Group Health Insurance
Health care reform
Health Savings Accounts (HSAs)
Individual Health Insurance
Long Term Care Insurance
Medicare related coverage
10-09-2008by Colleen King
I recently heard this statement at a sales training session, and it’s become my new mantra. Health insurance and most other types of insurance for that matter, can be really expensive and now’s not the time to be absorbing rate increases.
Even though I sell insurance for a living I don’t like to see people pay more than they need to. That doesn’t mean the least expensive coverage is the best way to go either. But there is a happy medium often times.
Life insurance rates overall have come down over the past few years so if you purchased life insurance more than 4-5 years ago, it might be time to see if there is something less expensive for you. Why not? You also have to see if what you have is sufficient. If you’ve had another child or two since you last bought a policy, it’s time to make sure that is still okay.
Long Term Care insurance–well, none of us are getting any younger, so if you are in your late 40s and up, you might consider at least learning about it. Maybe get a quote too. The old thinking was that this is something you buy in your late 60s, early 70s. By then, rates can be at least double what they would be in your 50s. Plus there’s the risk of developing a health condition that could either keep you from getting a 10% preferred health discount or rendering you uninsurable in general.
Annuities–see my September 30th post on annuities. They can be a great move in this economy if you don’t need the money right away and there aren’t enough antacids in your house to withstand the stock market volatility.
So don’t participate in the recession. If you are a business owner, you still need to market. Those that stop, their businesses don’t grow. You might not grow as much, but growth of any kind is good right now.
Be Well!...read more
09-30-2008by Colleen King
Can it get much crazier? If you’ve never considered an annuity for anything before, you should consider it now.
An annuity is actually an insurance product that gives people a guarantee on their investment. At least the fixed annuities and fixed indexed annuities do. The stock market is a scary place to have your money these days, especially if you saw the Dow drop nearly 800 points Monday! It didn’t plummet that much after 9/11, which doesn’t make me feel very good.
Annuities are life insurance products that guarantee your principal. Fixed annuities will make the commitment. The variable annuities won’t, as they are directly invested in the stock market. If you are in your 20s and 30s, you may not mind the loss because you have time to make the money again or wait for the market to rebound. Not that it did after the mess of 2000, but it could.
But if you are in your 40s and up, we baby boomers aren’t going to have the time to re-save. I’ve moved a good part of my money into annuities over the past 3-4 years. There are different kinds, with different time frames, it is not a one size fits all product. Talk to your insurance or financial advisor to see if this if an annuity might be a suitable direction for you to go. I use them for people that have left jobs and don’t want to leave their 401k or 403b behind. But they don’t have the stomach for the stock market. The other plus on this is that when you leave an employer sponsored retirement plan is that you will be starting an IRA. The main reason to move your old retirement plan is that if something happens to you, ODDS ARE THAT YOUR BENEFICIARIES WILL GET THE ENTIRE AMOUNT AT ONCE! Talk about ugly tax consequences.
By moving it into an IRA, whatever the vehicle, an annuity or whatever, you and your beneficiaries retain control and the money can be taken out over time. This is referred to as a ‘stretch’ IRA and you need to know about this.
If you are concerned about the stability of insurance companies, especially after AIG being ‘bailed’ out, or rescued, or ‘whatevered’, what you need to realize is that the insurance segments of AIG are sound. There are reserve requirements of 103% of the face value of policies that must be held, not flying around. What got them in trouble was poor investing by their other business units. Remember, in 1929, the banks went under. The insurance companies held strong.
So take a deep breath and hang on. It’s going to be a bumpy ride!...read more
09-25-2008by Colleen King
Health Insurance is treated differently by people as opposed to homeowners or auto insurance, because unfortunately we tend to need to use it more often. Individual health insurance plans generally over 70% (or less) after you meet the deductible. So until you hit the out of pocket maximum, which is like a stop loss, your 30% adds up. Thank goodness for the out of pocket max, because that’s the part that keeps you from going broke, or paying that 30% forever.
I was asking my business partner about these in light of the current economy. His only response was on the economy, and to quote him, ‘Ruff” (see picture at the bottom of this post). Supplemental insurance can be sold in a few ways, and whether or not it makes sense depends on your personal philosophy on insurance. And yes, some people outside of this industry have insurance philosophies. These are plans you will hear about that provide extra coverage for cancer, accidents, hospitalization, critical illnesses such as strokes and heart attacks.
These may be helpful to you, but you really need to evaluate the cost versus what you get, IF you have an occurrence. The main thing that bothers me about the way I hear a lot of agents sell them, and only sell supplements, is that they describe them as ‘paying you money for what your main health insurance doesn’t cover.’ It often sounds like they make up the entire difference, and they don’t generally.
They don’t coordinate with your main insurance most of the time. They send you the specified amount after you file a claim if it meets the criteria. Then it’s up to you, if you spend it on non-medical expenses, which could be helpful, or you use it to pay medical costs.
Some employer groups will offer these to employees at the employees’ expense to enhance the benefit package. Depending on what you buy, it could be paid on a pre-tax basis, which is good for the employer and the employee. Before you go forward with it, ask the following questions:
Is there a limit to the number of times I can file a claim?
Will the rates ever go up?
What does this cost each month, and what is the potential payout?
These are just a few of the questions you need to ask. These types of plans are mostly offered in conjunction with group health insurance, but some can be offered on an individual basis. Wherever you are buying it, make sure you understand what you are getting and keep asking questions until you are satisfied.
Of course, there is always the alternative–Be well!...read more
09-16-2008by Colleen King
Health insurance tends to be confusing to most people, so going to a big, national web site to decipher what all is available might be okay for some. If you really understand it, then go for it. I can understand wanting to do it on your own and not risk being pressured into buying more than you want.
However, whether you are looking for an individual plan for you and/or your family or a group health plan, if this isn’t your forte, seriously consider using an independent agent. I’ve dealt with several people during my time in business that had gone to a major site to pick their own, then they were unhappy with it. There are several things that can be phrased in different ways, and if you don’t know all the nuances you might end up with something other than you thought. Many of these huge national sites also have agents available by phone you can call for help, but from what some of my clients have told me, trying to get the same person a second time especially if it’s a couple of months or more after you bought the policy can be tough.
By going to an independent agent, whether they are down the street or just established with a private agency in your state, if you have selected a good agent, they will be there if down the line you have a problem. I tell my clients that I don’t disappear after a sale, that I remain available to them in case there is an issue. I also tell them that I return phone calls usually the same day. That may sound like pompous horn blowing over a dumb little thing, but it you’ve ever had an agent evaporate on you, you’ll agree that it’s not.
I also tell my clients that I ‘do the shopping’ for them. On my web site I post the pricing and benefits of all the available carriers that I represent. So you could certainly go to my web site, find information, select a plan and apply online without ever talking to me. But I like to talk to people, so if you do go to my web site, let’s talk about what you have found and see if it will really fit what you are looking for. I look at the nonsense of individual health insurance and group health insurance plans day in and day out, so sometimes I can point out small things you might have missed. My goal is to help people find what fits their needs, not mine, and frequently I talk people down in price, spending less than they would have on their own.
Sometimes people think that by going to a carrier (insurance company) directly, then can save money. My services and those of any other independent agent, are free, whether you end up buying from us or not. We are paid by the carrier we place the business with. So our consultative services work for you–you don’t have to call a bunch of carriers to see what’s available, because I promise you–they all think they have the best thing going and it’s not always true. They won’t tell you about the ‘comparative pitfalls.’ So deal with an independent agent, and get objective information on your plans.
We also know about the subtle differences between carriers when it comes to underwriting health issues. They don’t tell us everything, because honestly, with some agents that would be like giving away the answers to the quiz. But there are some carriers that are certainly easier to work with than others.
So use our expertise and willingness to help you if something goes awry–Be well!...read more
09-10-2008by Colleen King
Life insurance is life insurance, right? Many times yes, but with the right type of life insurance your mortgage will be protected in a way that affords your survivors more options.
Have you gotten a mortgage or refinanced a loan lately? About 20 minutes after the close, you started getting things in the mail offering crucial, vital protection that was absolutely essential to your existence and the existence of your family as well the continuation of liberty and freedom in America. Geez, when you put it that way……..
Often is it offered by an affiliate of the company you did your loan through, but also insurance agencies that do this type of coverage buy information and seek out public records when a new loan or re-fi closes. The idea is that you fill out the card, mail it then get a call to set an appointment. You can do that and meet with the agent, but there are some definite questions you need to know to ask.
Generally what is being offered is called ‘decreasing term’ life insurance. What you are buying is a term policy that is meant expressly to pay off your mortgage, it’s not a fixed, static amount. So, as your mortgage balance decreases, so does the amount the policy will pay if you pass away. If you are buying with a spouse or partner and you both apply, you are really paying two premiums and getting one policy, with a death benefit that decreases over time. AND, if you sell your house, usually the policy is attached to the house so you end up starting over if you are buying another home.
What about this scenario–one of you is working, the other isn’t. The working spouse dies. You have other bills, and now a loss of income. What do you do? Well, the decreasing term life policy will pay off your mortgage, but what about other expenses?
By using a regular term life insurance policy, either 20 or 30 years, you control what happens to the money. You can now address other bills and have a financial cushion. Maybe you do want to pay off the house, and you can, but what if you are now going back to work and would like the mortgage interest expense as a deduction? This is one of the things I mean by having control over your situation. If two people are insured, you have two level premium death benefits (meaning the value doesn’t drop over time). And if you move, the policy goes with you.
Optimally, you look at an amount that will pay off the mortgage, put all kids through a four year college program and take care of a majority of the remaining partner’s living expenses. That can end up being expensive, and you don’t want to buy insurance that breaks you. Once we look at rates, then we go ‘backwards’ and see what death benefit amount is affordable. After all, having something is better than nothing, because it will give your survivors time to grieve and deal with things. And not have to make difficult financial decisions at a terrible time.
Some people if they are younger will opt to add on a ‘return of premium’ rider. If you are alive at the end of the term of the policy, they will return 100% of the premium to you. No interest of course, but at least you get it back. Agents are divided on whether this is a good thing to recommend or not. I suggest it, but don’t push it, because ultimately my clients are calling the shots.
So basically, when you have people depending on you financially, whether you want to call this mortgage protection, life insurance or just good old peace of mind, seriously consider looking at it. Be well!