Insurance often feels like an unnecessary expense—until a crisis strikes. Much like a sturdy roof during a hailstorm, insurance shields you from the unexpected, preserving your wealth and protecting your family’s lifestyle. Whether it’s a car accident, a natural disaster, or a less-discussed event like disability or long-term care needs, insurance helps ensure that life’s surprises don’t derail your financial future.
A Story About Unseen Risks
Take, for example, a financial advisor whose client believed their insurance was sufficient. Their teenage son was involved in a car accident that resulted in a lawsuit. The family’s liability coverage fell short, exposing their assets and threatening their financial security. This situation could have been avoided with proper planning and an annual review of insurance coverage to ensure it aligned with their growing wealth.
The Importance of Identifying and Transferring Risk
Life evolves, and so do your financial responsibilities. Here’s how insurance plays a vital role:
Family Income: Disability insurance protects against the financial strain of being unable to work.
Liabilities: Umbrella insurance adds a layer of protection to safeguard your wealth in lawsuits or accidents.
Estate Planning: For high-net-worth families, permanent life insurance can help cover estate taxes, preserving wealth for future generations.
Long-Term Care: In-home care or assisted living policies shield your savings from the high cost of care.
A Proactive Approach to Peace of Mind
Insurance premiums aren’t a financial “loss”—they are an investment in stability. By working with your advisor to identify and quantify potential risks, you can ensure those risks are adequately transferred. This is especially important as market growth boosts your net worth, making comprehensive protection more essential than ever.
Final thought
Have you evaluated the risks to your financial well-being recently? Are your insurance policies up-to-date and sufficient to protect your lifestyle? An annual review with your financial advisor can bring clarity, security, and peace of mind to your financial journey. Don’t let the unexpected jeopardize the wealth you’ve worked so hard to build.
Take control. Plan ahead. Protect what matters most.
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About the Author
Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind.
Peak Wealth Planning offers personalized concierge services to meet your wealth management needs, including financial planning, investment management, ESOP diversification, retirement income, insurance, and estate planning. As a fee-based financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states.