Consider offering long-term care insurance

by The HR Specialist: Compensation and Benefits on May 29, 2012 9:00am
in Centerpiece,Employee Benefits Program,HR Management,Human Resources

As baby boomer workers grow older and employees of all ages worry about their economic security, it might be time to consider offering long-term care insurance as a voluntary benefit. More employers are, even as the number of carriers offering the insurance shrinks.

According to new research by health care benefits management firm HighRoads, 51% of large employers make long-term care (LTC) insurance available to employees, up from 48% two years ago.

LTC insurance helps defray costs for people who need assistance with daily living. It covers skilled and custodial care in insureds’ homes, adult day care centers, assisted living facilities, nursing homes or hospice facilities.

Most employers that offer LTC in­­surance do so on a voluntary basis. That is, employees pay the premiums, so it costs employers nothing to provide.

HighRoads found that more than 90% of the employers that offer LTC do so as an additional benefit to their employees. The rest offer LTC insurance as part of their overall health care strategy or because a union contract requires them to offer the benefit.

Note: Some large employers roll LTC coverage into group health plans, a move that offers tax advantages to both the employer and the employee. However, this “qualified plan” coverage is relatively expensive, and the number of firms offering it as an employer-­provided benefit has been falling, according to HighRoads.

Growing need, fewer carriers

According to data from surveys conducted by the Health Policy Institute at Georgetown University, more than 10 million Americans annually need long-term services and support to assist them in life’s daily activities. That number is growing as the population ages and people live longer.

Yet options for obtaining LTC coverage have been shrinking.

The number of companies selling LTC insurance peaked in 1989 at 143, and has been declining ever since. Now, fewer than 50 insurance companies write LTC policies. Blue Cross/Blue Shield organizations are among the most active providers.

“It is a serious issue when insurers no longer are willing to provide this” coverage, says HighRoad’s CEO, Michael Byers. “Millions of Americans will be left without a safety net should they become disabled.”

LTC insurance is attractive to many employees because they worry that they won’t be able to pay for care on their own. (See “Long-term care insurance by the numbers” in box below.)

The high cost of long-term care doesn’t only affect the individuals who need it. It’s bad for employers’ bottom lines, too. Employees’ long-term care­­giv­­ing responsibilities cost U.S. employers $25 billion a year.

How to decide on LTC coverage

LTC insurance isn’t right for every employee. Experts say about 10% of eligible employees can be expected to sign up for voluntary coverage.

Premiums are age-rated, so younger employees pay relatively less. A 30-year-old in good health might pay $90 per month for usual coverage, while a similarly healthy 60-year-old might have monthly premiums of more than $150.

If you decide to offer LTC insurance, work with your broker, who has access to information about a variety of plans. These guidelines can help you make a good choice:

• Find a carrier with a strong track record. The LTC market shakeout has left mostly well-established in­­surance companies. Still, this is insurance for the long haul; you want a carrier that will be in business for decades.
• Don’t focus too much on premium cost. Your employees will have to de­­cide if they can afford LTC insurance. Your task is to assess the real value of the coverage. Look for the highest-quality coverage per premium dollar.
• Benefits communication is key. Plan to spend lots of time explaining the value of LTC insurance, the life circumstances that make it im­­­­portant and why coverage may be beneficial. Your broker can provide information to help employees assess whether LTC insurance makes sense for them.

Because LTC insurance is a voluntary benefit, don’t oversell it. Give em­ployees the information they need to make informed decisions about their needs.

Long-term care insurance by the numbers

According to the American Association for Long-Term Care Insurance:

• On average, a year of care in a nursing home costs $80,850. Costs can easily top $100,000 per year in expensive metropolitan areas such as New York and Boston.
• Those costs can wipe out nest eggs. For about three-quarters of individuals entering a nursing home, the first year of care exhausts their life savings.
• 92% of all LTC claims are for three years or less.  Just 4.5% of individuals need long- term care for six years or more.
• LTC insurance covers more than nursing home care. In fact, four people use it to pay for in-home health care for every one person who needs nursing home care.
• The average age of a new LTC insurance policy holder is 58.

” This information is proudly provided by Business Management Daily.com:

http://www.businessmanagementdaily.com/30974/consider-offering-long-term-care-insurance “

Insurance Myth #3 — I have an old car, so I don’t need a lot of coverage.

The age of your car has very little impact on your potential liability, if you’re in an accident, so you do need good liability limits. But, it may make sense to reduce the amount of “comprehensive” and “collision” coverage, but only if you can afford the risk and cost of having to repair or replace the vehicle on your own.

Insurance Myth Number 2 – “I don’t need renter insurance…

Insurance Myth Number 2 – “I don’t need renters insurance because my stuff isn’t worth much.”. 

Do you care about being sued? Renter Insurance does more than just protecting your stuff. It covers personal liability, at your place if someone gets hurt.

Also, when you combine your auto and renter insurance you will get additional discounts. In most cases, you’ll save enough on your Auto coverage to pay for your renters insurance.

Insurance Myth Number 1

Insurance MYTH … Umbrella Insurance isn’t important for most folks –

Protection with an Umbrella

You don’t need to be wealthy to be SUED! Lawsuits are very common… making umbrella insurance an important tool. It gives you added liability coverage above and beyond the limits of personal home, and auto insurance policies. And, it’s not that expensive to get a million or 2 of coverage.

 

Spring Newsletter has sprung

How can you insure against loss of income?

If you were disabled and unable to work as a result of an accident or illness, what would you and your family do for income?

Disability income insurance, which complements health insurance, can replace lost income. Forty-three percent of all people age 40 will have a long-term (lasting 90 days or more) disability event by age 65.

There are three basic ways to replace income:

    Employer-paid disability insurance
This is required in some states but not here in Massachusetts. Most employers provide some short-term sick leave. Many larger employers provide short or long-term disability coverage, typically with benefits of up to 60 percent of salary lasting from a few months to age 65, and in some cases extended for life. I work with both employers and employees with this important benefit option.
  Social Security disability benefits
This can be paid to workers whose disability is expected to last at least 12 months and is so severe that no gainful employment can be performed. I have found that this coverage is very difficult to qualify.
  Individual disability income insurance policies
Most people can qualify for individual disability coverage. The premium for this type of coverage is based on your occupation, the waiting or elimination period before benefits begin and the amount of income to be replaced. Other limited replacement income is available for workers under some circumstances from workers compensation (if the injury or illness is job-related), auto insurance (if disability results from an auto accident) and the Department of Veterans Affairs.

For most workers, even those with some employer-paid coverage, an individual disability income policy is the best way to ensure adequate income in the event of disability. When you buy a private disability income policy, you can expect to replace from 50% to 70% of income. Insurers won’t replace all your income because they want you to have an incentive to return to work. However, when you pay the premiums yourself, disability benefits are not taxed. (Benefits from employer-paid policies are subject to income tax.)

There are many different insurance companies offering a lot of different types of coverage, in Massachusetts. If you have questions about insurance or would like a no-obligation review of your current coverage, I hope you’ll give me a call.

Recipe: Caesar salad with grilled chicken In 2012, my goal is to lose 60 pounds. By cutting way back on CARBS and RED MEAT and cutting out processed foods completely, I’m down 22 pounds so far. So I’ve decided to include a recipe each month. I’d love to hear about your goals and how you are achieving them. Dieter’s tip: Romaine lettuce has more vitamin A, vitamin C, folate and calcium than iceberg lettuce and I think it tastes better too. Serves 2 Ingredients     2 boneless, skinless chicken breasts, each 3 ounces     3 tablespoons fat-free Italian dressing     For the dressing:     1 1/2 tablespoons fat-free mayonnaise     1/4 teaspoon extra-virgin olive oil     1/2 teaspoon red wine vinegar     1/4 teaspoon Worcestershire sauce     1 teaspoon fresh lemon juice     1/2 clove garlic, minced     1 1/2 teaspoons water     Freshly ground black pepper, to taste     4 cups romaine lettuce     1/2 ounce (about 3 tablespoons) Parmigiano-Reggiano cheese, freshly grated     1/2 cup whole-wheat croutons — None for me please, I’ve cut out CARBS Directions In a sealable plastic bag, add the chicken and Italian dressing. Put in the refrigerator for 30 minutes, turning the chicken over after 15 minutes. Prepare a hot fire in a charcoal grill or heat a gas grill or broiler. Away from the heat source, lightly coat the grill rack or broiler pan with cooking spray. Position the cooking rack 4 to 6 inches from the heat source. Grill or broil the chicken breasts until browned and cooked through, about 5 minutes on each side (internal temperature should be 165 F for 15 seconds). Transfer the chicken to a cutting board and let rest 5 minutes before slicing into strips. To make the Caesar dressing, add mayonnaise, olive oil, red wine vinegar, Worcestershire sauce, lemon juice, garlic and water. Whip together until smooth. Season to taste with freshly ground black pepper. In a large bowl, combine the lettuce, croutons and the Caesar dressing. Toss thoroughly until the lettuce is coated with the dressing.  Transfer the salad to individual plates. Top each salad with the grilled chicken and Parmigiano-Reggiano cheese. Serve immediately. Nutritional Analysis (per serving) Calories 201 Cholesterol 57 mg  Protein 25 g Sodium 565 mg Carbohydrate 13 g Fiber 4 g  Total fat 5 g Potassium 551 mg Saturated fat 2 g Calcium 145 mg Monounsaturated fat 1.5 g

A GARDEN PLAN FOR LIFE

With planting season just around the corner, I came across a garden plan that I believe will help cultivate a bountiful harvest in life.

 Plant three rows of peas: passion, performance and persistence.
 Then three rows of squash: squash gossip, squash indifference and squash criticism.
 Remember three rows of lettuce: Let us be true to our obligations. Let us be unselfish. Let us    be loyal.
 Next, plant four rows of turnips: Turn up when needed. Turn up with determination. Turn up with a vision. Most of all turn up with a smile.
 And, don’t for get the Thyme: Time for fun. Time for family and friends. And time for yourself.

No matter the color of your thumb, grow a garden like this and you will surely enjoy the fruits of your labors.

As any gardener will tell you, it’s important to choose high-quality seeds. Plant and nurture them and keep weeds under control!

You may find that planting only a few kinds of peas will be difficult, but passion, performance and persistence seem to fit the bill for me. Passion tops the list of the skills you need to excel in any endeavor.

Moving down the rows, planting these varieties of squash will promote a positive environment.
In the  lettuce rows our real character is allowed to bloom. Honoring your obligations represents a commitment to your word people expect and appreciate. Unselfishness is fundamental to good human relations.

When you plant turnips, think about how many times people have turned up when they were needed. I am determined to help and determined to get the job done. Vision doesn’t do planning, and it doesn’t anticipate obstacles. It gives a real idea of what is possible, if only you want it bad enough. While a smile may not seem like an important variety of turnips, let me assure you, a smile is one of the most powerful things you can do to have influence over others. That’s why you should never underestimate the value of a smile. It should be standard equipment for all of us.

One of the most trickiest things to grow is thyme. If you’re like the average American, you devote 56 hours a week to work, including commuting; 70 hours to sleeping, eating and other personal care; and 42 hours to leisure activities, of which 16 hours are spent socializing with friends and family. Wow! That’s not much personal time.

Remember, the width of life is as important as the length. This is just a short reminder to all of us working so hard to earn a living. Don’t let time slip through your fingers without spending quality time with those who really matter.

Do I need separate rental car insurance?

With the holiday’s right around the corner, I thought I would share this article from the Insurance Information Institute. It suggests that you contact your insurance agent or me, if you are planning to rent a car to go on that road trip to visit the family. As always, if you have questions, please call.

Do I need separate rental car insurance?

Properly insuring a rental car can be confusing, frustrating and downright daunting. Unfortunately, many consumers do not even think about car rental insurance until they get to the counter, which can result in costly mistakes—either wasting money by purchasing unnecessary coverage or having dangerous gaps in coverage.

Before renting a car, the I.I.I. suggests that you make two phone calls—one to your insurance agent or company representative and another to the credit card company you will be using to pay for the rental car.
1. Insurance Company
Find out how much coverage you currently have on your own car. In most cases, whatever coverage and deductibles you have on your own car would apply when you rent a car, providing you are using the car for recreation and not for business.

If you have dropped either comprehensive or collision on your own car as a way to reduce costs, you will not be covered if your rental car is stolen or damaged in an accident.

Check to see whether your insurance company pays for administrative fees, loss of use or towing charges. Some companies may provide an insurance rider to cover some of these costs, which would make it less expensive than purchasing coverage through the rental car company. Keep in mind, however, that in most states diminished value is not covered by insurers.
2. Credit Card Company
Insurance benefits offered by credit card companies differ by both the company and/or the bank that issues the card, as well as by the level of credit card used. For instance, a platinum card may offer more insurance coverage than a gold card.

Credit cards usually cover only damage to or loss of the rented vehicle, not for other cars, personal belongings or the property of others. There may be no personal liability coverage for bodily injury or death claims. Some credit card companies will provide coverage for towing, but many may not provide for diminished value or administrative fees. Some credit card companies have changed their policies, too, so you may not have as much coverage as you thought.

To know exactly what type of insurance you have, call the toll-free number on the back of the card you will be using to rent the car. If you are depending on a credit card for insurance protection, ask the credit card company or bank to send you their coverage information in writing. In most cases, credit card benefits are secondary to either your personal insurance protection or the insurance offered by the rental car company.

If you have more than one credit card, consider calling each one to see which offers the best insurance protection.
Source: Insurance Information Institute

IRS announces increased 2012 deductability limits for LTCi

IRS announces increased 2012 deductability limits for LTCi

Product is one of the ‘few remaining significant tax-savings benefits’

October 24, 2012- The Internal Revenue Service (IRS) announced increased deductibility levels for long-term care insurance policies purchased in 2012. “For taxable years beginning in 2012, the limitations have been increased,” explains Jesse Slome, executive director of the American Association for Long-Term Care Insurance (AALTCI), the industry’s trade association. “Tax advantaged long-term care insurance remains one of the few remaining significant tax-savings benefits especially meaningful for small business owners.”

The deductible limits under Section 213(d)(10) for eligible long-term care premiums includable in the term ‘medical care’ are as follows:
Attained Age Before Close of Taxable Year 2012 Deductible Limits 2011 Deductible Limits

• 40 or less $350 $340
• More than 40 but not more than 50 $660 $640
• More than 50 but not more than 60 $1,310 $1,270
• More than 60 but not more than 70 $3,500 $3,390
• More than 70 $4,370 $4,240

Source: IRS Revenue Procedure 2011-52 (2012 limits) and 2010-40 (2011 limits)

The American Association for Long-Term Care Insurance is the national association serving insurance and financial professionals who provide long-term care financing solutions.