I was appointed by the court as the liaison coverage counsel for the putative class members in the collapse of the Champlain Towers South. This week, a team of extraordinarily skilled lawyers that I have been working with filed an amended complaint explaining how we currently believe this catastrophe happened. It is a very sad matter. It is hard to be witness to the horrible aftermath the victims and their families live with.

Part of my job is reviewing hundreds of insurance policies which may provide various coverages in this case. While reading the numerous insurance policy forms, it is obvious to me that some purchased different and better or worse insurance coverage than others. It made me think of how important it is to pick the right insurance agent and for businesses to have a really good risk manager overseeing their insurance coverage program.

Insurance educator Bill Wilson warns of the importance of having a true professional help with the selection and placement of a solid insurance program in this manner:

If you were going to sky dive for the first time, would you pack your parachute yourself? Would you insist that someone else pack it as fast as possible with almost no attention to detail because you’re in a hurry? Or pack it with their eyes closed? My insurance program is my financial parachute. There are no shortcuts to security unless you’re buying insurance with no exclusions or policy limits and most of what is being sold on the internet is far from that.

I suggest readers of this blog take some time to read the amended complaint and think about the insurance you have personally and for business purposes. Are you fully insured if your property was wiped out? Do you have a policy with broad open perils coverage or limited named perils for both structure and personal property? What would happen if you or your business caused a significant loss to another from your actions, inactions, or advice? Would you have the right liability coverage to pay for what you may have caused?

The point of this post is to provide an example of why you need a great insurance agent to help you determine the risks you face and purchase the right types of coverage. In my book PayUP!, I wrote:

[U]sing a good agent you can trust is so important. Find an agent that is knowledgeable, experienced, and willing to put in the time to understand your unique insurance needs. Being an insurance agent is a significant calling. Insurance companies constantly change their policies. Keeping up with the changes and available products is a huge undertaking. On top of that, insurance agents must understand the idiosyncratic needs of each policyholder. Great agents should also be willing to put the interests of the customer above their own or that of the insurance company and provide honest and accurate advice.

Liberty Mutual’s current ad campaign calling for customers to “only pay for what you need” is crazy. Unless you are in the risk analysis business and understand the importance of one particular coverage over another, it is impossible for most lay people to figure out what insurance they need.

Tragedy always provides hard lessons. Please take some time to financially protect yourself from life’s sad tragedies and find a great insurance agent to help you.

Thought For The Day

Tragedy is a tool for the living to gain wisdom, not a guide by which to live.
—Robert Kennedy