandard—a dire problem if the traveler is injured or becomes ill.
When wealthy people take a trip abroad, often their jewelry, furs, designer clothing, art work and even their fine automobiles, travel along with them. Transporting rare, vintage roadsters to drive in rallies like the Mille Miglia or to display at auctions like the Concours d'Elegance are routine for their owners. And it's not uncommon for affluent individuals to bring along their nannies, chefs and other household staff on their peripatetic journeys.
Much less thought may be given to the risks presented by these expeditions, not to mention the complicated differences in insurance policies transferring the related financial exposures. These thoughts were in clear focus during a conversation I enjoyed recently with Sharyn Rouse, head of the Private Client practice at insurance broker Aon Risk Solutions, in Melbourne, Australia.
Sharyn has long attended the needs of the firm's wealthier clientele, who by her appraisal appear constantly on the go. "If they're based here in Melbourne, they've got houses and apartments all over the world—in New York, Hawaii, London, Paris and also Switzerland," she explains. "Our job is to manage their risks as they go from one place to the next."
Nuanced Financial Exposures
When the "next" place is outside the person's country of residence, insurance policies underwritten and purchased domestically may fail to provide full coverage, if any at all. Many nations require the purchase of locally admitted coverage—insurance sold by insurers licensed to do business in the country.
Other travel-related coverage complexities include whether or not a personal insurance policy absorbs the loss, damage or theft of valuable personal items like jewelry. If the jewelry is actually worn by the owner en route, generally if it is lost or stolen it will be covered. "But if the owner ships the jewelry to a foreign location or packs the jewelry in luggage and it disappears in transit, not all insurance policies will remunerate the owner for the loss," Sharyn notes.
If she detects wording in an insurance policy that may edge the client out of coverage, she will work with the insurance provider to address this void. "Many policies require that jewelry be under personal supervision," Sharyn explains. "But what if the client falls asleep on the plane or the jewelry is in hand luggage in the overhead compartment—does that constitute personal supervision for coverage purposes?"
Transporting fine automobiles to car rallies creates other insurance considerations. Two separate policies are required—one covering the potential damage and loss of the vehicle en route to the destination, and another addressing the property damage and bodily injury liabilities from driving the automobile abroad.
