ELITE ADVISOR BEST PRACTICES
’Tis the Season… For Accidents, Burglaries and Other Mishaps
How to help your clients manage holiday-related risk
By David Hubbard
- Insurance claim experience has shown that increased social activities and travel throughout the holiday season lead to a corresponding rise in accidents and property damage.
- You and your clients can lessen the chance of problems by anticipating the frequent causes of mishaps and taking proactive steps to mitigate them.
- The holiday season also is an ideal time to revisit the insurance coverage that is currently in place, to make sure that protection will be adequate in the unfortunate event of a claim.
The holidays are a time for family gatherings, entertaining friends, gift-giving and travel. It’s also a time when homeowners and their guests have increased exposure to accidents, property damage and theft.
Following is an overview of the most prevalent incidents as well as practical tips that you can help your clients employ to maximize their protection at home and on the road.
1. Home entertaining
- Hosting events at home increases the potential for accidents that can lead to personal liability lawsuits. Examples include guests slipping on a wet floor or an icy walkway, a car accident caused by an “over-served” attendee, sickness due to spoiled food, dog bites and more.
- Possessions inside the home are subject to breakage or theft as a result of increased foot traffic. In addition, fires can stem from overloaded electrical outlets, neglected candles, unsecured decorations and cooking mishaps.
- If outside help is hired, such as a catering company or a valet parking service, any actions or injuries sustained on the premises can be blamed on the homeowner.
What your clients can do:
- Consider the weather conditions and how they will impact traffic inside and outside the home. Take precautions to address wet, slippery walkways or foyers. Notify guests to take extra care around areas that are particularly crowded or that you know to be potentially unsafe.
- Be mindful of holiday décor. Could items on upper levels fall? Are there any obstructed areas that could pose a safety concern?
- Move high-value items (particularly artwork, breakables and sculptures) away from high-traffic areas when possible.
- Keep jewelry and other smaller valuables out of sight and locked in safes whenever possible. If your client has a wine cellar inside the home, lock the entrance.
- Have contact information handy for local taxi services in case guests cannot drive home safely.
- Do not leave candles burning in unoccupied rooms. Unplug interior decorations before going to sleep, and unplug appliances not in use. Avoid using old plugs that don’t fit snugly into the outlet. In addition, replace devices or décor that has frayed wires.
- If an outside vendor is helping with the party, request a certificate of liability insurance and proof of workers’ compensation insurance to ensure that their insurance will respond if there is an incident.
2. Leaving the house unoccupied
- Weather events increase the chance of property damage. Freezing temperatures can lead to burst pipes; heavy rains, wind and ice can cause power outages and flooding.
- A vacant home is a target for burglars.
- Announcing vacation plans via online social networks can also increase the risk of burglary.
What your clients can do:
- Occupancy is the best prevention. If clients aren’t in a position to hire a caretaker, they can have a friend or neighbor check the property periodically—with their car clearly visible in the driveway if possible.
- Look to technology. Low-temperature sensors and water shutoff devices can help identify problems before they get out of control. Set lights to turn on/off throughout the day—not just at night.
- Conduct a professional security assessment to ensure that the existing alarm system provides optimal protection against burglary, fire and low temperatures.
- Also consider behavior patterns that can elevate the risk of burglary. For example, if the family travels at the exact same time each year, it’s easier for a criminal to target the home.
- Advise family members to use social media wisely. Don’t announce to a broad (and often unknown) audience that the home will be vacant.
- Liability laws may vary from country to country, as does the climate for litigation.
- Gifts and other items purchased abroad are often lost or damaged before making it home.
- Valuables are left accidentally in hotel rooms or on planes.
- If a family member gets sick or injured, nonrefundable tickets may be canceled or trips cut short. In a remote destination, top-quality medical care may not be within reach.
What your clients can do:
- Consult an insurance professional prior to their trip to better understand local laws and their coverage, particularly if renting a car or recreational vehicle. When possible, choose an excess liability (umbrella) insurance policy that offers worldwide coverage.
- Leave high-value jewelry at home, in a safe or safety deposit box. If they must travel with jewelry, keep it with them at all times; do not place it in checked luggage.
- If larger or fragile items purchased on vacation (such as artwork or cases of wine) cannot travel home with them, consult a specialized shipping company for assistance. Notify their insurance agent of any substantial new purchases to ensure coverage from the time they become the owner.
- A homeowners’ policy may not be sufficient for jewelry, art and other high-value collectibles. A separate private collections policy offers more appropriate coverage.
- Obtain travel insurance, which can provide coverage for medical evacuation as well as trip cancellation.
- If a family member has a pre-existing medical condition, prior to departure identify local emergency contacts at their destination.
Insurance claims can be disruptive on many fronts. In addition to taking proactive steps to minimize the likelihood of damage, it is crucial to have adequate coverage limits in place if an incident cannot be avoided. Your clients with substantial wealth can benefit from annual reviews of their property and liability coverage needs. Consulting an independent insurance agent or broker who specializes in the high-net-worth niche is the best way to access the broadest range of product and service solutions designed for their lifestyle.