I spoke to 33 real estate investment clubs in 2019. In almost every audience someone asked me the following questions.
“Why do I need to protect my assets, isn’t that what my insurance is for?”
I always give the same answer, “Buy all the insurance you can afford but do not rely solely on your coverage. It is just one leg of the asset protection stool. Furthermore, please read your policies. Do not assume that you have coverage for all events that can happen to you.
Insurance policies have LOTS of exclusions!
Risks come in many, many forms. You can purchase protection for some of them, less your deductible, of course. And for some of them, there is no policy. For still other risks, your insurer will share it with you, up to a point.
Why is this important? Here’s an example. With the advent of the coronavirus, I called my agent. I called to find out if my business insurance policy covered me for business interruption. He calmly explained that while I had business interruption coverage, coronavirus was NOT covered!
Isn’t it frustrating when you pay premiums for 40+ years and NEVER have a claim then when you need the coverage the most . . . it’s not there! This is just one example of why I said 33 times during 2019 . . . “Don’t rely on insurance for your total asset protection plan.”