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For Hurricane-Battered Advisors, Planning Is Key

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For Byron Ellis, hurricanes are old hat. The managing director in United Capital’s The Woodlands office, about half an hour outside Houston, told ThinkAdvisor that Harvey is the fourth or fifth hurricane or tropical storm he’s endured, but it doesn’t matter how a storm is rated. “Both can be equally as bad, whether it’s rain, or electricity is out, trees getting blown down,” he said.

Ellis lives on a creek and decided not to leave when officials instituted a non-mandatory evacuation for his area. “People were saying, ‘Just go, get out, don’t take any chances,’ but the fighter in you wants to say, ‘No. I’m going to stay,’” he explained. “I’m going to make sure if there’s a chance for me to save anything, I can.”

Ellis didn’t suffer any water damage at home, but did get a little water in his office.

(Related: Determining Business Interruption Losses After Hurricane Harvey)

“We have a continuity plan set up, and we used it this time a lot,” he said. His firm keeps a list of employees’ cell phone numbers and addresses so they can communicate following a natural disaster, and has an alternate location to do business if the office is unusable.

“We didn’t have to this time,” he said, though there was some cleanup needed.

Amber Roberson, the director of operations, kept in constant communication with employees to make sure everyone was accounted for. On Tuesday, Ellis and his team took advantage of a reprieve in the rain to get everyone on the phone for a meeting. “We did a roll call. ‘Tell me what’s happening. How’s your family?’” he said.

Ellis officially opened his office again on Thursday.

“What we’ve learned in the financial business is that when this stuff is going down, there are not a lot of money emergencies,” he said. “People aren’t thinking about that. They’re thinking about their lives, their pets, their friends, their loved ones. It’s not really until the dust settles … do our clients need our help.”

In fact, prior to the storm making landfall, Ellis sent an email to clients with contact information for the national office and a cell phone number for a contact in his office.

“We got zero calls. There’s not one person [who called] to the national number, to the cell phone,” Ellis said.

Part of that is due to the planning that Ellis has already done for his clients. “Because of the fact that they have financial plans in place, because their cash reserves are intact, because they have insurance, there’s not a big financial concern,” he said. “There’s going to be some cleanup, but it wasn’t an emergency when we didn’t see the sun for four days.”

United Capital has an operating hub in Dallas and three offices in the Houston area, including Ellis’. The company spent the days following the hurricane reaching out to make sure everyone was OK.

Prior to joining United Capital three years ago, Ellis was completely independent. “We had a continuity plan back then, but it was really all on us,” he said. Earlier this week, United Capital reached out to see how Ellis and his team were faring.

“Just the fact that I can put a number that’s manned by people that can do things immediately made me feel really good. I’ve never had that before,” he said.

The company is making a $100,000 pool available to help its advisors and employees affected by the storm, as well as a $5,000 donation for anyone in need of immediate resources like food, clothing or a place to stay.

“Since many on our Dallas team also have family in Houston, that pool extends to any person that has direct family members that are in Houston or southern Texas and need help,” according to an email sent to United Capital staff and provided by a spokesperson. “After we are past this crisis we will figure out how we can all be helpful in the recovery effort.”

Leslie Beck, a CFP and founder and principal of Compass Wealth Management, in Rutherford, New Jersey, also has some experience testing her continuity plan.

“At the time of Katrina, our office was located in a section of my business partner’s home,” she told ThinkAdvisor. “Katrina knocked out power to his house for two weeks! It was almost impossible to drive into his neighborhood for days. Gasoline was in short supply as was bottled water.”

Beck had set up her business so that it could be managed from anywhere, “using cloud-based services for document storage and client account maintenance. I had power at my house, which was miles away, and we were able to pretty seamlessly continue servicing our clients.”

She noted, though, that her continuity plan was dependent on having access to the internet. She also recommended that people preparing to shelter during a storm keep plenty of cash on hand, as ATMs may not be working even if you can get to them.

Advisors can bolster their continuity planning by selecting geographically diverse providers so that in a disaster, they can help contact clients. “Give [clients] alternate means of communicating (direct to custodian, for example) if they can’t contact you and are in an emergency situation,” Beck said. “Then relocate as soon as possible to an area that will let you get up and running — even if all your staff can’t, at least some might be able to. Redundancy is the key!”

— Read Rock Solid: The 2017 Broker-Dealers of the Year on ThinkAdvisor. 


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