Michael Bonevento has been an Ameriprise financial advisor for 17 years, but the events on September 11, 2001 forever changed the way he approaches discussions about risk management with his clients. After the tragedy, he was approached by a number of families who were directly impacted and were experiencing severe financial strain as a result of their unexpected loss. This experience has led Bonevento to passionately encourage his clients to protect themselves and their families with adequate insurance as one of the most important parts of a financial plan.
“As a financial advisor, it is my obligation to have a conversation with my clients about risk and protection,” says Bonevento. The challenge, he admits, is that many clients become defensive and avoid talking about the exposure their families may face. However, once the risks are made apparent, they are relieved to know that there are ways to protect themselves against a financial meltdown following an unexpected loss or disaster.
One of the biggest misunderstandings surrounding insurance coverage is how it all works. According to Bonevento, many people are naturally intimidated by it. “Sometimes people get hung up on the cost, and they fail to look deeper and see the value and peace of mind that comes with insuring themselves and the people and things that are important to them,” he says. “Insurance expenses are nothing more than the price of being prudent – and there is a great value in prudency.”
Bonevento admits that such conversations can be uncomfortable. “Nobody wants to imagine themselves a victim of the unexpected,” he says. But to convince his clients that their risk exposure is worth a closer look, he approaches the topic mathematically and emotionally. He admits that many people are surprised when they see the amount of risk they have compared to the relative cost of protection that will eliminate such exposure. “Along with the emotions that would accompany an unexpected event, imagining the financial turmoil that could also ensue without adequate protection is very real. It’s compelling,” he says.
So what advice does Bonevento have for those who are sitting down to review their insurance policies? Do your research and make decisions based on math, not emotions. “Many people learn about insurance and what is offered through their workplace benefits from coworkers in the break room. And frankly, this information is usually inaccurate.” he says. “It’s important for people to know how they’re protected now and to what extent, and to look for solutions if they’re exposed to risk.”
Before you purchase, be sure to ask your financial advisor about the insurance policy’s features, benefits, risks and fees, and whether the insurance is appropriate for you, based upon your financial situation and objectives. Variable life insurance is a complex investment vehicle that is subject to market risk, including the potential loss of principal invested.
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