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Tim and Anna: Risk Management

In your white paper presented to Tim and Anna, you shared with them the need to adopt a strategy that includes preserving current assets as well as creating future growth. As a result, you provided the tools they needed to consider to accomplish their goals: property and liability insurance for protecting their lifestyle assets, healthcare and disability insurance for protecting their earning capacity, life insurance and estate planning for protecting their dependents, and retirement planning for protecting their leisure years. You further shared with them the numerous types of risks the private duty nursing firm might encounter: business risk, financial risk, and portfolio risk.

Armed with this information, Tim and Anna have asked you to provide them details of the products or services available to assist them in managing these risks.

Additionally, Tim reflected that one of his peers at work became temporarily disabled without other income. This alarmed Tim, and now he wants to understand immediately his disability insurance needs. He knows they need 80% of his gross income ($72,000 annual or $6,000 monthly) and that the employer-provided amount would be $4,000 per month. No other benefits would be available, including social security.

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Tim and Anna: Risk Management

Given the sophistication of the financial services industry today, it is now easier more than ever to create a financial product with the specifications of the clients. This means that a financial product can actually be created which is designed to insure the property and liability of Tim and Ann for protecting their lifestyle assets while another product takes care of their healthcare and disability insurance for protecting their earning capacity. What I am trying to say here is that it is now virtually possible to create a financial product tailored to the risks that both Tim and Anna want covered. This part of the paper presents analysis of several financial products which help Tim and Anna achieve their objectives as regards their financial positions.

First, let's address Tim's concern. He narrated that a peer became temporarily disabled without other income, and he was thus alarmed and wanted to know his disability insurance needs. Let me state first that this issue is included in the strategy needed to be put in place in protecting Tim and Anna's earning capacity through healthcare and disability ...

Solution Summary

This solution provides a paper discussing risk management.