Good morning, good afternoon, good evening. Depending on the part of the world you’re in. This is Jonathan Satovsky of Satovsky Asset Management and on today’s episode of “Seeking Wisdom, Wealth, and Wellness,” I want to talk about insurance reviews.
What is insurance? The idea of insurance is generally to protect. To pull resources in order to protect from an outsized, catastrophic event, whether it’s a disability, long-term care, premature death, home/auto liability, hurricane, business, or employment liability—there are all sorts of different types of insurance. But specifically, today, I want to talk about life insurance and I want to talk about permanent insurance.
Now, this is way too much of a topic for a two-minute vlog, but the simple notion is that you have to make a decision whether you want to rent by term and invest the difference, or if you own a permanent policy—in which case, either you’re going to control the investments or you’re going to rely on the insurance company to control the investments. In either case, there are going to be assumptions that are made. Those assumptions rarely play out precisely as assumed. That’s why they’re assumptions. So it requires annual and ongoing reviews to see how the assumptions, the current versus the guaranteed, reprojections play out in order to ensure expectations are matched for sustainability so that the policy doesn’t run out on you.
So you can’t sit still, you’ve got to keep reviewing any investment plan, even if it’s a fixed insurance policy that’s paying a fixed perceived to be the stable rate of return, because the assumptions may change on your path to Wisdom, Wealth and, Wellness. Assure your own sustainability.
Have a great day.