Estate planning – the other half of insurance advice

In your role as an adviser, you regularly conduct a comprehensive review of your client’s insurance needs.  You determine the funding requirements for the family in case of death or disablement and subsequently implement appropriate insurance coverage, which often makes up a large component of their estate.

Congratulations, the good news is you are 50 per cent on the way to meeting your obligations to your client and uniquely placed to add even more value to this relationship by making yourself indispensable to your client in a way that few other advisers do.

By taking your client through a logical, productive and informative estate planning facilitation process, you can educate and empower your clients to answer the following important questions:

• Who will be able to make financial, medical and lifestyle decisions on my behalf if I am unable to do so, and how will they know what I want?
• Should my superannuation assets be directed to my will or is my family better off receiving those assets directly?
• How can I make sure that my assets go to the right people at the right time? I don’t want my children to receive large amounts of money when they are too young.
• How do I make sure that my assets are protected in the hands of my beneficiaries and don’t disappear if they get divorced or become bankrupt?
• What happens to assets in my family trust and company?
• How can I reduce the tax payable by my beneficiaries to make their money last longer?
• How do I make sure my children are raised by the people I want and in the way that I want?

Like many aspects of financial planning these, as well as other estate planning questions, are not usually front of mind for our clients and require a deeper discussion to identify potential threats and possible solutions.

For the clients, this discussion is not just educational but extremely valuable as they begin to understand the consequences on their surviving family when a well-developed estate plan has not been put into place.  These estate planning discussions can show clients how to set in place strategies to protect their beneficiaries and in turn provide peace of mind.

Many advisers are concerned about the regulatory pressure around life insurance commissions and how to make the transition to fee-for-service. By introducing estate planning as an integral part of your insurance discussion, your clients will soon realise the value you, as the adviser, are adding to the process and that they won’t get this from an online insurance provider.

How do you make estate planning a part of your service? Well, it’s quite simple. There are now software solutions that are both easy to use and produce highly personalised briefing notes that the client can take to any good estate planning lawyer to implement their wishes.

There are also online legal solutions that provide a simple and inexpensive alternative to produce the legal documents required to set the strategy in place.

Finally, if you need some brushing up on your estate planning knowledge and skills, there are numerous short courses that can enable you to be confident to begin that conversation at your next review meeting.

Hans Egger is managing director and co-founder of Astute Wheel