While the generational wealth transfer that will unfold over the next decade is expected to present advisors with unprecedented opportunities, it also will pose new challenges. Some advisors may lose assets because they failed to build relationships with clients’ heirs, or because their trust services partners’ priorities are not aligned with their own.

Others, however, may lose assets due to a completely preventable miscalculation: underestimating the importance of risk management tools and insurance solutions as part of the estate planning and wealth transfer process. Put simply, a client’s heirs and surviving family members are much more likely to stay with an advisor who takes the time to prepare them for the loss of a loved one well in advance.

While many advisors still view insurance as a commodity, a robust and proactive approach to integrating risk management solutions can help advisors differentiate their practices, establish strong relationships with clients’ heirs and retain assets across generational lines.

Of course, no one should expect advisors to master the complex insurance market in addition to wealth management. By working with insurance marketing organizations that have the expertise to support them, advisors can incorporate strong risk management capabilities into their practices without having to invest a great deal of incremental time or resources. Many of these organizations have evolved well beyond providing access to products from multiple carriers and processing support to offer services that position them as value-added partners for advisors.

Here are the key features advisors should look for:

  • One-on-one counseling that enables the marketing organization to act as a true strategic partner. Insurance marketing organizations (whether they go by FMO, IMO, BGA or any other acronym) that add strategic value for advisors are those that invest in the personnel, systems and expertise necessary to understand advisors’ businesses — and then take the time to conduct one-on-one discussions to learn about each advisor’s goals, business model, experience level and client base.

Traditional marketing organizations take a predominantly reactive approach toward supporting advisors, responding to their requests for quotes and new policies but rarely providing more valuable strategic insight. Because of this, wealth management professionals would be better served working with an organization that can leverage their deep understanding of the advisor’s business and extensive risk management experience to proactively suggest estate planning solutions and other opportunities that the advisor may not spot on his or her own.

Such options may include exploring buy-sell agreements and key-man insurance for advisors who work primarily with business owners, or starting conversations on policy reviews and trust document updates for advisors with high-net-worth clients, among many others.

  • In-depth planning capabilities to assist with complex cases on an as-needed basis. Implementing many of the more intricate options above — especially when several of them need to be combined to meet the estate planning needs of large clients or those with complex holdings — can be time-consuming for advisors, potentially taking attention away from other crucial client-related tasks.

To operate at peak efficiency while also providing comprehensive risk management solutions for larger clients, advisors should seek out insurance marketing organizations that have developed cross-disciplinary teams of experts who can serve as ‘bolt-on’ insurance solutions groups for advisors faced with challenging client situations.

Such teams should include estate planning attorneys and tax specialists, in addition to experts in every applicable type of insurance product — all of whom should be fully familiar with advisors’ practices and how to serve them most effectively. These teams also ideally will have access to experienced case managers and highly trained underwriters who can, among other functions, identify the best carriers for clients with various medical impairments.

  • Marketing and education support to help advisors proactively incorporate risk management into client conversations. Simply being available to assist advisors with risk management cases will not help them optimize their use of insurance solutions to meet clients’ long-term planning needs. Insurance marketing organizations therefore should be prepared to leverage their expertise to invest in their advisor partners’ ongoing education, as well.

To help advisors continually expand their understanding of how insurance products can address client challenges, such organizations should demonstrate a consistent commitment to providing both one-on-one training and one-to-many educational resources (including weekly ‘tips & tools’ emails on various sales concepts; monthly webinars; archives of topical articles; breakout sessions at conferences and more).

Importantly, the goal of these resources and training programs should be to help advisors re-envision how estate planning and wealth transfer discussions connect to — and can be better served by — a broader approach to risk management, rather than seeking to turn advisors into insurance experts per se.

As the current historical transfer of assets progresses, advisors may soon find that the skills and business models that helped them succeed in the past will not help them maintain momentum in the future. To retain assets across generations, advisors will need to understand the central role insurance solutions play in the estate planning process, and collaborate with insurance marketing organizations that can help them seamlessly expand their strategic capabilities in this area.


Adam Malamed is executive vice president and chief operating officer at Ladenburg Thalmann Financial Services (www.ladenburg.com). Paul Lofties is senior vice president of wealth management at Ladenburg.