After decades in the insurance and advisory world helping business owners, families, executives, and high net worth individuals navigate decisions they never expected to face, one truth stands out above everything else.
The smartest and most successful people I have met all embrace two things.
They value planning.
And they value planning for the unexpected.
And this is not a pitch to buy insurance. It is the opposite.
I have seen people purchase too little coverage and I have seen people purchase far too much. I have designed every type of plan you can imagine. But after watching thousands of real world outcomes, one thing is certain.
Success leaves clues.
The top performers in every field understand one simple principle.
Leverage plus risk transfer equals freedom.
They do not rely only on their own balance sheet.
They do not pretend that they will never get sick, disabled, sued, or caught off guard.
They use planning tools, including insurance, to protect what they have built and to create options for the future.
But for the average person, interacting with insurance companies is challenging.
They move slowly. They are rule driven. They are never proactive. And if you are not careful, the smallest mistake can cost you dearly.
After a lifetime in this industry, these are the four biggest mistakes people make with insurance and long term planning.
1. The “Set It and Forget It” Approach Is the Most Dangerous Strategy
Many people buy insurance and never look at it again.
But the world changes. Health changes. Costs change. Products evolve. Some policies lose value. Some become obsolete. Some explode in cost later in life. Some were designed incorrectly from the very beginning.
Every insurance product should be reviewed once a year.
Not every five years. Not “when I get to it.”
A one hour review would have saved many people years of financial stress.
2. Incorrect Ownership and Beneficiary Designations
This is one of the most common and damaging mistakes.
Insurance always pays the person listed on the form, not the person you intended.
Divorces. Remarriages. Estranged family. Business partners. All of these create landmines.
I have seen:
• Former spouses receive multi million payouts
• Children accidentally disinherited
• Unnecessary estate tax exposure because of incorrect ownership
• Qualified plans left to the wrong people
• Policies pulled into a taxable estate due to bad structure
And once the insured passes away, the form controls everything.
This is the easiest mistake to fix and the hardest one to correct later.
3. Policy Owners Who Never Request Annual Ledgers
This has created more “oh no” moments than anything else in my career.
Most people who own whole life, universal life, or indexed universal life have never:
• Requested an in force ledger
• Checked crediting rates
• Reviewed internal charges
• Stress tested how long the policy will last
Then one day they receive a letter that says:
“Your policy needs additional premium to stay active.”
This usually happens when they are older.
Usually when they are on fixed income.
Usually when the cost is significant.
A simple annual review prevents these surprises.
4. Forgetting That Insurance Is a Buyer Beware Category
Insurance companies will not remind you about:
• Better options
• Declining performance
• New features
• Updated riders
• More efficient strategies
They do not call. They do not email. They do not offer courtesy reviews.
This lack of proactive service has caused many lawsuits over the years.
Time and neglect is a dangerous combination.
This is why stewardship matters.
This is why an advisor matters.
My Recommendation: Hold an Annual Planning Summit
Once a year, gather your advisors.
Your insurance professionals
Your estate planner
Your accountant
Your business attorney
Your financial advisor
Review the following.
Your goals
Your exposures
Your balance sheet
Your beneficiary designations
Your insurance portfolio
Your business risk
Your tax posture
Your estate planning documents
Make sure everything aligns.
If your advisors avoid reviewing what you already own, you are working with the wrong people.
Planning is not a one time event.
It is a living and evolving process.
It is the foundation of financial confidence.
The most successful people I have ever met understand this.
And you should too.
Marty Levy, Founder, CorpStrat
