| NEW YORK
NEW YORK U.S. insurers are targeting the wealthy as one of the few client groups willing to pay higher rates and buy more policies, and competition to serve those people is increasing.
From life insurers to property and casualty underwriters, the story has largely been the same in recent weeks: the economy is not strong, there is not a lot of growth to be seen and the market for new policies of all kinds is tight.
But wealthy clients are clamoring to use life insurance to shield their estates from inheritance taxes and to use property and casualty insurance to protect increasingly valuable assets like works of art and gold jewelry
The market historically has been the province of a handful of insurers, including the "big three" of Chubb, Allianz's Fireman's Fund and American International Group Inc.
Relatively new entrants like Ace Ltd are ramping up. Ace entered the market in 2008 with the acquisition of Atlantic Mutual's high net worth business, and has tripled its size.
By Ace's estimate, the big three players in the sector account for less than 15 percent of the premiums in the market, which is why it was attracted to the business.
"Our goal would definitely (be) to be mentioned in the same breath," Bob Courtemanche, CEO of ACE Private Risk Services, said in an interview.
Chubb said it was seeing competition from ACE in particular, and from other insurers in general.
"Yes, the competition is fairly healthy. There is room for some of it, I think, virtually all of it," Chubb Chief Executive John Finnegan told analysts last month, adding that Chubb was constrained in some areas and that competitors were trying to pick up business.
Analysts said the competition would likely put pressure on prices. But at the same time, competitors will also face challenges getting into the market in the first place.
"The brokers want to go with someone they trust. My impression is that that's a segment of the market that's very focused on service so it'd be especially hard to break in," said Morningstar insurance analyst Drew Woodbury.
RELIEVED TO SEE COMPETITION
One of the biggest players in selling life insurance to rich clients said the upswing in competition was good news for her business and clients.
"When you hear lots of talk about consolidation, that's always a bit nerve-wracking," National Financial Partners Chief Executive Jessica Bibliowicz told the Reuters Wealth Management Summit in New York recently.
Bibliowicz said her company was ramping up its recruiting for marketing employees in its life insurance business, where it sells to wealthy customers seeking estate planning and ways to preserve their wealth.
ACE is pushing traditional products for its clients as well as coverage for things like collisions with uninsured motorists -- a problem Courtemanche said is rising directly in correlation with higher unemployment.
The best way to make its case to rich people is for a company to prove itself by handling disasters for its clients quickly and efficiently.
"In Greenwich, Connecticut, there is cocktail party conversation that comes from that process," Courtemanche said of the enclave for wealthy executives.
(Reporting by Ben Berkowitz. Editing by Robert MacMillan)