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Introducing Personal Insurance

2 MIN READ03 FEB 2023

Compound can now help you efficiently source and evaluate personal insurance policies—including life, home, auto, jewelry, fine art, wine, and excess liability—that are specifically designed for high net worth individuals.

When you purchase insurance, you pay to transfer the financial impact of a risk (like a car crash, illness, or death) to someone else (an insurance company). The insurance policyholder (“insured”) pays money (a “premium”) to an insurer, and if the insured-against-thing happens, the insurer pays out according to the policy terms.

From the policyholder’s perspective, this can be an attractive proposition. Regularly paying a little bit each month or each year is easier (and less disruptive) than coming up with a lot of money to cover an expensive, negative event. Thus, buying insurance through recurring premium payments is a better option than going uninsured and potentially facing a very large bill. (In many cases, insurance may even be legally or contractually required.)

From the insurance company’s perspective, the individual policyholder’s risk has been pooled together with myriad other policyholders to create a “risk pool”. While the insurance company doesn’t know which policyholders in the risk pool will experience loss events, it does know roughly how many loss events there will be in aggregate. It sets its premiums accordingly — as long as the insurance company takes in more premiums than it pays out for losses, the insurer makes money. This is the original, basic principle underlying insurance.

As you gain wealth, you gain risk. While something *really bad* happening to you (or your property) is (hopefully) very unlikely, personal insurance may be a good way to de-risk. (Estate planning may be a complimentary method).

As a Compound client, we can help you get personal insurance quickly and reliably.

Note: Compound is not an insurance broker. This is not direct insurance advice. Please work with a professional.

We pair you with the appropriate insurer based on your family’s situation.We give the provider all of the necessary context (i.e. your balance sheet, your goals) to reduce meetings and save time.

Our partners specialize in personal insurance for high net worth individuals, and will design a custom policy around your particular circumstances. They consolidate your coverage—across personal and property insurance—so that you have a single point of contact to file claims, ask questions, and make updates.

And because your personal insurance is integrated with the rest of Compound, we will keep everything organized on your behalf. We use our document vault to track all policies and claims. This means your financial advisor and tax advisor will stay in the loop—so you always have everything up-to-date in one place.

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