Property and Casualty Risks for Affluent Clients: Helping Your Client Avoid Disaster

Waterworth, Tim
April 2004
Journal of Financial Planning;Apr2004, Vol. 17 Issue 4, p48
Academic Journal
The article discusses how financial planners can help their affluent clients to avoid the risks in insuring their property and personal liability. Affluent clients face greater complexity and greater risk than the average client when it comes to insuring their property and personal liability. Yet many financial planners gloss over this area, potentially exposing themselves to professional liability. A standard review of homeowner's auto and umbrella coverage is not sufficient. Affluent clients may have multiple homes in multiple states, employees who work on their property, and collections that are difficult to value and replace. Financial planners have three alternatives for advising in this area: leave the responsibility in the client's hands, provide in-house services, or outsource to property and casualty specialists. The planner needs to coordinate a client's coverage of multiple properties in different states under different agents, and integrate it with auto and umbrella coverage. With collections and other valuable personal belongings, planners need to be aware of such issues as what is true value, repair versus replacement, and depreciation due to a partial loss. The affluent are more apt to live in areas requiring natural catastrophe coverage.


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