As successful families grow over time, so does the complexity of their risk profile, and with it, the thought and care needed to maintain annual risk management and insurance planning. Many multigenerational families take the opportunity to engage in annual risk and insurance planning:
One simple way to ensure risk doesn’t get overlooked is to make an agenda item at every annual wealth and financial planning meeting. Here is how to do that, and some best practices to facilitate the discussion and its aftermath.
Making the Most of the Meeting
Annual financial planning meetings are a good place to raise risk issues because they’ve already been established as a time to address matters that impact them, in a setting designed for communication and information dissemination.
There are different ways to incorporate risk management at these meetings. Some families survey individual members about which risks are most present in their lives (i.e., hurricane threats, emergency preparedness planning, travel planning, loss of collectibles, etc.) in the weeks before, then use what they’ve learned to set the discussion. Others bring in a risk expert to guide the conversation and educate members. Regardless of approach, the goals are to identify issues, raise awareness, and explore mitigation and prevention strategies. Drawing out personal stories is an especially effective teaching tool, so encourage attendees to share how they evacuated their home before an encroaching wildfire, or lost a piece of artwork to flooding, or navigated a lawsuit brought by a domestic employee. It’s critical that all generations, including the youngest, are involved in the discussion; everyone needs to understand what is at stake.
Developing An Action Plan
The following steps are a roadmap to guide your family through your conversation and beyond.
- Raise the topic of risk: Begin the conversation about what constitutes risk and what is already being done to mitigate it. This conversation can be structured to encourage family members to ask questions that will help educate all generations.
- Start an annual review of family risk areas: Assess your family’s risk footprint and profile. Consider potential exposures across health, travel, property, financial, legal, and reputational areas. Discuss recent changes in lifestyle, assets, or activities that could introduce new risks, and review any past incidents or near-misses. Doing so will support risk education, engagement, and informed planning.
- Create a plan: Include an insurance strategy for your particular areas of risk.
- Utilize insurance as a strategic risk management tool: Adjust it annually as the lifestyle and concerns of family members change.
In today’s challenging risk landscape—with rising natural disasters, cybercrime, high-dollar lawsuits, and other exposures—multigenerational families could surely benefit from professional support. Experts can create a comprehensive plan that focuses on both prevention and protection through the right insurance coverage.
In any case, looking at your family’s risks holistically will make you and your relatives more aware of the issues and more resilient as a result. Integrating risk planning into the annual meeting ensures that critical concerns are addressed by relevant parties and that everyone works together to safeguard the family legacy well into the future.
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