The numerous surveys recently published speak with one voice : wealth management services are no longer limited to asset management.
« What are today’s HNW families’ non-financial needs ? » is a relevant question to ask yourself as a wealth manager willing to make some new and innovative ideas bloom, such as a digital communication.
If you can’t ease their life, you can offer higher protection. Today’s tendency to over expose one’s private life is a major risk for wealth managers’ clients. Scandals related to personal life often break out leaving the concerned parties unable to control the consequences, often tragic, in terms of reputation, family cohesion and sometimes also financially. In order to protect its durability a family, just like a company, must be able to protect itself and overcome difficult situations by preserving its stability and strength. It’s the purpose of the Private Risk Management (PRM), which addresses the risk as a whole.
Private Risk Management assesses and combats risks that can jeopardize the objectives of a person or a family. It can concern the composition of the net worth of course but also the personal protection or the behaviour of the members of the family. PRM provides sound advice and practical solutions that can cover various fields such as simple best practices, protection equipments or even internal procedures.
This kind of service is an innovation offering a radical departure from traditional wealth management. However, it turns out to be a very relevant service to provide. Wealth managers have a strong legitimacy in the role of private risk manager. They have a strong and loyal relation with their clients, a broad knowledge of their profile, of their family and social relations, their lifestyle, their personal and profesionnal objectives, etc. All they need to do is to develop a specific offer and skills.
As an example, managing and preventing personal risks involve the action of different specialists : insurances, fiscalists, lawyers are the most obvious ones. But to have a global approach, you must include also doctors, sport coaches, housekeepers, babysitters and any exterior person who intervene in the private arena. The Private Risk Manager coordinates them and makes sure that they comply with the best practices established to manage and reduce any risk that can weaken its client and his family.
Private Risk Management is not yet very developed but it clearly adresses the expressed and unsaid needs of HNWI for personal protection of their life, their family and their reputation. Since it can’t but be deployed on the long run, PRM is undoubtly a powerful differentiation and retention tool for independent managers.