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October 2013

Oct 08
Love0

LIFE INSURANCE: A SMARTER BET THAN A LOTTERY TICKET

By Life and Health

You can’t beat the return on investment by a Powerball jackpot winner in Zephyrillis, FL, last May 18– $590.5 million for a $2 lottery ticket. However, if you’re serious about leveraging dollars for your family, a life insurance policy is a far better bet than the lottery.

Sure, the lottery produces a bigger bang for the buck. The latest payout, in fact, was the largest in history. However, your odds on winning big are infinitesimal: one in 175 million for the Powerball jackpot.

With life insurance, in return for a relatively small premium, the policy pays a large benefit to your loved ones if you die within the term of the policy – an event that’s more likely than winning the lottery, (A study for the LIFE Foundation found that the chance of dying after age 25 before reaching normal retirement age is one in six for men and one in nine for women). The average cost of 20-year, $250,000 level-term life coverage for a healthy 30-year-old male comes to about $150 a year, according to LIMRA. Even better, a permanent life policy will provide a guaranteed payout to your beneficiary(ies).

Life payouts are generally tax free, while Uncle Sam will take a healthy 25% cut up front if you take a lottery payout as a lump sum on a lower amount, rather than an annuity. For example, the tax bite would have reduced the Florida Powerball winner’s one-time payout of $371 million to $278 million.

We’d be happy to demonstrate how life insurance can play an essential role in providing financial security for your family.

Oct 08
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HEALTH CARE REFORM: OPEN ENROLLMENT TIPS

By Life and Health

This year’s open enrollment season for selecting workplace benefits comes just before major health care reforms under the Affordable Care Act (ACA) take effect. Because it’s never been more important to choose a health plan for you and your family, we offer these guidelines for enrollment:

• You’ll need to have health insurance or face a tax penalty. If your employer won’t offer coverage or the plan doesn’t meet minimum standards, you must buy coverage from an insurance company or through statewide insurance exchanges, which opened for enrollment on October 1 (in some cases, you might be eligible for a premium tax credit.).

• Compare benefits and insurance plan networks. Check out provider networks to make sure that they include your doctors and preferred hospital system, especially if you’re being treated for a serious or chronic condition. You’ll pay a lot more to see providers outside the network with a preferred provider organization (PPO) and will probably have to pay the full cost of services for out-of-network providers with a health maintenance organization (HMO).

• Remember that your employer does not have to offer coverage in 2014, and will not cover your spouse – because the ACA limits the definition of “dependents” to children.

• Pick the plan with the best value. Your costs include deductibles and co-insurance (the percentage the plan pays after you satisfy the deductible); copayments for doctor visits, urgent care and emergency room treatment; and your portion of the premium. Run scenarios to see how much each health plan would cost, and choose the one that meets your unique needs.

Our agency’s health insurance professionals stand ready to offer you their advice – just give us a call.

Oct 08
Love0

TRAFFIC TICKETS: LAWYER UP OR PAY UP?

By Personal Perspective

Imagine that you ignored or forgot to pay a few minor traffic tickets – and that the police arrested you as a scofflaw.

It can happen. For the past seven years, the “Great Texas Warrant Roundup” has mailed thousands of notices a year giving citizens with outstanding warrants for offenses such as minor traffic violations two weeks to pay up –or face arrest.

Although this is an extreme example, if you have accumulated numerous tickets for minor violations, you’ll need to choose between hiring an attorney to go to court (assuming that you have a strong case) or paying the fine.

Even though using a lawyer will set you back several hundred dollars, it might make financial sense. If you’re acquitted, the tickets won’t show up on your driving record, which will play a major role when the insurance company sets your renewal rate; if you pay the tickets, your premiums could rise as much as 40% to 50% — a hike that will probably be far more than the attorney’s fee.

If you lawyer up, ask the attorney:

  1. Do you charge by the hour or a flat fee?
  2. What is your rate?
  3. What does the rate cover – and not cover?
  4. How and when do you expect payment?

However, paying up for minor traffic offenses is often the way to go. For one thing, unless you have a strong case, you did break the law. If you have several tickets, taking a driving course, might help erase points from your record. If a driver picks up a few minor violations a year, most insurance companies won’t factor them into the renewal rate.

As always, we stand ready to offer our professional advice.

Oct 08
Love0

FIVE INSURANCE MISTAKES THAT CAN THREATEN YOUR MARRIAGE

By Personal Perspective

Because relationships can be complicated – and insurance almost always is – when the two intertwine misunderstandings often lead to insufficient coverage, as well as marital distress.

To help maintain financial and emotional harmony in your marriage, avoid these errors:

  1. Failure to admit bad credit before marriage. Credit issues have a long reach in a variety of ways, such as setting auto insurance rates. Ask how your score will be used and whether both spouses’ credit will be reviewed.
  2. Not naming a spouse as the beneficiary under your life insurance. If there’s no beneficiary and no will, he or she might receive less than half of the benefit. If a life policy is part of a divorce agreement, tell your new spouse.
  3. Trying to save money on auto coverage by not listing your bad driver spouse on your policy. This can lead to denied claims, policy cancellation, and even prosecution for fraud. Because most auto insurance companies offer multiple discounts, you might pay less with a joint policy.
  4. Failure to insure your home and valuables properly before a fire or other catastrophe causes significant damage. Cover your dwelling for its full replacementcost. If your possessions have value, either sentimental (wedding rings) or real (antiques, fine arts, etc.) they’ll need to be insured.
  5. Letting insurance lapse for non-payment. If you’re the spouse who pays the bills, make sure you do your job. If your auto or homeowners policy lapses, you won’t be covered. Even if you don’t suffer a major loss, you’ll need to re-apply and might have to pay more for less coverage. Be aware of grace periods for insurance payments, which vary by state and type of policy.

For a complimentary, comprehensive review of your insurance give us a call.

Oct 08
Love0

REPORTING INSURANCE SCAMS: IT’S THE LAW!

By Personal Perspective

As you go about your daily business, insurance fraud is probably one of the furthest things from your mind. However these all-too-common scams, everything from homeowners who report a non-existent burglary to collect on their policies to drivers who stage auto accidents and file injury claims – are criminal acts that you have a legal obligation to report.

If you’re aware of, or suspect, a fraudulent act that involves insurance follow these steps:

    • Inform the insurance fraud bureau in your state either through its telephone “hot line” or online.
    • Contact the fraud department of the insurance company involved. Most companies have hotlines for this purpose. If a fraud hotline isn’t available, or if you’re uncomfortable using it, write the fraud department instead.
    • If the alleged fraud involves a medical issue – such as a claim for a non-existent condition – contact your state medical board or chiropractic board immediately in order to protect the complainant, as well as other possible victims.
    • If appropriate, notify other authorities, such as the police (if someone’s life might be in danger) or your local Social Security office (in case of suspected Social Security fraud).
    • Remember that, as a witness, you must report all the details involved: full names, dates, organization, company name, the amount of money involved, etc. Provide any documentation or other information you think might help with the investigation.
    • Be patient. Investigating complaints takes time; it might be months before the investigators have gathered enough evidence to bring the perpetrators into court.

A word to the wise. insurance scams costs billions of dollars a year, driving up premiums for everyone – including you.

Oct 08
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AVOID STICKER SHOCK FOR YOUR TEENAGE DRIVER

By Personal Perspective

Adding a teenager to your auto policy can raise your rate by more than 40%. The good news: you and your teen can reduce these hikes significantly in a variety of ways:

  1. Get good grades. Most insurance companies offer high school or college students with a B average or better a discount of up to 10%.
  2. Live away from home. Students at college or living at least 100 miles from their parents without a car can usually get a 5%-10% discount.
  3. Take an additional driving class. Although most insurance companies don’t give a discount for mandatory drivers’ed instruction, some companies will reduce premiums by 5% for teens who go to follow-up classes.
  4. Sign a parent-teen driving contract. Your insurer might offer up to a 5% discount if your teen agrees to follow such rules as not driving at night or with friends in the car.
  5. Raise your deductible. However, bear in mind that you’ll have to pay this deductible if your teen driver damages the car. If you repair every ding, you could spend a lot more than you’ll save on premiums with a higher deductible.
  6. Reduce or drop some coverage. If you have an older car, you might not need Comprehensive or Collision insurance. Be wary of lowering Liability limits. In most cases, it makes sense to keep Personal Injury Protection (PIP) coverage, which pays medical expenses of anyone injured in an auto accident.
  7. Choose a safe vehicle. The higher the safety rating of your car, the lower your premiums – and the safer your teenager will be behind the wheel.

We’d be happy to help you minimize the sticker shock of adding a teen driver. Just give us a call.

Oct 08
Love0

DON’T LET DOMESTIC VIOLENCE COME TO WORK

By Risk Management Bulletin

Thousands of workers suffer abuse at home and, all too often, this violence spills over into the workplace. According to the American Bar Association Commission on Domestic Violence, there are 30,000 to 40,000 incidents of on-the-job violence a year in which the victims knew their attackers intimately. More than seven in ten (71%) human resources and security personnel surveyed have seen domestic-related violence at work.

A violent episode on the job can endanger co-workers, as well as the victim. What’s more, female workers abused at home have higher rates of absenteeism, drug abuse, and depression that increase health insurance costs and lower productivity – costing businesses more than $4.5 billion a year.

The law requires employers to provide all employees with a safe workplace. Failure to act on the knowledge that domestic violence could threaten workers makes your business legally liable.

In deciding whether an employee might be a victim of domestic violence, beware if the worker:

  • has unexplained bruises that don’t fit their injuries
  • wears inappropriate clothing that might be covering up injuries
  • seems distracted, anxious, upset, or depressed
  • has a high rate of absenteeism
  • receives repeated, upsetting telephone calls

If you notice any of these signs, talk to the employee privately, expressing concern about possible abuse. Be supportive and keep this information confidential, except for individuals who need to know, such as security personnel. Offer company and community support and be flexible with the employee’s working arrangements.

According to the Family Violence Prevention Fund, supervisors are usually the first people to become aware of an employee who might be a domestic violence victim. Supervisors should refer potential victims to the Employee Assistance Program or a community domestic violence program. The National Domestic Violence Hotline number is (800) 799-SAFE (7233).

A word to the wise!

Oct 08
Love0

CHECK OUT THIS SOCIAL MEDIA USE CHECKLIST

By Risk Management Bulletin

Social media rules! In 2012, Twitter, Facebook, and Tumblr users sent tens of millions of messages every day– and new players keep entering the marketplace. Although these platforms provide significant benefits for businesses of all sizes, they also pose a variety of risks. Everything from employment, privacy and security, through intellectual property to media-related liability.

Chances are your employees are using social media, either at home or work, in ways that could put your business at risk. To limit this exposure, experts recommend creating social media guidelines based on a five-point checklist:

  1. Assess both your company’s general social media activities and individual social media campaigns, weighing potential risks against benefits as accurately as possible.
  2. Designate specific individuals and departments to develop, execute, and monitor a comprehensive and proactive social media strategy – and make a senior executive responsible for implementing it in a timely fashion.
  3. Have the policy reviewed by the relevant departments (human resources, IT, communications, and legal) and by an outside law firm.
  4. Because employees pose the biggest risk to a company, although often unwittingly,,provide educational programs about the danger of damage to the company by using social media on the job or at home.
  5. Create a social media agreement for employees to review and sign as a condition of employment and part of their employment contract. Update the agreement annually, or as often as needed, to address changes in social media that might impact your risk in new ways.

Following this checklist will help position your business to reap the enormous benefits that participationin social media offers.

As always, we’re here to help you– just give us a call!

Oct 08
Love0

BUSINESS CONTINUITY PLANNING: A THREE-STEP APPROACH

By Risk Management Bulletin

Every business is vulnerable to disruptions. Most companies have taken steps to mitigate the impact of major hazards. However many businesses have neglected smaller, more probable perils, ranging from inadequate fire protection and offsite data backup, through the death or disability of key personnel, to over-reliance on a limited number of vendors.

While you can transfer many risks that could disrupt your business to insurance companies (through such coverages as Business Interruption and Extra Expense policies), this probably won’t be enough to ensure that the company will survive or continue its long-term growth and profitability. To prevent and/or reduce the impact of such a mishap, it makes sense to implement Business Continuity Planning (BCP). This process involves three key steps:

  • Pre-disruption planning. Assess the “risk and threat environment” of your business and take steps to reduce these hazards and weaknesses.
  • Disruption response. The extent and nature of losses will depend on the effectiveness of the emergency plans that you implement during the incident to provide a methodical, rational, and coordinated approach to dealing with the disruptions.
  • Post-disruption recovery. While the first two steps can reduce or mitigate risk, the recovery process focuses on rebuilding and restoration. Although many businesses depend heavily on central and distributed computer resources, a comprehensive BCP involves a wide variety of crucial activities that need to continue with minimal interruption.

Your BCP should not be a one-time project that involves creating a plan and then moving on to “business as usual” – but a long-term commitment to design, develop, implement, and maintain a comprehensive, company-wide strategy to keep your business running effectively..

We’d be happy to review the risks facing your business and tailor a Business Continuation Plan to your needs.

Oct 08
Love0

RISK MANAGEMENT: THINK LIKE AN UNDERWRITER

By Risk Management Bulletin

Chances are that you outsource most risk management functions to an insurance company representative or agent. However, to protect your business against the risks you face at a price you can afford, you need to control the presentation of your loss and coverage information to insurers. In other words, it makes sense to provide what an underwriter needs to write your business: a “risk profile” that shows a historic record of your exposures, loss data, and insurance contracts.

Your profile should include these items:

  • A history of the firm that’s positive and realistic. The more effectively you’ve adapted to the recession, the better your chances of getting a competitive rate.
  • Résumés of key management— to show that you and your team know your business.
  • Marketing materials and Web page(s).
  • A D&B Report. Without one, you might get a lower grading. If you’ve had financial problems, some insurance companies might be willing to write your business, as long as you provide this information upfront.
  • Audited financial statements, if applicable.
  • Estimated values, including sales, workers compensation payroll, automobile fleet, property and equipment.
  • Sales and payrolls for the past five years.
  • Insurance loss runs and claim runs during the past five years for all policies, valued within 90 days of renewal.
  • An outline of your workplace safety plan(s).
  • Fleet maintenance schedules, if applicable.
  • Your workers compensation experience modification factor.

Be sure to review all data on your company in the files of your insurance company and add it to your database.

Maintaining a comprehensive, accurate, and updated risk profile, and staying on top of how you present this information,will play a key role in securing a comprehensive and cost-effective insurance program.

Our risk management specialists stand ready to offer their advice at any time.

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