From the July 2006 issue of Investment Advisor • Subscribe!

July 1, 2006

Two Cautionary Tales

David Bibicoff, a planner from Strategies for Wealth Creation & Protection in White Plains, New York, reiterates the need for planners to anticipate protection needs with these two client stories.

In the first, one of his clients, a young man who owns an antique and decorating business, was told at the time of his marriage by his new father-in-law to buy an umbrella policy. The client took his father-in-law's advice. When, at the age of 26, he was involved in an automobile accident in which someone was killed, the umbrella policy "saved his business," says Bibicoff. "The accident was enough to deal with emotionally, but he could have lost everything."

The second tale involves a client of Ron Altman of A. Zeeman Co. in Mount Kisco, New York. This client, a small business owner, did not have an umbrella policy and insured a vehicle used for his business on his personal car insurance policy. To make matters worse, he covered employees as other drivers on this policy. When one of his employees was involved in a serious accident, the lack of a business policy to cover the vehicle and the employee exposed the client's personal assets to potential loss in the lawsuit he now faces.

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