Updated Wednesday, October 22, 2014 as of 11:43 AM ET

Insurance Smarts: What Clients Really Need

If youíre like many advisors, talking about insurance may not be your favorite part of the job. Clients donít love it, either: Insurance is just not as inherently exciting as discussing how to grow their portfolios.

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Comments (1)
"If you're like many advisors, talking about insurance may not be your favorite part of the job."

It is, however, MY favorite part; and here's why it should be everyone else's:

1) Every financial planning topic and discussion is ultimately one of risk management.
2) As this piece stated, clients typically misunderstand and underestimate its importance.
3) Almost every client is dangerously underinsured in some respect.

I realize that investments are "sexier" than insurance, and I also understand that the larger CFP community is made up of investment advisors; not what I would consider financial advisors. They believe that they can do no greater service for their clients than to reasonably ensure double-digit returns and avoid as many taxes as possible (ironically, they discount insurance products as being among the greatest tools they have available to ensure some the best net-of-tax income in retirement).

Everybody wants to talk to their clients about investment strategies, but true financial professionals have a comprehensive understanding of insurance issues, even if their investment knowledge is relatively weak. The average Joe can do about as well with his retirement portfolio talking to a mutual fund rep on the toll-free sales line as he can working with most of the readers of this publication; but without sound insurance advice, he or his heirs are likely to face financial ruin.

Rob Drury, Executive Director, Association of Christian Financial Advisors
Posted by Rob D | Friday, August 08 2014 at 11:11PM ET
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