While most people will never experience a catastrophic loss that tests the boundaries of their insurance contract, as a Money Smart Athlete you should always have a strategy in place which anticipates that shock loss you never expected; knowing that your insurance program was structured properly makes you feel secure and worry-free.
Athletes have the added challenge of their fame which can bring more unusual exposures than the average person. Everyone remembers the car accident that Venus Williams encountered which brought a wrongful death suit against her from the family of a 78 year old man that died from the collision. Venus has been cleared by the local police department from all wrong doing but the wrongful death suit is still in play due to the potential payout from a very wealthy athlete.
The challenge for athletes is – how would you know that you are insured properly and with a solid Insurance Advisor. There is a series of things to consider when evaluating both your Insurer and your Insurance Advisor and we set an abbreviated list of the most important ones below.
Evaluating your Insurer:
- Did your insurer appraise your home and other structures? If not, you are likely underinsured on your property, especially if the insurer is a heavily advertised company.
- Does your insurer provide higher Excess Liability limits to cover your net worth in the event of a large third party claim? Most commonly recognized insurers will not provide more than $5 million for your Excess Liability and they will not provide an opportunity for you to purchase Excess Uninsured Motorist coverage in the event of a catastrophic automobile claim.
- Does your property insurance provide guaranteed rebuild coverage in the event of a total loss? There is plenty of evidence on the web of people that have not been able to rebuild their home after a catastrophe such as a wildfire or a hurricane.
- Is your insurer offering risk management services to help in mitigating claims to simplify your life? A few of the boutique insurers offer services that protect your home from a wildfire and services to respond to your home after a hurricane.
- Does your insurer allow for entities such as an LLC or Trust to be added to the insurance policy? Many times we see policies that do not keep pace with the estate planning which is particularly important for high net worth athletes. This could lead to an unpaid claim and a costly financial hit.
Evaluating your Insurance Advisor:
- Does your insurance advisor understand what keeps you up at night and what annoys you about your current program? Most times they do not ask.
- Has your coverage truly been tailored to your needs? You may find that you are overinsured in certain categories and underinsured on others.
- Do you see a year over year comparison of your coverage and premiums? You should see recommendations on how to save money and about coverage options that are pertinent to your needs.
- Have you been educated on the exclusions and limitations of your insurance program? There is no policy that covers all claims that you could encounter.
- Are you told to call an 800 number if you have a claim? Your Insurance Advisor should be engaged in the claim process and should not just hand you off to the insurer.
Insurance Advisors are often asked “how much liability coverage should I carry?” My response: Claim payouts continue to increase each year for a variety of reasons. Minimum limit I might recommend is $10,000,000. We are seeing more and more claims eclipse the $5,000,000 threshold. Your insurance advisor should be well versed with the specifics of your lifestyle by asking the right questions which will help him/her devise a tailor-made protection plan just for you. Such questions include:
- Do you have any drivers in the household under the age of 25?
- Do you drive exotic or sports cars such as a Ferrari, Porsche or a Bentley?
- Do you own recreational vehicles such as a yacht, RV or a UTV/ATV?
- Do you utilize LLC’s or Trusts for estate planning?
- How do the driving records look for all household members?
- Do you employ domestic staff?
There are many other important insurance and risk management issues that should be discussed with a successful athlete. Personal security, the internet of things and keeping a low digital profile are issues that should be addressed so that appropriate strategies are formed. Sports stardom brings about a number of risks. Celebrity athletes have already too much on their plate, so it is imperative that they are properly covered from the perils of life and the perils of their sports profession. A seasoned insurance advisor can definitely add value to celebrity athletes by foreseeing and hedging against these perils and, in consequence, offer athletes comfort and peace of mind.
Hollie Gorman’s career of advising high net worth clients began in 1996 when she served the affluent community in the Vail Valley of Colorado where she worked in the private client sector as well as writing insurance for small business owners. In 2003, this University of Florida graduate moved to Ormond Beach, Florida where she took a position with the corporate office of Brown & Brown running the Personal Lines Department. She attained the Certified Insurance Counselor Designation and completed Brown & Brown University in 2007. She became the Private Client Group Profit Center Leader in February 2010.
In addition to developing customized insurance solutions for Brown & Brown clients, Hollie is an active board member with Junior Achievement, the Treasurer for the Christian Sanderson Museum, as well as an active member in the Council on Insuring Private Clients, the Estate Planning Council of Delaware, and the Delaware Bankers Association. She is also an Associate Member of the National Business Aviation Association (NBAA), and is actively pursuing the newly created Certified Personal Risk Manager (CPRM) designation through the National Alliance.
You can contact Mrs. Hollie Gorman at [email protected]
