Insurance plays a pivotal role in our financial lives, yet it remains one of the least exciting topics for most people. At Ducharme Wealth Management, we dedicate an entire quarter of our annual planning cycle to reviewing insurance policies with our clients. This systematic approach ensures that insurance coverage is optimized within the broader financial plan, neither leaving gaps that could create financial disasters nor wasting money on unnecessary coverage that drags down wealth-building potential.
The primary reason we position insurance reviews in the third quarter is strategic. Summer vacations often bring people face-to-face with their mortality through near-death experiences (think adventure sports or even just highway travel), making them more receptive to discussions about life insurance. Additionally, this timing aligns perfectly with the approaching open enrollment season for employee benefits and Medicare, allowing clients to make informed decisions rather than scrambling at the last minute.
When conducting insurance reviews, we focus on several key categories. Financial planning insurances include life insurance, disability insurance, and long-term care insurance—policies that require careful calculation and integration with your overall financial plan. Property and casualty insurance encompasses homeowners/renters insurance, auto insurance, and umbrella policies. Health insurance considerations include evaluating HSA options and coverage levels. Each category serves a specific purpose in your financial protection system.
Life insurance reviews involve reassessing whether coverage remains appropriate as life circumstances change. Have you had more children? Gotten married? Built more wealth? Sometimes we discover clients no longer need the coverage they’re paying for, while others need significantly more protection. Long-term care insurance warrants special attention, particularly given its complicated history. Traditional policies became notorious for premium increases that made them unaffordable precisely when clients needed them most. Modern approaches to long-term care planning offer more stable solutions that should be evaluated as part of a comprehensive plan.
Homeowners and auto insurance reviews frequently reveal opportunities for optimization. Common issues include underinsurance (having only state minimum coverage), policies that haven’t been shopped or updated in years (sometimes decades!), and deductibles that don’t align with financial capacity. For instance, maintaining a $500 deductible when you have $20,000 in savings typically means you’re overpaying for premium in exchange for minimal benefit. We often recommend increasing deductibles to match your emergency fund capacity, potentially saving hundreds annually.
When reviewing property insurance, we also emphasize often-overlooked coverage gaps. Most homeowners don’t realize that standard policies exclude flood and earthquake damage. These supplemental policies are surprisingly affordable in many regions—earthquake coverage can cost as little as $6 monthly in some areas—yet could prevent complete financial devastation. Consider the catastrophic impact of a home collapse due to an earthquake: not only would your equity be wiped out, but you’d still owe the remaining mortgage while needing to finance a new home.
Umbrella liability policies represent another critically overlooked protection tool. If you own a home and have a job with assets to protect, an umbrella policy provides extended liability coverage beyond your standard homeowners and auto insurance limits. This becomes especially important if you have “high-risk” features like swimming pools, trampolines, dogs, or recreational vehicles. Even if a neighborhood child uses your trampoline without permission and gets injured, you could face significant liability exposure.
The philosophy we advocate isn’t about maximizing insurance coverage across the board. Rather, we recommend obtaining sufficient insurance to prevent catastrophic financial setbacks while aggressively investing remaining resources for long-term growth. This barbell approach—being ultra-conservative with risk management while being growth-oriented with investments—creates an optimal balance that supports sustainable wealth building. The goal is to use insurance strategically, so you never have to liquidate investments to handle emergencies.