Risk Management

Wealth accumulation and wealth protection are different disciplines. A portfolio can be well-constructed and still leave a family exposed — to the death or disablement of a principal earner, to the loss of a key person in a business, or to a buy/sell arrangement that has never been funded.

Risk management is the part of financial advice that matters least until it matters absolutely.

Where we advise

Personal risk

Life, total and permanent disablement, trauma and income protection cover for family members. For clients with substantial balance sheets, the question is rarely whether cover exists but whether it is structured correctly — held in the right entity, owned by the right party, and sized to the actual exposure rather than a default multiple.

Business risk

Key person cover, buy/sell funding, and debt protection for business owners. A shareholders' agreement that specifies what happens on a principal's death is only as useful as the funding behind it. We advise on both the cover and the structure it sits within, working alongside the client's lawyers and accountants.

Insurance within superannuation

Cover held inside a superannuation fund — including a self-managed fund — can be efficient, but suitability depends on the members and their circumstances outside the fund. We advise on what belongs inside super and what does not.

How we assess cover

We have strong relationships with major insurers and use them to obtain terms that reflect a client's actual circumstances. Our assessment considers:

• Underwriting quality — cover written on the basis of full disclosure, assessed properly at application rather than contested at claim

• Policy terms — definitions of disablement and trauma vary materially between insurers and matter enormously at claim time

• Structure and ownership — who holds the policy, who pays the premium, and the tax treatment that follows

• Claims experience — an insurer's record of paying claims is a legitimate factor in recommending them

• Cost — appropriate and economic cover, reviewed as circumstances change

Review

Cover put in place ten years ago frequently no longer reflects a client's position. Businesses are sold, debts are repaid, children become independent, and balance sheets grow. We review existing cover as part of our ongoing relationship rather than treating it as a one-off transaction.

Who we advise

Garnaut Private Wealth advises wholesale and sophisticated investors as defined in the Corporations Act 2001. Our risk management clients are typically families, business owners, professionals and senior executives with substantial personal and business exposures.