Protect Wealth & Reduce Expenses through Retirement

Most successful people retire when their assets are at a peak. They have full equity in their home (or homes) and have accumulated enough savings and investments to generate an income that will sustain a comfortable lifestyle. Protecting that asset base is critical to protect wealth & reduce expenses through retirement that could last 20, 30, or even 40 years. Financially successful couples and individuals in or near retirement face some of the most complex decisions about insurance than at any time in their lives. While health and long-term care insurance usually top their list of concerns, personal property & casualty insurance, including homeowner, automobile and liability coverage, also deserve a thorough review. They play a key role in two overriding issues during retirement: wealth protection and expense management.

From a wealth protection standpoint, one of the most serious threats to net worth involves a lack of adequate insurance coverage. Liability lawsuits is another serious risk exposure that can center around auto accidents, slips & falls at home, disgruntled domestic staff, a small side business, volunteer work at a favorite charity, and more. Awards and settlements from liability lawsuits can reach tens of millions of dollars, yet more than 40 percent of wealthy households carry less than $5 million in coverage.

Another major threat involves property loss at home. Most successful people in or near retirement have full equity in their main residence and other properties they may own.

Although this equity typically represents a large portion—if not the largest portion—of their net worth, many do not carry enough insurance to fully rebuild their home after a total loss. The contents of the home can also be significantly underinsured. A study of high value homes found that nearly half had insufficient coverage for contents, and the average amount of underinsurance was $600,000.

Home contents may also include collections of fine art, jewelry, wine and other valuable items that have taken years to amass. A study of wealthy households found that 94 percent collected valuable objects, and the average value of the collections was $1 million. Yet nearly 40 percent did not have all of their collections insured with a valuables policy.

From an expense management perspective, financially successful people in or near retirement often overlook easy savings opportunities in their personal insurance program. They carry policy deductibles that are too low. They fail to take advantage of package discounts by combining their policies with one carrier. They do not claim credits for alarm and other safety systems in their homes and autos, and they insure rarely driven classic cars with standard auto policies.

To help retirement planners and their clients address these issues, this white paper presents 18 steps to strengthen wealth protection and reduce expenses when working with an independent insurance advisor on a personal insurance program. In combination, these steps can maximize the value of insurance expenditures and help financially successful people prepare for and thrive in retirement.

  • Approve annual or bi-annual meetings with your insurance agent to discuss changes to your personal insurance portfolio.
  • Introduce your financial, personal and legal services ‘team’ with your insurance agent: Attorney, CPA, Financial Planner, Personal Assistants, etc.
  • Manage sales records and installation slips for high-end appliances and service contracts.
  • Purchase enough umbrella liability insurance to match assets at risk.
  • Seek full replacement cost coverage for the home and other structures.
  • Ensure that the homeowner policy includes sufficient coverage for building code upgrades.
  • Take an inventory of home contents and make sure the coverage limit for personal property matches its replacement cost
  • Use the added protection of a valuables policy for jewelry, art, wine, and other precious collections, and keep an inventory and record of item/set appraisals.
  • If the home is part of a property association, make sure the homeowners policy includes ample coverage for loss assessments.
  • Address the need for director’s & officer’s liability if volunteering as a board member or trustee of a charitable organization.
  • Attend to liability risks originating from hobbies turned into small businesses.
  • Name trusts and limited liability companies (LLCs) on insurance policies.
  • Increase homeowner and auto deductibles to lower annual premiums.
  • Bundle separate policies with the same insurance company.
  • Verify with your insurance agent that your household pets are not on a restricted list.
  • Get credits for hail resistive roofing materials, loss prevention systems, and upgraded plumbing, electrical, and heating systems.
  • Insure classic autos with a classic auto policy, not a standard auto policy.
  • Discuss significant liquidity events with your insurance agent and ensure that timely communication is given on the purchase or sale of assets.

Swingle, Collins & Associates specializes in plans to Protect Wealth & Reduce Expenses through Retirement personal property and casualty insurance coverage in Dallas, Southlake, Highland Park, and Plano. The descriptions of coverage listed on this website are brief and subject to the provisions, limitations, and exclusions that can only be expressed in your policy and related endorsements. For additional information of how Swingle, Collins & Associates can assist in meeting your specific planning needs to Protect Wealth & Reduce Expenses through Retirement by proper Insurance coverage needs for property and casualty insurance please contact your dedicated risk manager to discuss the benefits and services of personal homeowners insurance coverage.

The information contained on this page is provided for informational and educational purposes only. It contains general information on insurance issues and may not reflect the most current developments in insurance coverage and is unlikely to apply in all factual scenarios. The information does not include all the terms, coverage, exclusions, limitations or conditions that may be contained in the actual insurance contract language. The policies themselves must be read for those details. Sample policy forms will be made available upon reasonable request.