In many cases, you may be unaware of what you are paying for and what the coverage entails. The devil is always in the details. Sometimes insurance policies overlap or the product is no longer suitable for your current needs. Other times, your health status may have changed which can have a positive or an adverse effect on the premiums you pay. Understanding the policy contract allows us to utilize the options within it to potentially enhance your coverage.
The critical elements of an insurance audit are:
- Identifying your risk by conducting a Capital Needs Analysis
- Defining what your present policies do & do not cover.
- Identifying potential savings.
- Making appropriate recommendations & implementation.
To find out more about how to arrange an insurance audit or if you have questions simply give us a call.
Capital Needs Analysis
Capital needs analysis is the process of determining the risk and the potential cost associated with a premature death or a life changing event that has an impact on your health or financial wellbeing.
When we refer to capital, we are referring to money.
Capital Needs Analysis is an integral part of Financial Planning, Estate Planning and Business Succession Planning.
Often times, when a financial, estate or business succession plan is being completed the funding solution and the urgency of the need for the immediate required capital is overlooked or underestimated.
These are the common solutions most people think of when they need to address the immediate need for cash:
- Use of available liquid assets/savings
- May result in a potential significant reduction or even depletion of the estate
- May result in a pushing the estate into a higher tax bracket due to deregistration of RRSPs, RRIFs, LIRAs and/or LIFs
- Sale of fixed assets
- May force fire sale of assets which will render a much lower value than their real worth
- May force sale of assets you otherwise wanted to bequeath to a loved one or a charity
- May or may not be a possibility depending on ability to get credit
- Cost of borrowing may prove to be prohibitive
A cost effective and efficient answer to any of these situations can be the use of an Insurance based solution.
Insurance based solutions are often overlooked and misunderstood as an effective means of providing immediate capital when needed most.