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  • “It’s Not You, It’s Me”: We’re Just No Longer a Fit

    An old friend of mine (let’s call him Pete) works for a well-known, national tax services firm. It’s not the type of firm that resides in a stylish high-rise downtown. No, for this, think strip mall and a costumed worker out by the street waving people in during tax season. It is a tax-filing machine that promises to turnaround your tax return quickly.

    I became a client of Peter’s when I first entered the workforce. I knew him, I liked him, I trusted him, and he got me a good deal. My needs were very simple: make sure I’m filed, make sure I don’t pass up any opportunities for refunds. I was a single, employed individual with no kids and an apartment.

    As my career developed and my investments diversified, I began to wonder if I was getting everything I needed from Pete’s firm. My situation had changed but their approach was the exact same. I still knew Pete, I still liked Pete, I still trusted Pete, I simply had out-grown Pete. I moved to another firm that focused on more complex clients. Pete and I remain good friends.

    This scenario could easily be applied to insurance. On the personal insurance side, when someone begins to collect “toys”, buy second and third homes, invest in rentals, hire full-time or part-time service workers, and generally have more assets to protect, the likely have out-grown “cookie-cutter” insurance purchases and require a more thoughtful review process. They need strategy, negotiation assistance for coverage terms, and claims management. They can still expect to have a competitive premium, it will just take more than 15 minutes online to do it right.

    Similarly, when a business expands, adds new states and countries to its operation, takes on larger contracts and more exposures, and generally becomes more complex, it has likely outgrown an “off the shelf” insurance program. They will require a more customized contract and a deeper risk management and risk transfer relationship with their agent. They may have more to lose in a catastrophic lawsuit or property claim, and, thus, need an advisor who can help navigate all possibilities and negotiate a better insurance contract.

    In many cases, addressing this growth dynamic will mean acknowledging that an old friend who has handled the insurance needs is not suitable anymore. They’re still friends, they’re still smart, they’ve done a good job over the years, but you have outgrown their area of expertise. The worst time to find this out is after a significant claim goes unpaid or drags out due to coverage restrictions. That situation will be much more devastating to your friendship than an honest conversation about ending the professional arrangement.

    Please note, agents who focus on larger, more complex insurance programs can be found in agencies of all sizes. To that end, agents who don’t understand complex insurance programs can be found in agencies of all sizes. Consider your situation and ask yourself if it is time to interview other advisors. Have you outgrown your current relationship?

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      “It’s Not You, It’s Me”: We’re Just No Longer a Fit