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Insurance? Not today

12-31-2008by Colleen King

Health Insurance, life insurance, annuities, long term care insurance–okay, my usual topics are in. But today’s article is not to talk about insurance, I just want to wish everyone a Happy New Year.


2008 was a lousy year for many people, so kick it to the curb and get ready for 2009. As far as insurance, we’ll see what actually changes in the health care arena. It won’t be fast or ‘all curing’ but I hope there will be some positive action. 


Especially if it doesn’t mean me losing my source of income! 


So, I wish you all a Happy NYE, and we’ll be ringing it in from the Caribbean. Hope that bodes well for smoother sailing in 2009! I look forward to answering your questions again…..


Be well!

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Group Health Insurance and when your renewal comes around

12-26-2008by Colleen King

Wow–time got away, and I’ve posted nothing in December! Other than the usual holiday stuff keeping me busy, I also had several group health plan clients whose renewals are coming up January 1st. My advice to you when your group health insurance renewal comes around is to attend to it early on, and not wait until the last minute when possible. Here’s why.




(Merry Christmas from my partner on the right, Aidan, and his gal pal Siobhan. I’m sure you know the other guy)


About 6-8 weeks before your anniversary date, you and your agent will get the next year’s rates for your group health plan. What I tell my clients is that we’ll look them over, and when you get over the inevitable sticker shock, I’ll research what else is out there so see if it makes sense to make a change in plans, either within the same carrier or to change carriers.


If you change plans within the same insurance carrier, the paperwork is usually pretty light. But if you are changing carriers, you are starting from scratch so all new paperwork needs to be submitted. When you go through this process close to the renewal date, there is always the concern that something may be missing, delaying the implementation of a new plan. And if you have a January 1 renewal date, believe me, things slow down at the insurance companies because of the Christmas and New Year holiday time off.


Group health insurance renewals are also the time to add new employees. If this process is completed after the first of the month and they need care, there can be hassles in their obtaining care because the insurance company doesn’t know your employee is eligible.


Even though I’m emphasizing January 1 renewals in this article, it applies to renewals at any time of the year. Since money is tight for most companies, talk to your agent about less expensive plans to see what might be possible. You’ve got better things to spend money on than health insurance of course, but keeping a group health insurance plan goes a long way to recruiting and retaining good employees,


Have a wonderful holiday season, and a fabulous 2009!


Be well!

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Health Savings Accounts–One Account or Two?

11-16-2008by Colleen King

Health Savings Accounts (HSAs) are a great way to handle health care coverage for many people. In order to have one you need to have a specific type of health plan, referred to as a Qualified High Deductible Health Plan (HDHP). In order to qualify as an HSA eligible HDHP in 2008, plans for a single individual must have a the deductible of at least $1100 and the only benefits available prior to meeting the deductible are preventive services. For a family plan the minimum deductible in 2008 is $2200.




But the question I want to address in this article is one aspect of setting up the actual HSA. When a family has an HSA eligible plan, should they set up one HSA or two? Well, when you set up an HSA for your family there can only be one account holder listed, but the money in the account can be used for all members covered by their family health plan. In 2008 the maximum contribution for an individual is $2900 and for a family is $5800. So, no big difference at this point whether you need one account or two? Maybe if you file your taxes separately, you could each use the deduction of what you’ve contributed during the year.


Here’s where the potential benefit comes in; after age 55, people with HSAs are eligible for ‘catch up’ contributions! In 2008, that would be an additional $900. If you have one account, there can only be one catch up contribution. But if you and your spouse have separate accounts, you could both take advantage of the catch up contribution. So,with a family HSA allowable contribution of $5800 (if you choose to make the maximum contribution) plus $900, that would give you $6300 in the account. With separate accounts you could each make the maximum contribution of $2900, plus $900, times 2, giving you a total of $7200 that you could put away. Something to think about!


Every year these numbers are adjusted for the coming year; see below for the HSA numbers for 2009:


Maximum HSA contribution–individuals $3000, families $5950

Catch up contributions for account holders over age 55–$1000

Minimum health plan deductible–individuals $1150, families $2300

Maximum out of pocket max on a plan–individual plans $5800, family plans $11,600

Whatever you do, you need to have health insurance these days. HSA eligible plans can be less expensive than conventional PPO plans and you are basically are ‘self insuring’ for the smaller issues. Look at it further to see if it’s a fit for you.


Be well!


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Medicare open enrollment–need a change?

10-28-2008by Colleen King

Medicare–the golden years–woo hoo! You finally have your red, white and blue card, health care until you ‘no longer need it’ is now taken care of. But are you okay with your current situation? Medicare alone does not cover 100% of everything so most people pick up additional coverage, which I will go through below.



Medicare Supplements and Medicare HMOs, also known as Medicare Advantage plans, are something to choose wisely. This is because as time goes on, like with regular insurance plans, benefits change and what you chose originally might not be working for you now.


November 15 through December 31 is Medicare open enrollment every year, and if  you have a Medicare Advantage/Medicare HMO plan and you aren’t happy, or your doctor is no longer accepting the plan, NOW is the time to make a change and you don’t have to go through medical underwriting to be accepted.


Medicare Supplements don’t have quite as liberal rules around changing, but there are ways of doing it. BUT, generally you will have to be able to go through underwriting screening and be accepted. And that’s usually the problem. When you initially become eligible for Medicare, you have a six month window (three months before and three months after your birthday) to enter any supplement plan that you want. No underwriting. You can be a medical train wreck and they will still take you. However, if you have a supplement and it’s become too expensive, you can make the change to an HMO plan during the annual open enrollment period.


In Los Angeles County, and several other counties in California, the Medicare HMOs (aka Medicare Advantage plans) are free, so if money’s getting tight a Medicare HMO might be a good solution to your situation. If you are having trouble navigating the coverage waters of Medicare associated plans, call your agent. Or me; I’d be glad to help you figure out your options.


Be well!

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Long Term Care insurance–at what age should you buy it?

10-18-2008by Colleen King

Long Term Care insurance is going to be an essential part of your financial/retirement planning portfolio, because despite what you may think, the government is not going to take care of it. They’re struggling now to do what they are supposed to, and it doesn’t look like it’s going to get better anytime soon.


Many people think this is something you get in your late 60s or early 70s. You can, but the problem is that rates are significantly higher at that point, and there’s always the risk that you may have developed something rendering you uninsurable.






The time to really start looking is in your late 40s or in your 50s.  Reasons why:


Rates will be lower; for with each birthday, the rates will go up.

When you have no health conditions, you may qualify for a 10% ‘preferred health’ discount with most carriers. That can add up to worthwhile savings.

If you are married and you both apply there is usually about a 25% spousal discount. So you buy two policies for about 25% less each! Unfortunately, as we know, once you hit the ‘older years’ you risk one spouse possibly passing away and you lose that possible discount. Or, one of you may not qualify for coverage, so you lose the spousal discount possibility.

Case in point–I recently had two requests for quotes. My initial presentation was for a $170/day benefit, 5% compound interest inflation protection, a 3 year benefit period, and a 90 day elimination period. One lady was 52, the other was 72.  Standard rate, without any discounts, not taking into consideration the possibility of a preferred health discount. The 52 year old woman’s rates per year were $2329/year. The 72 year old woman’s rates were $7800/year! And those were the least expensive rates from the three companies I queried.


So even though $2300+ a year is not cheap, long term care costs in California at this time can be as much as $80,000 per year, or more. Compare $2300 vs. $80,000. All of a sudden, it seems manageable doesn’t it?


Also, while carriers won’t guarantee it, the majority of the time carriers will not raise rates on existing policies. So locking in that $2300/year could be helpful in a few years as you are looking to retire and your income is going down.


So at least do some checking; you can’t make a good decision without good information. If you have an agent you trust, get a quote or if they don’t sell long term care insurance, ask for a referral to an agent that does. And if you’re in California, I’d be glad to help you.


Be well


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