Property, Casualty and Liability Insurance

Money Matters Radio Show

April 11, 2011

Property and Casualty and Liability Insurance

Question: What does property casualty and liability insurance have to do with Estate planning?

Answer: Everything. If you're not property insured, you may have no estate left.

Question: Does this affect a lot of people?

Answer: Shockingly, yes. The vast majority of wealthy people we meet have inadequate liability coverage. If you have a multimillion dollar estate, you should have a multimillion dollar excess personal liability policy. Some people call this an umbrella, because it provides coverage over your homeowner and automobile coverage.

Question: What other common mistakes do you see?

Answer: Very few people review their insurance coverage regularly, and everyone should. Lots of wealthy people buy their insurance from a lizard, instead of a knowledgeable insurance consultant. Lizards are great for people's pocketbooks, but not for wealthy insurance planning.

Question: What types of issues might a policy review pick up?

Answer: Gaps in coverage. For example, if you have your umbrella policy with another company, does it pick up where your homeowners and auto insurance policy leave off? Many wealthy people have low dollar deductibles, which are so low that it's not practical to file a claim at that level. Yet, they have inadequate coverage on the high end, or have missed important components of coverage.