May 2021 Volume LVI Number 3


Treloar & Heisel

November 2020 Volume LV Number 6

What are the Gaps in Your Risk Management Strategy?
How Newly Established Dentists and Specialists Might Reduce their Risk Exposure
Jeffrey E. Wherry, CFP®, CLU®, ChFC®
Director of Research and Planning 
Treloar & Heisel Wealth Management
If you’ve been avoiding thinking about risk, now may be an appropriate time to open your eyes to it. Very few people can honestly say they like thinking about unpleasant outcomes, and yet by thinking about negative scenarios, we can actually face them, address ways to mitigate their impact, and then hopefully feel some of the weight lift from our shoulders. My colleagues and I witness this in our financial planning prac- tice on a regular basis, as risk management is one of the six key areas of an individual’s finances we address as part of our comprehensive approach. (In case you’re wondering, the other areas are: cash flow management, investments, retirement, estate, and the impact of taxes.)
When was the last time you reviewed your risk management strategy? Perhaps you never had one. A risk management plan is a foundational part of a comprehensive investment plan. An investment plan that lacks risk management at its foundation is missing an important element.
This list is by no means comprehensive, but if you want a quick list for some of the most common insurance gaps we see, here they are – along with ways to fill the gaps.
Problem: Not having enough disability income coverage 
Solution: Maximize your disability income policy.
This is something you just have to do. Your disability income policy is effectively your income replacement strategy. Were something to happen to you that would prevent you from working in the medium to long-term, this policy could kick in to help provide you with monthly income (provided you satisfy the terms and definitions of the contract.) Review whether your policy covers total disability specific to your specialty, a partial disability if you can still work while disabled but at a reduced income, and offers inflation increases while collecting benefits. In the unfortunate event that it is activated, you want to make sure you can cover your expenses, provide for your family, and even save for retirement. Some companies offer special ‘riders’ (add-on features) that can help you cover retirement saving, student loan repayment, and other financial obligations or goals.
Problem: Exposure to lawsuits.
Solution: Make sure you have an umbrella policy.
An umbrella policy is a kind of property and casualty insurance that covers your belongings (like your car and home) when the limits on your car and home insurance have been exhausted. It may also protect you from liability and defense costs not cov- ered by other kinds of insurance. For example, if your dog bites someone and they sue you, or if a contractor slips and falls on your property, or if your teenager gets into an accident and you are sued beyond the amounts covered by your auto policy. Generally, everybody should have an umbrella policy that goes on top of your auto and home policy; you should have at least a million dollars of coverage and more as your net worth grows.
Problem: Avoiding thinking about death because you’re young and healthy.
Solution: Buy life insurance to protect and provide for the ones you love.
Many younger people don’t feel the need to obtain life insurance – and yet, life insurance is generally most affordable when you’re young and healthy. If you have loved ones whom you’d like to provide for, you should purchase life insurance. Those without families may also need it as collateral for a practice loan or practice buyout agreement as mentioned below. Term insurance is relatively inexpensive, but only covers you for a limited period of time (the "term" of the policy). Permanent life insurance is exactly as the name says – permanent and not restricted to a certain time period.
Problem: Not having a plan for your practice in the event that you or your business partner are disabled or die.
Solution: If you are in business with a partner, consider having an attorney prepare a buy-sell agreement with insurance provisions.
Buy-sell agreements are contracts between business owners for the purchase and sale of a practice in the event of death, disability or retirement. The buy-sell agreement will often es- tablish a pricing formula for the practice, serve to have a ready buyer for the practice and may be used to value the business interest for federal estate tax purposes. In the event of death or disability, the practice purchase under the buy-sell agreement is typically funded via insurance.
Consult with a financial professional.
Of course, one of the most sensible things you could do is to speak with an experienced financial professional, which is what we recommend to anyone who is wondering if they have ap- propriate coverage in the right places.
Treloar & Heisel is a financial services provider to dental and medical professionals across the country. We assist thousands of clients from training to practice and through retirement with a comprehensive suite of financial services, custom- tailored advice, and a strong service-focused support team. For more information, visit www.

Treloar & Heisel, Treloar & Heisel Wealth Management, and Treloar & Heisel Property and Casualty are all divi- sions of Treloar & Heisel, Inc.

Investment Advice offered through WCG Wealth Advisors, LLC, a Registered Investment Advisor doing business as Treloar & Heisel Wealth Management. Treloar & Heisel Wealth Management is a separate entity from The Wealth Consulting Group and WCG Wealth Advisors, LLC.

Insurance products offered separately through Treloar & Heisel and Treloar & Heisel Property and Casualty.

Treloar & Heisel, Inc., Treloar & Heisel Wealth Management, and WCG Wealth Advisors, LLC do not offer tax or legal advice.

This information is intended for general informational purposes only and should not be construed as advice. Please consult with a licensed insurance professional.

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