WARREN, NJ, December 7, 2006 - Evolving complex personal and lifestyle exposures have increased the need for financial advisers to devote more time to
helping manage their clients' risk, according to a white paper developed by the Chubb Group of Insurance Companies. Published
in the current issue of The Journal of Wealth Management, "Managing Personal Risk in an Era of Rising Wealth and Proliferating
Threats" addresses the evolving risk profile of affluent individuals and the increasing need for the financial planning community
to integrate risk management into the wealth management process.
"The world is changing. Globalization, technology advancement and rising litigiousness are creating a web of costly exposures
that can jeopardize any client's financial plan," writes Eric Pruss, senior vice president of Chubb & Son and strategic marketing
officer for Chubb Personal Insurance. "As a result, financial planners must address their client's personal property and liability
exposure, and insurance coverage. Developing a holistic personal risk management program that complements and enhances an
individual's financial plans will nurture and protect personal assets, health and security."
According to the white paper, to effectively incorporate a risk-management approach into wealth-management programs, financial
planners need to consider a broader range of client risks. The paper suggests planners:
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Delve into the details of their clients' lifestyles, paying particular attention to the risks that may develop and the mitigation
strategies to keep them in check;
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Address the quality of clients' insurers and the breadth of coverages they provide by asking a series of questions to raise
'red flags' about unique or complex risks that aren't sufficiently protected by typical insurance products; and
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Develop personal risk-management skills by forging relationships with certain independent insurance agents and brokers-intermediaries
who have experience and expertise in risk assessment and mitigation and can access a wide variety of insurance products from
different providers.
Financial advisers are reacting positively to the white paper's publication. "When it comes to asset protection, there can
be a large gap if advisers don't thoroughly review all the types and levels of coverage their clients have," says David Bibicoff,*
a financial adviser in White Plans, NY. "Wealthy people want to make sure that they don't lose their wealth. A disconnect
can exist between clients who want to be sure they don't lose their house and advisers who are focused on asset management."
Additionally, as clients' asset bases often increase with age, many people neglect to adjust their liability coverage limits
accordingly, which can expose a substantial portion of their wealth to loss over time. While liability limits are commonly
addressed by financial advisers, risk exposures often extend beyond those related to standard liability coverage.
"The risk management approach will enable financial planners to add value to their client relationships," writes Pruss. "More
importantly, it will help protect the very assets that planners and other wealth managers have helped their clients to amass."
A copy of "Managing Personal Risk in an Era of Rising Wealth and Proliferating Threats" can be obtained by emailing your name,
firm and address to personalinsurance@chubb.com.
The member insurers of the Chubb Group of Insurance Companies form a multi-billion dollar organization providing property
and casualty insurance for personal and commercial customers worldwide through 8,000 independent agents and brokers. Chubb's
global network includes branches and affiliates throughout North America, Europe, Latin America, Asia and Australia.
*David Bibicoff, a registered representative and financial adviser of Park Avenue Securities, LLC (PAS), a financial representative
of the Guardian Life Insurance Company of America and a representative of Strategies for Wealth Creation and Protection, which
is not a subsidiary or affiliate of PAS or Guardian.
