Claudia Buck: Do you want or need “concierge-style” insurance?
06/01/2014 12:00 AM
05/30/2014 8:59 PM
So a giant tree limb falls in your driveway, crunching your sports car. Or you’re away on vacation and the upstairs plumbing springs a leak, flooding your downstairs. Or a wildfire erupts in Tahoe, causing major damage to your vacation cabin.
Who are you gonna call? Your insurance agent, of course.
Traditional insurance companies will handle your claims for loss and damages covered by your policy. But for those seeking a little extra care and attention in the process, there’s a niche part of the industry known as “concierge insurance.” Think of it as insurance with perks.
Concierge-style insurance offers the same kind of traditional coverage for homes, vehicles, jewelry, artwork, etc., but with special services typically geared toward busy, higher-income consumers. Like a hotel concierge who makes life easier for you, a concierge-type insurance provider gives you someone to handle the cumbersome, time-consuming tasks and details that go along with filing insurance claims, as well as preventing future losses.
“We’re seeing more of this,” said Jeanne Salvatore, spokeswoman for the Insurance Information Institute in New York. She said the “added-value services” are a way for insurance companies to retain or attract new policyholders. “It’s definitely something consumers should take a look at.”
Concierge policies aren’t new, but they vary according to what services they offer and at what price. Companies like Travelers, CHUBB, Fireman’s Fund and others offer some premium services, which are often touted as making the claims process easier.
One of the newest concierge-type insurance entrants in California is PURE, the acronym for Privilege Underwriters Reciprocal Exchange, a White Plains, N.Y.-based insurance company. Founded by a group of longtime global insurance executives in 2007, it’s now licensed in every state except Idaho. Last week, PURE opened its first California office, on Post Street in San Francisco.
In the last eight years, the company says it has seen 40 percent annual growth, with about 30,000 member families nationwide.
PURE is aimed at the “high-net-worth” individual who owns several homes, multiple vehicles and valuables or family heirlooms, whether it’s artwork, a wine collection or specialty collectibles. The company insists that its target group goes beyond the super-rich, however.
“It isn’t only for a few happy billionaires in Silicon Valley,” said Ross Buchmueller, president and CEO. “It’s for a lot of people you know,” he says, including “very successful business owners or executives.”
Buchmueller, who stopped in Sacramento this week to talk about his company’s entrance into the California insurance market, said it’s intended for those who want an extra level of attention because their busy lives and work demands don’t permit them to handle insurance-related tasks on their own.
A typical customer, according to the company, pays an average $10,000 a year in premiums for all of the coverages combined. (Members also are required to put in an annual “surplus contribution” for five years, which is 10 percent of their homeowners’ policy and 4 percent of their premiums for cars, jewelry, art, etc.) According to Buchmueller, the premiums and annual contributions – on average – are 25 percent lower than what customers were previously paying for traditional insurance and the extra riders needed to cover their jewelry, artwork and other valuables. The company has contractual agreements with “an elite network” of global, independent insurance brokers in each of its major regions, including the local office of Willis Group Holdings in Sacramento.
Policyholders – or members – receive a “subscriber savings account” that’s theirs to keep if they ever give up their policy. Because PURE doesn’t have traditional stockholders or a lot of “legacy” issues with older policyholders in risky areas, it’s able to keep its current premiums at acceptable levels, it says.
The company says its adjustors respond immediately and personally, rather than routing members through a call center. In the case of a claim for repairs, it will handle vetting contractors and scheduling appointments.
It also pays attention to averting damage from natural disasters, providing a “risk manager” who will walk your property and home to identify potential risk factors, such as trees that need trimming, brush that needs clearing, eaves that need screening, an alarm system that needs updating and other preventive measures. If desired, a “member advocate” will arrange for hiring the work to be done.
For claims above $10,000, the company also will pay up to $2,500 for services to prevent future losses, such as hiring an arborist to trim trees or installing home security systems, whole-house surge protectors or water shutoff valves.
All those services are included in the premium price.
As part of its emphasis on elite services, PURE also provides services that aren’t typically offered by traditional insurers. One New York client, for instance, had a large sculpture that was insured but needed additional protection while her home was undergoing renovations. PURE had it crated and stored during the home’s reconstruction. In another case, it helped a Houston couple who returned from a vacation to find their home was flooded. Within hours, PURE said, there was a team of remediation experts on hand, removing soggy furniture and belongings, then overseeing a 10-week repair process that included finding the family a temporary apartment to live in.
“When there’s a loss, it’s the effort that matters more than the dollars,” Buchmueller said.
The California Department of Insurance says companies like PURE may prove valuable for customers. “If they can sustain that level of service, all the better for consumers,” said department spokesman Patrick Storm.
It doesn’t circumvent the need for doing your homework, however.
“When you’re buying a homeowners’ policy, these (concierge policies) are wonderful things to look at, but you want to be sure you’re buying from a good company with a good reputation for good customer service,” said Salvatore of the Insurance Information Institute.
The most important detail, she said, is to be sure your policy covers enough to rebuild your home and replace all your personal possessions in the event of a disaster.
In general, consumers should always consider some basic factors when purchasing any type of insurance.
“While the services provided may very well be enticing, you want to make certain your insurer will be there when you need them, typically when you need to file a claim,” said Tully Lehman of the nonprofit Insurance Information Network of California.
He recommends comparing policies and rates of several insurance companies, either online or by phone or with a broker. He also recommends looking up the insurer’s complaint history on your state’s website, such as www.insurance.ca.gov in California, as well as doing an online search of companies by name “to see what other experiences customers have had,” Lehman said.
About This BlogClaudia Buck is the Personal Finance columnist and business editor at The Sacramento Bee. She's worked at The Bee since 2005. Amid the financial turmoil of the recent recession, she became the personal finance writer, helping readers cope with some of the confusing, daunting and perplexing aspects of managing our financial lives. She serves on the journalism advisory board of her alma mater, Cal Poly State University, San Luis Obispo. Reach her at firstname.lastname@example.org or 916-321-1968. Twitter: @Claudia_Buck.
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