Lending a hand after the flood

In storm-ravaged Vermont, where more than a dozen towns were left isolated last week due to flooding in the wake of Tropical Storm Irene, financial planner Christopher Bixby is preparing for a different kind of crisis management: client outreach and damage assessment.

“We’re not talking about planning but rather what we can do to help,” said Mr. Bixby, a Burlington, Vt.-based planner with Key Private Bank, part of KeyBank.

A retiree with whom Mr. Bixby spoke last week had recently finished paying off his mortgage. Due to the infrequency of catastrophic storms and flooding in the Green Mountain State, the homeowner had let his flood coverage lapse two weeks before Irene struck.

Mr. Bixby suggested that the client contact his insurer, as most policies have a 30-day grace period for reinstatement.

“Clients aren’t as familiar with the claims process, and they mostly don’t have time to run through it, because they have to rebuild,” Mr. Bixby said.

Although he and other financial advisers typically don’t handle their clients’ property or casualty insurance, many are supporting their flood-stricken clients and providing a broad range of financial guidance, which goes a long way to cement relationships.

For example, advisers along the battered East Coast also are reaching out to clients and offering a shoulder to cry on as well as practical advice about coping with the storm’s financial toll.

Mike Goodwin, an adviser with Edward Jones, said that though hurricanes and tropical storms aren’t novelties in his hometown of Belhaven, N.C., he was surprised to find that he couldn’t reach many clients Sunday, Aug. 28, after Irene had moved on.

He loaded some rescue equipment into his car and drove out to visit them in person, helping others remove debris and tree limbs along the way.

“Many of my clients had three and a half or four feet of water in their homes,” Mr. Goodwin said. “A number of them had significant property damage, and some literally lost their homes.”

Some of Mr. Goodwin’s clients who have lived in the area for more than 50 years said that they have never seen damage on this scale. He expects that many of his clients will be taking a closer look at flood insurance, and he will recommend providers.

“Anytime an adviser goes the extra mile, it makes the client sticky,” said Douglas Heikkinen, president of Riley Weiss, a branding firm. “It’s what you should be doing as an adviser if you care about your client.”

In the case of Mr. Goodwin, for example, who drove to visit his clients personally, Mr. Heikkinen noted: “Those clients will never leave him.”

John Eckel, an adviser with Pinnacle Investment Management Inc. in Simsbury, Conn., was still contacting clients who live along the Connecticut shore late last week, informing them that some property destruction could be classified as flood damage and may not be covered by insurance.

Advisers are providing extra financial help to storm victims in a variety of ways, including scouring through portfolios to find the best ways to cover damages until claims are paid.

“Certainly, we’ll help clients find a way to finance repairs until the insurer can help,” said Mr. Eckel, who added that if a claim is denied, he will meet with the client and look at the situation in more depth.

Mr. Bixby noted that if a client lives in a federally declared disaster area, he or she can take the casualty losses now and amend 2010 tax returns.

The Financial Planning Association is waiting for physical recovery efforts to progress before launching an outreach campaign, said Amira Tart, director of the group’s pro-bono efforts.

“Right now, the efforts are physical,” said Thomas C. Hartman, an adviser with Summit Wealth Group LLC in White River Junction, Vt. “After that, I imagine [survivors] will be able to turn their attention toward claims, bookkeeping and other financial things.”

Physical recovery, especially in Vermont, is likely to take a while.

Flooding has ruined the busiest weekend of the year — Labor Day — for two of his clients who own small nautical businesses along Lake Champlain, Mr. Hartman said.

“The last weekend of the summer can represent their whole year’s profit; this is really going to be devastating,” he said.

Email Darla Mercado at [email protected]