Comprehensive Risk Management
by Takara Alexis

As your career evolves, your compensation, capital and lifestyle often evolve as well - and so will your exposure to risk. Is your insurance relationships and policies keeping pace?

It isn't abnormal for people to accumulate policies and professionals as they go through life's stages. As a young single, you might not have given a thought about life, disability or even renters insurance. Your marriage could have assisted the purchase of life insurance and buying your first home introduced you to property coverage. If you have not bought life insurance already, the birth of a child could make that a priority as well as disability coverage. And these purchases could or could not have been from the same insurance professional or even the same insurance company.

As an executive, your compensation may have changed your lifestyle. Do you accumulate grown-up toys such as pricey cars, boats, or motorcycles? Do you have pricey collections like fine art, jewelry or a wine cellar? Have you documented all those items with paperwork or photos, had it recently appraised and added the correct riders or - in the case of any vehicles others might be using - liability coverage?

As your income increases, so does your need for disability coverage, particularly if your spouse doesn't work. If you bought disability coverage a few years ago, have you recently checked to make sure it still gives adequate replacement for your improved income?

Domestic employees can become more common when the the pressure on your time goes up. Depending on the state, you could be required to give insurance to your nanny, housekeeper, groundskeeper, driver or personal assistant.

Basic homeowners insurance doesn't always provide sufficient coverage for custom-built new houses or historic homes. Of course replacement cost coverage sounds great, most insurers cap rebuilding expenses. Promised replacement does not have a cap, and many companies have specialized policies designed to replace different and expensive details of historic homes or to cover the price of rebuilding historic homes in agreement with current building codes.

The patchwork of insurance relationships and policies you might have acquired over many years may no longer be sufficient. A comprehensive risk management strategy looks at each angle of potential loss, decides which would have the most drastic effect on your monetary well being and finds answers to diminish those risks. Talk to your financial advisor or insurance expert to ensure that your solutions still fit.