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What
is Vision Insurance? (Contact
a Sales Associate for a quote)
Vision insurance provides coverage
for services relating to the care and treatment of the eyes.
It typically covers services delivered by an optometrist
or ophthalmologist. Depending on the specific plan, some
or all of the following services may be covered:
- Yearly eye exams - Glasses (with an annual limit)
- Contact lenses and fitting
(with an annual limit)
- Glaucoma screening
Some vision plans may provide more extensive coverage
(such as certain eye surgeries), while others may limit coverage
to "reasonable and customary" charges
incurred during routine eye exams. Reasonable and customary charges generally
do not include the cost of glasses and contact lenses.
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What
is Short Term Disability Insurance? (Contact
a Sales Associate for a quote)
An injured employee is worried about
many things, including surviving without a paycheck. If the
accident happened off the job, Worker’s Compensation
will not cover it. If an employee has to rely on their personal
savings, research shows this will last on average just 4.8
weeks. An insured Short Term Disability plan can replace up
to 100% of the income lost due to injury or sickness. Focusing
on short term disability is the first step to gaining control
of overall disability costs. A well-managed STD plan can help
an employer identify, track, and handle claims professionally
and consistently. Active claim management, through a fully-insured
plan, can help shorten the duration of disabilities through
rehabilitation and return-to-work efforts, reducing your costs
and preventing short term disabilities from turning into long
term ones.
FAQs:
Q: Will our Worker’s Comp cover short term claims?
A: 62% of disabilities occur off the job. These are not covered by Worker’s
Comp.
Q: Doesn’t State Disability pay for short term
disabilities?
A: Yes, but SDI only pays 55% of income up to $334 per week. An STD plan
can be designed with higher percentages and maximums to replace a larger
amount of income. The STD plan will pay on top of SDI to these higher amounts.
Q: Does an insured STD plan cover pregnancies?
A: Yes, pregnancies are covered as any other disability.
Q: How often do short term disabilities occur?
A: The average occurrence of STD claims is 65 per 1,000 insured lives per year.
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What
is Long Term Disability Insurance? (Contact
a Sales Associate for a quote)
When faced with a disabled employee,
uninsured employers have few options. Do you continue to
pay all or part of a salary? Offer unpaid leave? Terminate
employment? For an employer and employee, the choices can
be devastating. A Long Term Disability plan will replace
up to 66 2/3% of an employee's income up to the age of 67
in a situation where catastrophic illness or injury exists.
A managed LTD plan allows an employer to outsource the difficult
decisions surrounding a disabled employee to disability experts.
Along with income protection, most disability plans offer
rehabilitation and return-to-work services that are essential
to the recovery of disabled employees. The goal of Long Term
Disability insurance is to financially protect and proactively
return disabled employees to a productive life.
FAQs:
How many people really use their LTD plan?
There is a 1 in 5 risk that a 35 year old will be disabled for 90 days or more
before age 65. You are more likely to become disabled than to die during your
working years.
How much will LTD cost the company?
The general rule is that a fully insured LTD plan will cost a company about
one half of one percent of the company's monthly payroll.
Will an LTD plan pay a disabled employee who returns to work
on a part-time basis?
Yes, most LTD plans will pay an employee who is limited from performing all
of their job functions, and has suffered a 20% or more loss of income as a
result.
What are the most common income replacement percentages?
Most companies implement a plan that replaces 60% or 66 2/3% of an employee's
income in the event of a disability. The highest percentage available is 66
2/3%.
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What
is a Short Term Health Insurance Plan? (Contact
a Sales Associate for a quote)
Do you need some health insurance for
just a couple weeks or a couple of months? In most cases,
we can get you covered the same day you apply.
There are Two Types of Short Term Health Insurance Plans:
1. Choose the length of time you want coverage for -- from 30 to 185 days
2. Receive continuous coverage month to month for up to 12 months
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What is Medicare Supplement Insurance? (Contact
a Sales Associate for a quote)
It is medical insurance coverage sold
on an individual basis which helps to fill the gaps in the
protection provided by the Medicare program. Medicare supplements
cannot duplicate any benefits provided by Medicare, but may
pay part or all of Medicare's deductibles and co-payments,
and may cover some services and expenses not covered by Medicare.
For more
information about Medicare.
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What is Life Insurance? (Contact
a Sales Associate for a quote)
Life Insurance is insuring against the
death of a particular person, the insured. Upon their death,
while the policy is in force, the insurance company agrees
to pay a stated sum or income to their beneficiary.
What is Term Life Insurance?
Term Life Insurance is a low-cost form of life insurance that stays in effect
for a specific period of time. If the insured dies during the coverage period,
the beneficiary will receives the death benefit. If the insured survives the
specified time period, the policy expires and the obligations terminate. Term
insurance works best when the coverage is needed for only a specific period of
time or near-term cost is an overriding factor. In early years, term insurance
costs are less then a Whole Life or other cash value policies. Term insurance
becomes increasingly expensive as the insured grows older.
What is Whole Life Insurance?
Whole Life Insurance is life insurance that is kept in force for a person's whole
life as long as the scheduled premiums are maintained. All Whole Life policies
build up cash values. Most Whole Life policies are guaranteed as long as the
scheduled premiums are maintained. The variable in a Whole life Policy is the
dividend which could vary depending on how well the insurance is doing. If the
company is doing well and the policies are not experiencing a higher mortality
than projected, premiums are paid back to the policy holder in the form of dividends.
Policyholders can use the cash from dividends in many ways. The three main uses
are: it can be used to lower or eliminate premiums, it can be used to purchase
more insurance, or it can be used to pay for term insurance.
What is Variable Life Insurance?
Variable Life Insurance is a form of whole life insurance under which the death
benefit and the cash value of the policy fluctuate according to the investment
performance of a separate account fund. Most variable life insurance policies
guarantee that the death benefit will not fall below a specified minimum. A minimum
cash value is seldom guaranteed. Because the policy owner assumes investment
risk under variable life insurance policies, these products are considered securities
contracts. In the United States, variable life insurance policies must be registered
with the Securities and Exchange Commission (SEC), and only agents who have passed
the National Association of Securities Dealers (NASD) examination may sell this
product.
What is Universal Life Insurance?
Universal Life Insurance is a flexible premium life insurance policy under which
the policy owner may change the death benefit from time to time (with satisfactory
evidence of insurability for increases) and vary the amount or timing of premium
payments. Premiums (less expense charges) are credited to a policy account from
which mortality charges are deducted and to which interest is credited at rates,
which may change from time to time.
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What
is Section 125 Cafeteria Plan?
(Contact
a Sales Associate for a quote)
Also known as Flexible Benefit plan,
Section 125 plans allow employees to pay for certain benefits
with pretax dollars. This allows them to save taxes on insurance
premiums, out of pocket health care, and or related child
or dependent care expenses. Any dollar the employee defers
into the flex plan is withheld before any taxes are calculated.
The employer will save their portion of social security tax,
Medicare, payroll and any other state-required taxes.
The employee may elect to participate in any of three accounts. Federal, State
and Social Security taxes are saved on every dollar contributed to the plan.
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PREMIUM ACCOUNT allows employees to pay their
group insurance premium contributions pretax, increasing their
take home paycheck;
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HEALTH CARE SPENDING ACCOUNT allows employees
to use pre-tax monies to cover deductibles, co-pays and other
non covered expenses;
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DEPENDENT CARE SPENDING ACCOUNT allows employees to save
taxes on child or dependent care expenses.
FAQs:
Q. What is a Section 125 Plan?
A. Section 125 is a provision of the Internal Revenue Code that allows employees
to pay their share of the cost of certain group insurance benefits, unreimbursed
medical expenses, and dependent care expenses with pre-tax dollars. Under this
provision, your paycheck is reduced by the amount you elect for the year. That
money is removed from your salary structure before Federal Income, State Income,
and Social Security taxes are calculated, and placed in a separate account.
This results in lower taxable income, and higher
take-home pay.
Q. What pre-tax accounts are available to me?
A. There are 4 accounts:
• Premium Payment Account
• Medical Reimbursement Account
• Dependent Care Reimbursement Account
• Personal Policy Account
Q. How does a Premium Payment Account work?
A. A Premium Payment Account allows you to have your contributions toward certain
group insurance benefits deducted automatically from your paycheck, before
taxes are calculated.
Q. What is a Medical Reimbursement Account?
A. Under this provision, you elect an annual amount to be taken out of each
paycheck, pre-tax. These funds are available to reimburse you for out-of-pocket
medical, dental, and vision expenses, such as deductibles and co-payments.
A sample list of eligible expenses is provided in this packet.
Q. What is the Dependent Care Reimbursement Account?
A. The Dependent Care Reimbursement Account allows you to pay for your childcare
or disabled adult care expenses while you are working, with tax-free dollars.
Q. What is the Personal Policy Account?
A: The Personal Policy Account allows you to pay for individually owned health
insurance plans with pre-tax dollars, such as your Blue Cross, Blue Shield
or Kaiser plans. Unfortunately, group insurance premiums from another employer
do not qualify.
Q. How do I enroll in the Section 125 Plan?
A: After you have reviewed the plan, and have had your questions
answered, you must complete the enrollment form contained in this package.
Everyone must sign the enrollment form, even if you are declining participation.
To elect to participate in the Premium Payment Account, just check the
appropriate box. If you are enrolling in the Medical Reimbursement, Dependent
Care, or Personal Policy Accounts, you must elect the annual amount to
be withheld from your paycheck, taken in equal increments per pay period.
Q. What is the plan year?
A: Your specific plan year is specified in the Plan Information
Summary. It does not have to be the same as the calendar year, and,
if this is the first year of the plan, it may be shorter than 12 months.
Remember to consider these facts when making your annual elections.
Q. Are there any limits to the amount I can set aside for reimbursement?
A. Every plan is different. Your employer sets the limits on your plan. The
maximum and minimum amounts you can elect are outlined in your Plan Information
Summary included in this package. For Dependent Care Reimbursement accounts,
the law allows you to elect up to $5,000 a year for single, or married taxpayers
filing jointly, and $2,500 for married taxpayers filing separately.
Q. Can I make changes in my election or drop out before the end of the plan
year?
A. The only time tax law regulations will allow you to make a change is if
there is a change in your family or employment status affecting a need for
a benefit. Some examples of status changes are: marriage or divorce, the death
of a spouse or child, the birth or adoption of a child, or a change in pay
or hours of employment for you or your spouse.
Q. Can I switch dollars between accounts?
A. No. The dollars must be used in each account as specified on the election
form.
Q. How do I enroll and use the Medical Reimbursement Account?
A. Determine how much you expect to pay this year for medical expenses that
are not covered by your insurance plan. These expenses could be insurance co-payments,
deductibles, prescriptions, eyeglasses and exams, chiropractic treatments,
dental work, orthodontics, lab fees and special education for a learning disabled
child. Fill in that amount on the form to be taken out of your paycheck over
the year. When you incur an eligible expense, just mail or fax a receipt for
the expense, along with a voucher to Pre-Tax Administrators, and we will send
you a reimbursement check for that amount.
Q. What if I don’t incur enough expenses
within the year to get back the money deposited in my reimbursement
account?
A. Unfortunately any dollars not used for expenses are forfeited.
This is what is known as the "use it or lose it" provision of Section
125. It is very important to be conservative and accurate in estimating
your expenses for the plan year.
Q. How do I enroll and use the Dependent Care Reimbursement Account?
A. Fill in the amount on the enrollment form that you want to have deducted
from your salary for dependent care expenses for the year. That amount will
be divided equally for each pay period, and deducted from your pay. You must
then submit a receipt for those expenses from the provider of the dependent
care to Pre-Tax Administrators, along with the voucher. You must include the
name and tax identification number of the provider, the dates of service, and
the amount paid for the services. The expense will be reimbursed up to the
amount that you have accumulated in your account at that time. The balance
of expenses will be carried over to future months, and additional payments
will automatically be disbursed as funds are available.
Q. Who is considered an eligible dependent?
A: Your dependent(s) under the age of 13, or any dependent
that is physically not able to care for himself is considered to be
a qualified dependent.
Q. Can I use the Dependent Care Account if I pay a family member for childcare?
A. Yes, but they must be reporting that income on their tax return. If that
family member is your own child under the age of 19, you may not claim those
expenses.
Q. Are there any other requirements for using the Dependent Care Reimbursement
Account?
A. Yes. Your spouse must be working, be a full time student, or unable to care
for him or herself.
Q. Can I take tax credit for reimbursed dependent care or medical expenses
on my income tax return if I am in this Plan?
A. No. Expenses reimbursed under this plan may not be used when calculating
your medical expense deduction or the dependent care tax credit. Because for
a few individuals it is sometimes more advantageous to take the dependent care
tax credit on your tax return, than to participate in the dependent care reimbursement
account, you should discuss which alternative is the best for you with your
tax advisor, or the enrollment counselor.
Q. Do I have to file any forms with the IRS?
A: Yes. You must file form 2441, Child and Dependent Care
Expenses, when you file your 1040 with the IRS.
Q. How do I use the Personal Policy Account?
A: This account is used to pay for your individually owned
insurance plans. To participate in this plan, fill in the amount you
will be electing on the enrollment form, and submit a copy of the title
page of your plan, indicating the name of the insured, the policy number,
and the premium amount. When you receive your insurance bill, send
or fax a copy of the bill with your voucher, and we will send you a
reimbursement check for the amount that is in your account at that
time. If there is a balance left on the expense, it will be carried
forward to future months, and reimbursed as the funds become available.
Q. What happens if I leave the company?
A: If you leave the company, your deductions automatically stop. You will be
allowed to submit claims for expenses incurred while you were participating
in the plan. You may submit claims up to the end of the grace period specified
in your plan, usually three months after the end of the plan year. If you want
to continue participating in the Medical Reimbursement Account, you can convert
your plan to COBRA, and continue making your contributions voluntarily after
tax, until the end of the plan year. By converting to COBRA, you can submit
claims for expenses incurred after your termination.
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What is Long Term Care Insurance? (Contact
a Sales Associate for a quote)
Long Term
Care Insurance is coverage that, under specified conditions, provides
skilled nursing, intermediate care, or custodial care for a patient
(generally over age 65) in a nursing facility or in their own residence
following an injury.
What is Nursing Home Insurance?
It is a form of long-term care policy that covers a policyholder’s
stay in a nursing facility.
Statistics on Long Term Care
Chance of auto accident - 1 in 240
Chance of house fire - 1 in 1200
Chance of Long Term Care - 1 in 2
- Underwriter's LTC Council
What are Your "Chances" of Avoiding the Need for Long
Term Care Insurance?
The chance of a catastrophic homeowner's claim is 1 in 1200, catastrophic auto
claim is only 1 in 240 - But the chances of utilizing your long term care insurance
is about 50/50 - like a coin toss! That's why you pay for it, because the chances
of your using it are so high.
Policy Analysis
Long term care insurance evolved from Income Disability insurance. There are
no "cash values", and one pays a periodic premium to renew coverage for the
specific period of time.
When purchasing LTC Insurance you must make three main decisions:
Daily Benefit - the amount of money you will receive from
the insurance company on a daily basis for your care. You usually can select
between $50 and $250 per day. Find out what the current cost of care is in
your area and it will help you make the decision as to what daily benefit you
want.
Benefit Period - the length of time you will receive payments from the insurance
company once you need care. You usually can select a specific number of years
(2, 3, 4, 5,) or lifetime plans are also available. The average length of stay
in a nursing home is 2 1/2 to 3 years. Note: A three year plan will be less
expensive than a lifetime plan.
Elimination Period (deductible) - the number of days that you will
be responsible for paying for your care before the insurance begins to pay.
This works like most insurance deductibles except it is stated in a number
of days instead of dollars. Most plans have a variety of options like 0 days,
20 days, 60 days, or 100 days. Be sure to check if this deductible is once
in a lifetime or if it can repeat.
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What
is Travel Insurance? (Contact a
Sales Associate for a quote)
Travel for business or pleasure, both
domestic and international, involves risk. You may arrive at
your destination to find that your luggage with personal items
has disappeared. A personal emergency may necessitate your
early return home. A medical emergency may require hospitalization
or even air evacuation. In most cases, your existing insurance
will not provide adequate protection for these and other risks.
Without appropriate travel insurance, you may be exposed to
significant financial liability.
International Medical insurance policies are designed to provide health care
while outside the U.S.A. It may also provide additional benefits including, emergency
evacuation and repatriation, accidental death, and limited trip interruption.
Premiums are based upon age, length of coverage, maximum benefits, and deductibles
selected.
Trip Cancellation policies are designed to emphasize protection against Domestic
and International trip cancellations, interruptions, and delays. These travel
insurance plans may also provide additional benefits including among others,
limited emergency travel medical expense and evacuation. Premiums are based upon
age, length of trip and trip cost.
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What
are Wellness Plans? (Contact
a Sales Associate for a quote)
“Wellness
Plans” are the common phrase to describe alternative health
care plans. They include:
• Chiropractic
• Acupuncture
• Naturopathy
• Dietetics
• Fitness Clubs
• Personal Trainers
• Massage Therapy
• Vitamins and Minerals
• Tobacco Cessation
• Weight Management
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