This is not a boring subject
Not too long ago, I welcomed a couple of clients into my office: young parents and successful entrepreneurs, seasoned investors. I present them with different scenarios of retirement plans and, above all, financial independence.
Everyone is excited, especially since financial success smiles on them!
Now is the time to talk about insurance. If a tool existed to measure an audience's enthusiasm, they wouldn't have detected anything, I swear ...
A financial planner should talk about finances and wealth management, but the job also requires addressing insurance and risk management issues. For my clients, this is probably the most boring subject.
At the start of my practice, I made this coldness a little personal, but I understood over time that my perception of these financial tools differs a lot from theirs (and that it is not my communication skills that are involved!).
Because while I know how much fun it is to help clients reach their targets, I also know that their most valuable asset is often the most overlooked: their ability to generate income.
Until financial independence is achieved, all dream scenarios remain hypothetical (and often conditional on good health).
And unfortunately I have seen that an uninsured estate can leave loved ones in need. People who dream of insurance are often the ones who are no longer entitled to it ...
Survive when something goes wrong
Let's agree on one thing: far from me the idea of wanting to scare you. There is always a way to organize yourself to survive if something goes wrong.
However, on social media, I regularly see fundraisers to help families whose members are struggling with a health problem. Each time, I can't help but sympathize, but also think that critical illness insurance would have been a game-changer.
And even when you have a well-heeled family network, it's not a pleasure to ask for charity, especially if your loss of income is likely to last over time. Disability insurance helps prevent this situation.
Sometimes emotional
Talking about insurance can sometimes be as emotional as discussing politics or religion as a family. "Insurance costs too much", "insurers are all ...": the murderous sentences, I have heard them all.
"My parents left me nothing and I worked it out," too. This is my favorite, because above all it denotes a misunderstanding of the usefulness of life insurance.
Yes, it is possible to be over-insured. I often see clients with poorly adapted or unnecessary protections. Or permanent life insurance that costs too much for their needs and budget. But we must not confuse everything. If you have large assets, life insurance MUST be viewed as a tool for diversification. If you can achieve your financial goals while optimizing your estate, why hesitate?
The next time your financial planner talks to you about insurance, be nice to him and listen to him with interest. The amount of risk management options to analyze can be overwhelming, but once it's passed, there is real satisfaction, I can tell you from experience.
Too much or not sufficiently insured?
Do you think you are too insured? Or not enough? Write to me and I can present my recommendations for a future case study. I will answer the following questions in future columns:
Wouldn't it be better to invest more in my investments than in insurance?
Is life insurance profitable only for the estate?
Why do I get the impression that insurers never “pay” for a claim?
Some advice on personal insurance
Do not purchase any loan-related life or disability insurance.
Analyze your needs with the help of a professional.
Take the time to see if your current insurance matches your needs.
Shop, regardless of the type of insurance! The services of an independent broker who is familiar with the many products on the market can be invaluable.
Ask all the questions necessary to fully understand the protection that a new policy offers you.
For insurance matters relating to persons owned by a company, surround yourself with professionals who are competent in tax matters.
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