Investments, with or without leverage, mainly address the concern that wealth, if left untouched, decreases in both absolute and relative terms due to inflation, spending, and taxes. In the life of the rich, however, there are many more concerns:
These are the types of concerns that we address in Parts Four and Five. In Part Four we look into the role life insurance could play in the management of one’s wealth, followed in Part Five by a detailed discussion on wealth structuring.
Insurance is usually divided into life and non-life. In this book we only focus on life insurance, as this type of insurance, if applied well, plays a potentially important role in addressing the abovementioned types of concerns. Non-life insurance, such as health, car, art, liability, and so forth, is also important in the overall management of wealth, but plays a less strategic role. Non-life insurance is meant to straightforwardly cover actual costs or replacements costs (in the case of loss or damage) and does not require much input from wealth advisers.
In this part on life insurance we look in Chapter 8 at the general use of life insurance as well ...