Your Annuity Resource

Insurance Company Annuities Vs Bank CDs: How Do They Compare?

2011-05-12T04:02:00.000-07:00

Comparing Bank CD’s Vs Annuities
Annuities and CDs (bank certificates of deposit) are similar in that they are safe, secure investments with guaranteed rate of returns based on interest rates, both issued by large financial institutions, CDs issued by banks, Annuities offered by insurance companies, but they both possess inherent differences as well.
The big differences are that while Annuities offer everything CDs offer, they carry several advantages.

Generally Higher returns
Tax-Deferral
Liquidity
CDs do have FDIC protection to guard against Bank or banking industry failure, but Annuities also have safety measures put in place by the state to ensure Insurance companies have reserve pools in place. Insurance companies may also be vetted for financial strength by obtaining their rating from objective rating firms — Standard & Poor’s, Moody’s, A.M. Best or Duff & Phelps . The more solid the rating usually equates to a more solid financial backbone of Insurance Company.

Higher Returns:
Annuities, like CDs, are hinged to interest rates. But when rates are low so are CD returns whereas annuities have a minimum guarantee in place, usually 3% or 4%. Your investment will never dip below the guaranteed minimum interest rate during times of falling or low interest rates.

Again, low interest rates mean CD returns will be low as well. To offset the problem of low or falling interest rates, insurance companies equip annuities with guaranteed minimums. This is an agreed minimum rate of interest so that your investment is assured not to fall below the minimum performance even if CD rates do.

Tax-Deferral:
You pay annual taxes on CD interest earned without being able to withdraw funds until your investment term is over. With annuities, there is also a set term, but the earnings are tax-deferred. You only pay taxes on interest earned when money is withdrawn. So with annuities the deferred tax on your interest remains in the investment earning you more and more money, instead of being paid out to state and federal tax agencies on a yearly basis.

Liquidity:
CDs do not allow you to withdraw any monies during term. Period. Annuities have provisions that allow you to withdraw money, generally 10% of your account value annually plus many contracts allow you to remove the earned interest on a monthly basis. Several other contract provisions allow you access to all of your funds such as in the event you are hospitalized, undergoing a life-threatening illness, subjected to a permanent or extended stay in a nursing home, or other major calamities that affect you economically. In addition, annuities can be structured to pay-out for the life of the owner over a fixed term such as five or ten years, thereby spreading out your tax-burden and providing enhanced income security. In short, Annuities offer enhanced flexibility.

Bank CD Annuity
Loan privileges No YES
Flexible premium No YES
Avoidance of probate costs and delays No YES
Withdraw for dollar-cost-averaging opportunities No YES
Withdraw for required minimum distributions, penalty free No YES
Potential Social Security tax advantage No YES
Nursing Home Benefit No YES
“Issue no money” capability No YES
Bonus available on premium No YES
Guaranteed lifetime income option No YES
Potentially high yields No YES
Tax-deferred Growth No YES

Disability Insurance

2011-05-04T04:37:00.000-07:00

Protects your most valuable asset and your ability to earn an income.

Disability insurance pays cash benefits to the policyholder in the event the insured is unable to work due to sickness or injury. That cash benefit ranges from 50% to 70% of income. The insurance company will not pay more than 70% of income because there must be an incentive to return to work.

If you pay the premium the benefits are normally received free from income tax, if the premiums are paid by an employer, the benefits are taxable as ordinary income.
A disability policy is composed of various elements:

Elimination Period - It is the period of time the insured must wait after becoming disabled to receive benefits. Typical waiting periods are 30, 60, 90,120,180, and 360 days. The longer the elimination period the less expensive the policy.
Benefit Period - It is the period of time the benefits will be paid following the elimination period. The benefit period could be from 2 years to age 65 to lifetime. The longer the benefit period the more expensive the policy.
The Amount of Benefit - The larger the pay-out the more expensive the policy. The benefit will not normally exceed 70% of income.
Residual Benefit - Percentage of benefit paid if you return to work and are still partially disabled and cannot return to work full time or cannot earn your full income.
Own-Occupation - Pays a benefit if you are unable to return to your present occupation but can work doing something else. For example, a doctor who is a surgeon, cannot return to surgery but can teach. This is the most expensive type of disability policy.
Reasonable or Any Occupation - Pays a benefit while disabled, but stops when you are able to return to work at a job that matches your education and experience. This policy is less expensive than an Own-Occupation policy.
Occupation - Occupation is a factor used in determining rates. For example, a doctor's rate would be much lower than a blue-collar worker.
Guaranteed Renewable - Guaranteed Renewable policies cannot be cancelled by the insurance company even if a change in the insured's circumstances would make him or her a greater risk. Plus, the insurance company cannot make any changes to the provisions of the policy, or add restrictions. When purchasing an individual disability policy it should be Guaranteed Renewable.
Non-Cancelable - Guarantees future premiums will not be increased. When purchasing an individual policy it should be Non-Cancelable.
Presumptive Disability - Presumptive disability means that you are considered total disabled and eligible for benefits for the loss of sight in both eyes or the loss of two limbs. The better contracts also presume total disability for the loss of hearing in both ears, loss of the power of speech, or the loss of the use of two limbs.
Other Benefits that can be added to an individual disability policy, but could also increase the cost:

Protection Against Inflation - A benefit that can be added that offers a cost-of-living adjustment for inflation during a long-term claim.
Automatic Increase Rider - Automatically increases monthly benefits for a specified period of time. A typical increase is 5% compound.
Future Increase Options - Allows the insured to purchase additional benefit amounts without proof of insurability.
Capital Sum Benefit - Pays the insured a lump sum benefit up to 12 times the monthly benefit if the insured loses the sight of one eye with no possibility of recovery or has a hand or foot severed. This benefit is paid in addition to the other benefits.
Rehabilitation Benefit - To help a disabled insured return to work, this benefit will pay some of the expenses incurred when the insured enrolls in an approved rehabilitation center. This benefit is paid in addition to the other benefits.
Transplant & Cosmetic Surgery Benefit - Under this benefit, any disability arising from donating a transplant organ, improving your appearance or correcting a disfigurement will be covered by the policy.
Types of Coverage

Social Security

Social Security does not just provide for retirement income but disability income as well.

In 2009, the average monthly payment for a disabled worker was $1064; the average monthly payment for a family of a male disabled worker, young spouse and 2 or more children was $1670. See SSI Fact Sheet
Eligibility is based on being unable to perform any gainful employment.See SSDI Disability Planner
You are eligible for benefits after you have been disabled for 5 months and if the disability is expected to last 12 months. See Waiting Period Question
Social Security disability payments are subject to federal income tax if your income exceeds $25,000 individually or $32,000 jointly. See Tax Question
Workers Compensation

Most employers are required to provide this coverage. The amount and duration varies by state. Workers Compensation only pays if the disability occurs on the job, and usually lasts for only a few years and the payments are low.

Individual Policies

For individual policies, the applicant needs to qualify and go through an underwriting process, similar to the process required for life insurance. The applicant could be subject to a higher premium or even be declined based on his or her occupation, medical history, or lifestyle. Individual policies are usually purchased by high income professionals because of the cost.

Group Policies

Some states require employers to carry group disability insurance anywhere from 26 to 52 weeks.

Group Long Term Disability (LTD)

Group LTD is carried by almost half of mid-size to large employers and provides long term benefits for at least 5 years covering about 60% of salary. The premium is usually very low, does not require proof of insurability, and often is fully paid by the employer.

Long Term Care Insurance

2011-05-03T04:28:00.000-07:00

What is Long Term Care

Long Term Care is the assistance individuals need when they are unable to care for themselves and need help with Activities of Daily Living (ADLs) - bathing, dressing, transferring, toileting, continence (control of bodily functions), and eating - or they have severe cognitive impairment such as Alzheimer's disease. The need for long term care can result from an accident, chronic illness or short-term disability, or from advance age. Long term care can include a broad range of services, provided in any setting outside a hospital. It might be help with simple daily tasks like bathing or dressing. It might include skilled care in your own home, an assisted living facility, some other community resources, or a nursing facility.

Who Needs long term Care

19% of Americans aged 65 and older experience some degree of chronic physical impairment. (AHIP, "A Guide to long term Care Insurance", 2004)
About 55% of those age 85 and older are impaired and require Long Term Care. (AHIP, "A Guide to long term Care Insurance", 2004)
By 2020, 12 million older Americans will need long term health care. (AHIP, "A Guide to long term Care Insurance", 2004)
Family and friends are the sole caregivers for 70% of elderly people and most will cared for at home. (AHIP, "A Guide to long term Care Insurance", 2004)
People age 65 or older face at least a 40% lifetime risk of entering a nursing home. 10% will stay more than five years. (AHIP, "A Guide to long term Care Insurance", 2004)
22% of people over age 85 are in a nursing home. (AHIP, "A Guide to long term Care Insurance", 2004)
Women, because they outlive men, face a 50% greater likelihood of entering a nursing home after age 65. (AHIP, "A Guide to Long Term Care Insurance.", 2004)

Some Misconceptions about Medicaid and Medicare

Medicaid

Medicaid pays for health services for the very poor of any age. Qualifications for Medicaid vary by state. Being eligible for Medicaid does not guarantee placement in a nursing home. There may be long waiting lists for facility care. Depending on the state and facility, Medicaid patients often receive lesser-quality care than patients who are paying on their own. Under Medicaid, nursing home care is essentially the only option. Home care, assisted living facility care, adult daycare, outpatient services, and alternate caregiver services are not usually reimbursed under Medicaid.

Medicare

Medicare pays for health care for people 65 and over and for those who are disabled. Medicare does not pay for long term medical service such as assisted living or adult day care. Medicare pays only the first 100 days of skilled care, such as physical therapy or nursing, which only accounts for 5% of all long term care costs. You are eligible for the care only if you have been in the hospital for at least three days. The personal care must relate to the treatment of an illness or injury. Medicare pays 100% for the first 20 days then you pay $128/day for the next 80 days.

Exceptions, Limitations and Exclusions

Most long term care insurance policies will not pay benefits for any confinement, care, treatment, or service(s):

That results from attempted suicide or intentionally self-inflicted injury;
That results from voluntary participation in a felony, attempted felony, or illegal occupation;
That results from a sickness or injury for which benefits are provided under any state or federal worker's compensation law;
Provided outside the United States or Canada;
Provided in a government facility (unless otherwise required by law);
Provided for the treatment of alcoholism or drug addiction, or in facilities operated primarily for such treatment;
Provided in facilities operated primarily for the treatment of mental or nervous disorders or disease, other than Alzheimer's disease or dementia.

Pre-existing Conditions

You could be declined coverage if you already have the following condition(s):

Alzheimer's Disease;
Severe Arthritis with functional limitations;
Diabetes which is not under control;
Cancer within the past 6 months;
Parkinson's Disease;
Stroke within the past 6 months;
A Stroke at any time, which has caused functional limitations;
Congestive Heart Failure within the past 6 months;
Emphysema, if severe or still smoking;
Chronic Obstructive Pulmonary Disease, if severe or still smoking
Any conditions which require the assistance of another human being for the basic activities of daily living: bathing, eating, toileting, or transferring in and out of a bed or chair.

Permanent Insurance

2011-05-01T04:20:00.000-07:00

Permanent insurance provides lifelong protection and is known by a variety of names. These policies are designed and priced for you to keep over a long period of time. If you don't intend to keep the policy for the long term, it could be the wrong type of insurance for you.

Most permanent policies including whole, ordinary, universal, adjustable and variable life have a feature known as "cash value" or "cash surrender value." This feature, which is not found in most term insurance policies, provides you with some options:

You can cancel or "surrender" the policy -- in total or in part -- and receive the cash surrender value as a lump sum of money. If you surrender your policy in the early years, there may be little or no cash value.
If you need to stop paying premiums, you can often use the cash surrender value to continue your current insurance protection for a specific period of time or to provide a lesser amount of protection to cover you for as long as you live if there is sufficient cash value.
Usually, you may borrow from the policy, using the cash value in your life insurance as collateral. Unlike loans from most financial institutions, the loan is not dependent on credit checks or other restrictions. You ultimately must repay any loan with interest or your beneficiaries will receive a reduced death benefit.
The interest crediting rate and therefore cash values of many life insurance policies may be affected by your carrier's future experience, including mortality rates, expenses and investment earnings.
Keep in mind that with all types of permanent policies, the cash value of a policy is different from the policy face amount. Cash surrender value is the amount of available cash when you surrender a policy before its maturity or your death. The face amount is the money that will be paid at death or at policy maturity.

What are the Types of Permanent Insurance?

There are many different types of permanent insurance. The major ones are described below:

Whole Life or Ordinary Life

This was the most common type of permanent life insurance. It was sold by Mutual Life Insurance Companies, however, some stock life insurance companies do offer a derivative product they call Whole Life. It 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 investments and other business criteria of the insurance company are doing. If the company is doing well and the policies are not experiencing a higher mortality than projected, values are paid back to the policyholder in the form of dividends. Policyholders can use the cash from dividends in many ways. It can be used in three main areas: to lower premiums, to purchase more insurance or to pay for term insurance.

Universal Life or Adjustable Life

This variation of permanent insurance allows you, after your initial payment, to pay premiums at any time, in virtually any amount, subject to certain minimums and maximums. You also can reduce or increase the amount of the death benefit more easily than under a traditional whole life policy. (To increase your death benefit, you usually will be required to furnish the insurance company with satisfactory evidence of your continued good health.)(Decreasing does not lower premiums.)

Variable Life

This type of permanent policy provides death benefits and cash values that vary with the performance of an underlying portfolio of investments held in a separate account. You can choose to allocate your premiums among a variety of investments which offer varying degrees of risk and reward. You will receive a prospectus in conjunction with the sale of a variable product.
The cash value of a variable life policy is not guaranteed*, and the policyholder bears that risk. However, by choosing among the available fund options, the policyholder can create an asset allocation that meets his or her objectives and risk tolerance. Good investment performance will lead to higher cash values and death benefits. On the other hand, poor investment performance will lead to reduced cash values and death benefits.
Some policies guarantee* that death benefits cannot fall below a minimum level. There are both universal life and whole life versions of variable life.

Advantages and Disadvantages of Permanent Insurance

Advantages

As long as the necessary premiums are paid, protection is guaranteed* for your entire life or to a specific age / maturity.
Premium costs can be fixed or flexible to meet personal financial needs.(Loans, withdrawals and other transactions may affect the premiums required)
Policy accumulates a cash value that grows on a tax-deferred basis that you can borrow against. (Loans must be paid back with interest or your beneficiaries will receive a reduced death benefit.) You can borrow against the policy's cash surrender value to pay premiums or use the cash surrender value to provide paid-up insurance.
The policy's cash surrender value can be surrendered -- in total or in part -- for cash or converted into an annuity. (An annuity is an insurance product that provides an income for a person's life-time or for a specific period of time.)

Disadvantages

Required premium levels may make it hard to buy enough protection.
It may be more costly than term insurance if you don't keep it long enough.

Permanent Policy - Points to Consider

Are the premiums within my budget? Be sure you want to spend the money for this type of long-term coverage.
Can I commit to these premiums over the long term?
If you don't plan to keep the product for many years, consider another type of policy.
Cashing in a permanent policy after only a couple of years can be a costly way to get insurance protection for a short term.

What does the policy illustration show?

An illustration shows policy premiums, death benefits, cash values and information about other items that can affect your cost of obtaining insurance. Your policy may provide for dividends to be paid to you as either cash or paid-up insurance. Or it could provide for interest credits that could increase your cash value and death benefit or reduce your premium. These items are not guaranteed*. Your costs or benefits could be higher or lower than those illustrated, because they depend on the future financial results of the insurance company. With variable life, your values will depend on the results of the underlying portfolio of investments.

Some figures are guaranteed* and some are not. Remember that the insurance company will honor the guaranteed* figures, subject to its financial strength.

If your policy is a variable life policy, be sure that the interest rate or rate of return assumed is reasonable for the underlying investment accounts to which you choose to allocate your premiums. It is important to keep in mind that an illustration is not a legal document. Legal obligations are spelled out in the policy itself.

Here are additional questions to ask about the policy illustration:

Is the illustration up to date? Is it based on current experience?
Is the classification shown in the illustration appropriate for me (i.e., smoker/non-smoker, male/female)?
When are premiums due annually, monthly or otherwise? Which figures are guaranteed* and which are not?
Will I be notified if the non-guaranteed* amounts change?
Does the policy have a guaranteed* death benefit, or could the death benefit change depending on interest rates or other factors?
Does the policy pay dividends or provide for interest credits? Are those figures incorporated into the illustration?
Will my premiums always be the same? Is it possible that the premium will increase significantly if future interest rates are lower than the illustration assumes?
If the illustration shows that, after a certain period of time, I will not have to make premium payments, is there a chance I could have to begin making payments again in the future?
Is the premium level illustrated sufficient to guarantee* protection for my entire life?

Purchasing Tips

Here are a few tips to keep in mind when purchasing a life insurance policy:

Take your time. On the other hand, don't put off an important decision that would protect your family. Make sure you fully understand any policy you are considering and that you are comfortable with the company and product.
After you have purchased an insurance policy, keep in mind that you may have a "free-look" period usually 10 days after you receive the policy during which you can change your mind. During that period, read your policy carefully. If you decide not to keep the policy, the company will cancel the policy and give you an appropriate refund. Review the copy of your application contained in your policy. Promptly notify your agent or the company of any errors or missing information.
Review your policy periodically or when your situation changes to be sure your coverage is adequate.

Here are some additional items to consider when you are selecting a term or permanent policy:

What happens if I fail to make the required payments? If you miss a premium payment, you typically have a 30- or 31-day grace period during which you can pay the premium with no interest charged. After that, the company can, with your authorization, draw from a permanent policy's cash surrender value to keep that policy in force as long as there is sufficient cash surrender value. In some flexible premium policies, premiums may be reduced or skipped as long as sufficient cash surrender values remain in the policy. However, this will result in lower cash surrender values.
What if I become disabled? Provisions or riders that provide additional benefits can be added to a policy. One such rider is a "waiver of premium"** for disability. With this rider, if you become totally disabled for a specified period of time, you do not have to pay premiums for the duration of the disability.
Are other riders available?
- "Accidental death benefit", provides for an additional benefit in case of death as a result of an accident. This rider, if available, would require additional premium. Availability and specifics varies by carrier and state.
- "Accelerated benefits", also known as "living benefits." This rider allows you, under certain circumstances, to receive the proceeds of your life insurance policy before you die. Such circumstances include terminal or catastrophic illness, the need for long-term care or confinement to a nursing home. This rider, if available, may require additional premium. Availability and specifics varies by carrier and state.
- "Child rider", provides insurance for all your children, usually ranges from $1,000 to $20,000 of death benefit. This rider, if available, would require additional premium. Availability and specifics varies by carrier and state.
When will the policy be in effect? If you decide to purchase the policy, find out when the insurance becomes effective. This could be different from the date the company issues the policy.

*Guarantees are based on the claims paying ability of the issuing insurance company.

** Availability, specifics, and costs of these riders vary by carrier and state

Note: Any reference to the word guarantee is based on the claims paying ability of the underlying insurance company.

Saving for College with a Section 529 Plan

2011-04-28T04:54:00.000-07:00

What is a 529 Plan?

A 529 plan is a tax advantaged way to save for college and pay for higher education expenses. Unlike some other savings vehicles, a 529 allows you to make sizeable contributions, often over $300,000. The funds may generally be used for any qualified college or higher education expense, including tuition, room, board, fees, books, supplies and equipment. Tax benefits may be subject to certain restrictions.

Money in a 529 plan grows federal and state tax free. In addition, you can withdraw the money without having to pay federal and—depending on the plan and where you live—state income taxes, as long as it’s used to pay for qualified higher education expenses. If the money is used for other purposes, the earnings portion of a withdrawal is subject to ordinary federal income tax, an additional 10% federal tax and any applicable state income taxes.

Who needs a 529 Plan?

Families who are saving for their children’s college education, or adults saving for a college education for themselves, may find that a 529 plan can be a key component of their education funding.

What is covered in a 529 Plan?

Generally, 529 plans come in two forms: college savings plans and prepaid tuition plans. College savings plans allow you to invest your money in an account to pay for the beneficiary’s (student’s) higher education expenses. Students can use the funds for qualified expenses at accredited institutions in the U.S. and abroad. Conditions, such as contribution limits, vary by plan. 529 savings plans are subject to market risk and volatility. Accounts may lose or gain value. Diversification does not assure a profit or protect against loss.

Prepaid tuition plans allow you to "lock in" tuition rates at eligible colleges or universities with a lump-sum investment or monthly installment payments. In other words, since you are paying in advance, you are avoiding potential tuition inflation down the road.

Life Insurance Overview

2011-04-26T03:14:00.000-07:00

What is life insurance?

A life insurance policy is a contract between a policy owner and an insurer. The insurer agrees to pay a sum of money upon the occurrence of the death of the individual insured under the policy. In return, the policy owner agrees to pay a stipulated amount, or premium, at regular intervals.

How is life insurance used?

Life insurance can be used for attracting and retaining key employees, financial management, protecting your business, retirement planning and succession planning.

What are the benefits of life insurance?

There are several benefits to both employees and employers when life insurance is used within business planning strategies. The primary purpose of life insurance is to provide your beneficiary a death benefit in the event you, the insured, dies. This death benefit can be used to help ensure the continuity of your business or be used to transfer business interest. In addition, depending on the life insurance product chosen, a policy can be used to offer supplemental retirement income benefits to you and survivor benefits to your beneficiaries.¹

What are the different types of life insurance products and solutions that can help your business?

Corporate- and Bank-Owned Life Insurance (COLI/BOLI)
COLI/BOLI is life insurance purchased and owned by a company/bank to insure the lives of key employees. COLI/BOLI also can be used as a source of funds to help support deferred compensation and other post-retirement employee benefit programs.

Executive Group Life Insurance (EGL)
Executive Group Life Insurance is employer-sponsored group life insurance designed with the specific needs of executives and professionals in mind.

Term Life Insurance
Term life insurance can be your gateway to permanent insurance, providing the amount of protection you need today at a cost that is less than a comparable permanent policy.

Universal Life Insurance
Universal life insurance provides lifetime death benefit protection along with flexibility that gives you choices as your needs and finances change. It offers options such as coverage amounts that may be increased or decreased, and premiums that you can vary based on your finances.

Variable Universal Life Insurance²
Variable universal life insurance is a flexible premium, permanent insurance product combining death benefit protection with the option to allocate net premiums among divisions of the Separate Account and Guaranteed Principal Account.³

Whole Life Insurance
Whole life insurance provides protection for a lifetime. It offers guarantees that you can’t find in other forms of life insurance, including guaranteed premiums that will not increase, a guaranteed death benefit and guaranteed cash value growth.

Protecting Income with Disability Income Insurance

2011-04-25T04:55:00.000-07:00

The possibility of sustaining a long-term disability from an accident or illness is something most of us would rather not contemplate. However, there is a way to help protect yourself and your family should you lose your ability to earn an income. Disability income insurance can play a key role in your overall financial plan, and provide a benefit to help replace a portion of your income in the event of a total disability.

Evaluating Your Needs
While most people understand the necessity and value of life insurance, many may overlook the valuable role disability income insurance plays in building financial security. How will you support yourself and your family if you cannot work as a result of an accident or illness? For most, Social Security cannot be solely relied on to replace lost wages. One must meet very specific criteria to qualify for disability benefits, and it is often necessary to wait several months for payments to begin.

You may be able to “get by” for a few months on your savings, but if the disability is prolonged, you may exhaust most—or all—of your savings. Further financial hardships may then follow. You may miss mortgage, car, and other credit payments, causing damage to your credit rating. Utility bills, tuition, grocery bills, and business/professional expenses will also continue despite disability and loss of income.

The bottom line is that losing your ability to earn an income may make it difficult to make ends meet. Disability income insurance can be a practical solution to help protect your financial security in the event you become disabled.

Types of Coverage Available
Depending on your income, the maximum coverage will typically replace 45% to 75% of your pre-disability earnings. The cost of the coverage will depend on such factors as the risk level of your occupation, your age, your health history, and the scope of coverage. Professionally employed individuals are typically in a lower risk category than those engaged in more physically demanding work. Individual disability income insurance is by application and is subject to underwriting approval.

It should also be noted that when you pay the premiums (vs. an employer-provided policy), the benefits from individual disability income policies is tax free. If your employer has a salary continuance plan, you should know the dollar amounts of coverage, the waiting period, and the length of payments, so you can coordinate your individual coverage with your employer-provided benefits.

When examining the contract provisions outlined in a potential disability income insurance policy, consider the following:

- Definition of total disability: Does the policy provide coverage in the event that you cannot perform the duties of your own occupation or the duties of any occupation? The former offers better protection, particularly if you are a highly skilled professional.

- Length of benefits payable: Depending on your choice of coverage, the policy may pay benefits until you reach age 65, the age at which many individuals choose to enter retirement.

- A reasonable waiting period: Waiting periods (prior to receiving benefits) are typically between 90 and 180 days, depending on your policy. To determine the length of waiting period you can reasonably manage, consider your liquidity, sick pay, and any money owed to you.

- Is the policy non-cancelable?: As long as your premiums are paid on time, most carriers cannot cancel or change your policy, or increase premiums before you reach age 65.

- Does the policy offer any type of residual disability benefits?: Some policies will provide a benefit if, while still disabled, you return to work but suffer a loss of income as a result of the disability.

- Future insurability: If available, this rider allows for the purchase of future coverage without regard to medical insurability.

It is important to note that the cost of your disability income insurance policy will vary according to the scope of coverage you choose, and there may be an additional premium charged for adding any riders.

Disability income insurance can help protect your most important asset—you and your ability to earn an income. Reviewing your disability coverage may help you determine what type of policy would best help protect you and your family.

The information contained in this article is for general use and while we believe all in formation to be reliable and accurate, it is important to remember individual situations may be entirely different. Therefore, information should be relied upon only when coordinated with professional tax and financial advice

Annuity Basics

2011-04-24T15:48:00.000-07:00

What is an annuity?

An annuity is a contract between an insurance company and an annuity owner. In exchange for a purchase payment, or series of payments, the insurance company guarantees¹ to pay a stream of income in the future.

Who needs an annuity?

Annuities are designed to help individuals convert assets into a stream of income.

What is covered by annuities?

Annuities offer guaranteed income.

What are the different types of annuities?

Immediate Annuities
An immediate annuity begins a stream of income within 12 months from the date of issue. You decide when payments will begin within that period and how long to receive income. There are two types of immediate annuities - fixed or variable.
Deferred Annuities
A deferred annuity is a long-term investment designed to help you accumulate assets for retirement. It also offers the ability to turn those assets into a stream of guaranteed income at some point in the future. You decide when payments begin and how long to receive income. There are basically two types of deferred annuities - fixed or variable.

Annuities are not appropriate for everyone. There are fees and charges associated with owning an annuity.

Prefer to speak to someone about annuities? We'd love to talk with you at Richard Bender Insurance Services.

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SBA Lending On the Rebound

2010-04-27T05:08:00.000-07:00

NEW YORK (CNNMoney.com) -- Small businesses are still struggling to find financing, but for those seeking government-backed loans, the worst may be over. The Small Business Administration's flagship lending program backed 37% more loans in its latest quarter than it did a year ago, at the height of the financial crisis.

In the three months ended Dec. 31, the SBA's 7(a) lending program processed 12,393 loans totaling $3.8 billion, according to preliminary data released Monday by the agency. That's a sharp increase from the 9,070 loans, totaling $1.9 billion, processed in the year-earlier quarter.

Richard Bender Insurance Services - 949.370.8491

Powerful Retirement Security Programs Without Cost

2009-12-13T11:16:00.000-08:00

How to convert under-utilized and under-appreciated voluntary long-term care insurance plans into powerful retirement security programs – without cost to your company!

Why is Group/Plus of critical importance to the success of your retirement plans?

Group/Plus will significantly increase participation in your long-term care

insurance program. This is extremely important because, without long-term care

insurance, it is impossible for your employees to be guaranteed a secure

retirement. Here’s why:

Your company has invested a significant amount of effort and money in your

retirement programs, yet 70% of your retirement plan participants will

spend some, or all of their retirement income on long-term health care costs (1).

For some the costs will be inconsequential. For others, their costs can exceed a

million dollars from care for a severe injury or a stroke, or diseases like

Parkinson’s, Multiple Sclerosis, or Alzheimer’s (2). read more

2009-12-11T13:41:00.000-08:00

BOSTON (TheStreet) -- Federal regulations are shaping how nonprofit organizations manage employee benefit plans for the first time in almost 45 years.

As a result, companies are scrambling to meet the Dec. 31 deadline for compliance. Retirement-management firms have scoped out a new opportunity. MassMutual, for example, recorded a 76% increase in nonprofit-retirement-plan sales in the year through October.

The Internal Revenue Service and Department of Labor are bringing 403(b) retirement plans, which are offered to employees of nonprofit companies, in line with 401(k)'s, which are mostly used by for-profit firms. The government hasn't established a set of guidelines for 403(b)'s since 1964. read more

Supreme Court Decision on Identity Theft

2009-11-02T15:25:00.000-08:00

Supreme Court Makes Decision on Identity Theft

By Laura Tillman, The Brownsville Herald

Immigrants who use false documents cannot be prosecuted for identity theft unless they know those documents belong to a real person, the Supreme Court ruled last week.

Local immigration attorneys called the ruling a "huge victory," saying government attorneys have frequently used the threat of an identity theft charge to intimidate undocumented immigrants into pleading guilty for lesser offenses. Identity theft carries a minimum sentence of two years.

"For the average undocumented immigrant who goes to the flea market and buys a social security card, how are they supposed to know if it belonged to a real person or not?" said Jodie Goodwin, a Harlingen-based lawyer who has been practicing immigration law for 14 years.

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Trouble keeps Coming for one Victim

2009-11-02T15:23:00.000-08:00

Trouble Keeps Coming For Tulsa ID Theft Victim

By Lori Fullbright, The News on 6

TULSA, OK - Identity theft is the fastest growing crime in America and usually involves someone using your identity to steal your money.The News On 6 found one victim who would have been thrilled if the suspect in her case only wanted money.

The real Sherie Harris had her driver's license was stolen in 2000. She says a woman now behind bars is using her name, birth date and social security number from that license. Sherie doesn't know the suspect, but, says whenever Taisha O'Brien gets arrested, it goes on Sherie's record.

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FTC Red Flags Rule Update

2009-11-02T15:16:00.000-08:00

In the ongoing saga of confusion and uncertainty surrounding the Red Flags Rule, the U.S. Federal Trade Commission has announced today that it will once again extend its compliance deadline for the Red Flags Rule - this time until June 2010.

Also, a Washington, D.C. federal district court has ruled that the Federal Trade Commission cannot mandate Red Flags Rule compliance by attorneys. (learn more below).

Reminder: Be certain to visit the Institute's new Online Learning Center and the five new training courses that are now available, and don't miss the special limited time sale on The Informed Consumer's Guide to Identity Theft and Fraud!

Federal Trade Commission Delays Enforcement of "Red Flags Rule" until June 1, 2010

At the request of Members of Congress, the Federal Trade Commission is delaying enforcement of the "Red Flags" Rule until June 1, 2010, for financial institutions and creditors subject to enforcement by the FTC.

Read the FTC Announcement:

http://www.ftc.gov/opa/2009/10/redflags.shtm

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FTC Red Flag Rules

2009-10-29T14:45:00.001-07:00

THU, SEPTEMBER 24, 2009 — CIO — On November 1, many companies will be required to comply with new regulations issued by the Federal Trade Commission that are designed to reduce the risk of fraud through identity theft. The so-called Red Flag rules (formally known as Identity Theft Red Flags and Address Discrepancies) require companies subject to the legislation— essentially any company that issues invoices—to develop a written information security program to detect, prevent and mitigate identity theft in connection with certain types of accounts, including those which present a reasonably foreseeable risk to customers.

The rules are intended to ensure companies can identify and respond to the warning signs of potential identity theft. Companies that don't comply and that suffer a data breach may face financial penalties (up to $3,500 per violation in federal court or $1,000 in state courts) as well as civil lawsuits from identity theft victims. To prepare, your company should dust off its information security policy and have it reviewed by qualified legal counsel to ensure it conforms with the FTC requirements. The following seven guidelines can assist your company with its compliance.

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Why Consider our Business Legal Plan?

2009-10-29T05:31:00.000-07:00

Why should business owners consider our business legal plan? It is really simple people and companies are more litigious in tough economic times. Don't believe me? Below is an excerpt of an article written by Renee McGaw and it was published in Portfolio October 27 2009

Businesses are facing—and filing—more lawsuits these days, a situation that may intensify over the next year.

“People fight harder for their position when the economy’s down,” said Bob Miller, a partner at Perkins Coie LLP in Denver, who specializes in complex commercial litigation.

Nationwide, 42 percent of corporate counsels say they expect their companies to face increased litigation over the next 12 months, compared with 34 percent who expressed that opinion in the previous year, according to a survey released this month by Houston-based law firm Fulbright & Jaworski.

Eighty-three percent of the lawyers surveyed said new litigation had been filed against their companies in the past year, up from 79 percent the previous year. Most of the increase is coming in bankruptcy, contracts, and labor and employment areas, according to the survey; more modest increases were cited in intellectual property, insurance, and regulatory actions.

Would you like to take a look at the benefits of our business plan? Click here

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2009-10-27T09:38:00.000-07:00

You Will Get Health Insurance at DMV

Literally (It's in the Bill)

by Terence P. Jeffrey

10/14/2009

Health Brokers this is a must read: / We do offer an income alternative that can come from your group clients:

Richard Bender - RB Wealth Management Volunteer Benefit Specialists.

The most revelatory passage in the so-called "plain English" version of the health care bill that the Senate Finance Committee approved on Tuesday (without ever drafting the actual legislative language) says that in the future Americans will be offered the convenience of getting their health insurance at the Department of Motor Vehicles.

This is no joke. If this bill becomes law, it will be the duty of the U.S. secretary of health and human services or the state governments overseeing federally mandated health-insurance exchanges to ensure that you can get your health insurance at the DMV.

You will also be able to get it at Social Security offices, hospitals, schools and "other offices" the government will name later.

Page 19 of the committee's "plain English" text says: "The Secretary and/or states would do the following: ... Enable customers to enroll in health care plans in local hospitals, schools, Departments of Motor Vehicles, local Social Security offices, and other offices designated by the state."

This is the bill's most revelatory passage because it sublimely symbolizes the bill's true aim: a government takeover of the health care system.

You do not get food at the DMV. You do not even get auto insurance at the DMV. But under what The Associated Press inaptly calls the Finance Committee's "middle-of-the-road health care plan," you will get health insurance at the DMV.

What will the DMV and health care have in common if this bill is enacted? Government will control both.

A couple of weeks ago, the Finance Committee voted down the public option -- a health insurance plan run directly by the government. The Senate Health, Education, Labor and Pensions Committee and all three House committees working on the bill had included the public option in their versions. So, the establishment media made much of the fact that the Finance Committee did not.

But the omission is almost meaningless.

The public option is only one lane on the road to socialized medicine. Government subsidies and government regulations are two others -- and they run like a super highway through the Finance Committee bill.

The bill orders all states to create an "exchange" where companies offering government-approved plans can sell health insurance. Americans earning up to 400 percent of the poverty level ($103,000 for a family of five) would be eligible for federal subsidies in the form of a refundable tax credit to buy health insurance -- but only if they buy one of the government-approved plans in the government-created exchange.

The government will not pay this subsidy to the individuals purchasing insurance. The U.S. Treasury will pay it directly to the government-approved insurance providers.

"The Treasury would pay the premium credit amount to the insurance plan in which the individual is enrolled," says the committee's "plain English" text.

Four different levels of insurance plans will be available in the exchange -- Bronze, Silver, Gold and Platinum. But every year, the secretary of health and human services will determine what services need to be offered by these government-approved and government-funded plans.

"The Secretary of HHS," says the "plain English" text, "would be required to define and update the categories of covered treatments, items and services within the benefit classes no less than annually through a transparent and public process that allows for public input, including a public comment period."

Under this bill, the government commands individuals to secure insurance for themselves and their dependents. "In order to insure compliance, individuals would be required to report on their Federal tax return the months for which they maintain the required minimum health coverage for themselves and all dependents under age 18," says the text.

The government would enforce this mandate with a fine. "The consequence for not maintaining insurance would be an excise tax of $750 per adult in the household," says the text.

The bill does not similarly order businesses to provide employees with health insurance. However, people who get insurance through their employer will not be eligible for the federal subsidies.

And here is the whip the government will use to drive most Americans into government-approved, government-subsidized, government-controlled health insurance: An employer that decides not to provide health insurance for its workers will be required to pay a fee to the government for each of its workers that receives a federal subsidy. But the total paid to the government by any employer will be capped at $400 times the total number of that employer's workers.

Even though this fee will not be tax deductible, it will be far cheaper for a business to pay the government $400 per worker than to pay a private insurance company thousands per worker for an insurance plan.

The Finance Committee has created an irresistible incentive for American businesses to drop their workers off at the DMV where they can enroll in government-funded, government-approved, government-regulated health insurance plans.

Health Brokers this is a must read: / We do offer an income alternative that can come from your group clients:

Richard Bender - RB Wealth Management Volunteer Benefit Specialists.

Terence Jeffrey is editor at large of HUMAN EVENTS.

If you would like to send a comment to Mr. Jeffrey you can reach him by email atterencejeffrey@eaglepub.com

Generational Gap In Legal Plans

2009-10-26T07:11:00.000-07:00

Generational differences can be found in the way people approach legal matters, confirms a new national study by Russell Research conducted on behalf of ARAG, a leading provider of legal insurance in the worksite market.

“Legal Needs of Today’s Multi-Generational Workforce” showed that Baby Boomers, for example, are most concerned with the creation of a will, estate plan or trust, while members of Generation Y tend to focus on identity theft and credit card theft, as well as apartment rental and landlord disputes.

There’s also plenty of worry to go around given the challenging economy in that “people are increasingly concerned about a wide range of legal needs for which professional expertise would be useful for prevention or resolution,” reports Ann Dieleman, ARAG’s senior vice president and chief marketing officer.

Of the respondents, 67% experienced a family, financial, home or automobile-related legal event in the past year. Other key findings indicate that only one-fifth of the survey respondents have the means for saving for legal events, nearly two-fifths do not have any plan and another two-fifths would have to find a way to cover any expenses that arise.

Source link below:

http://www.voluntary.com/articles.cfm?articleID=311

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Pre-Paid Legal in Forbes Magazine

2009-10-20T14:15:00.000-07:00

Pre-Paid Legal In Forbes Magazine

Pre-Paid Legal Services, Inc. On the Rise in the 2009 Forbes List of 'America's 200 Best Small Companies'

ADA, Okla., Oct. 20 /PRNewswire-FirstCall/ -- Pre-Paid Legal Services, Inc. (NYSE: PPD) is ranked number 66 in the 2009 Forbes Magazine annual list of "America's 200 Best Small Companies," climbing 64 positions from its 2008 ranking of 130 on this list. For the second consecutive year Pre-Paid Legal Services has retained the number one ranking in the Forbes survey in the category of return on equity (RoE), a measure of how efficiently a company uses its assets to produce earnings.

"It's gratifying to see Pre-Paid Legal Services recognized once again in the Forbes list of best small companies in America," said Harland C. Stonecipher, Founder and CEO of Pre-Paid Legal Services. "We are proud to be listed among America's finest small companies and we are especially pleased that our bottom line results have merited such high ranking."

Stonecipher describes the PPD's repeat performance as the number one ranked company for return on equity as significant. Earlier this year, DeMarche Associates, an independent investment research firm, named PPD as one of the 100 best U.S. corporations, based on the company's growth and risk management strategy.

PPD's 2009 Forbes ranking (based on $453 million in sales), included the 192nd position for sales growth and the 128th position for earnings per share.

PPD has been on the Forbes list for the past three years, which in itself is a measure of stability. According to Forbes, 71 of the 200 companies listed last year fell off the 2009 list. The Forbes list rankings are based on earnings growth, sales growth and return on equity for the previous 12 months.

About PPD

We believe our products are one of a kind, life events legal service plans. Our plans provide for legal service benefits provided through a network of independent law firms across the U.S. and Canada, and include unlimited attorney consultation, will preparation, traffic violation defense, automobile-related criminal charges defense, letter writing, document preparation and review and a general trial defense benefit. We have an identity theft restoration product we think is also one of a kind due to the combination of our identity theft restoration partner and our provider law firms. More information about our products and us can be found at our homepage click here

Pre-Paid Legal Makes Your Benefit Plan Complete

2009-10-05T10:03:00.000-07:00

RB Wealth Management - Volunteer Benefit Specialists

Pre-Paid Legal Services

Prepaid Legal Services: Wills, Legal Contracts, Traffic Court, Divorce, Credit Disputes, Child Support, Landlord / Tenant / Property Dispute

A well-structured benefit program helps retain high quality employees, and attracts the best candidates for employment. RB Wealth Management benefits specialists can help design comprehensive benefits packages for companies of all types and sizes, whether for two, 200 or 2,000 employees.

A well-balanced plan includes company-sponsored benefits like group health insurance, as well as a selection of popular voluntary benefits with little or no additional cost to the employer, such as disability insurance and prepaid legal services.

Prepaid Legal: Like Having an Attorney on Retainer

Chances are good that, for one reason or another, just about everyone will need the services of a lawyer within the next year. Unfortunately, most people hesitate to call one for fear of the cost, or the mistaken belief that they could handle the problem on their own.

There are many reasons people might want to consult with an attorney, most of them totally unrelated to criminal activities, including:

Wills - drafting and /or updating
Review legal contracts
Representation in traffic court
Divorce
Credit Disputes
Return of Security Deposits
Child Support Issues
Landlord / Tenant or Property Dispute

Prepaid Legal Services: Employees Judge the Value for Themselves

As a voluntary benefit, employees choose whether to participate, at their own cost, and at what level, and pay for the benefit through payroll deductions. The only cost to the employer is for the minor administrative functions involved.

The basic services provided under most prepaid legal plans include:

General legal advice and consultation
Legal document consultation
Preparation of simple wills
Letters written or phone calls made by a lawyer to an opposing party

Some plans offer options for more comprehensive coverage for:

Civil and/or Criminal Trials
Marital problems
Bankruptcy
Real estate issues
Other option may be available

Pre-Paid Legal, A Productive Perk

2009-10-02T14:01:00.000-07:00

A PRODUCTIVE PERK

WHY OFFERING A PREPAID LEGAL PLAN WITH YOUR COMPANY’S BENEFITS PACKAGE PAYS OFF FOR EMPLOYEES--AND FOR YOU

by Jennifer Larson

A prepaid legal plan is just what it sounds like: an arrangement that gives an employee access to the services of an attorney for a wide range of legal needs. Depending on the type of plan, the possibilities range from assistance in creating a will to contract negotiation to representation in divorce proceedings or for a major trial.

The number of employers offering prepaid legal plans to their employers is growing, but right now, it’s still pretty small. According to the International Foundation of Employee Benefit Plans’ Employee Benefits Survey: U.S. and Canada 2009, about a quarter of respondents say they offer a legal services plan to their participants. The Society for Human Resource Management conducted a similar employee benefits survey and found that about 21 percent offer legal services.

The benefit to the employees is fairly straightforward. "It gives people access to the legal system," says Nick Serba. "Most people are priced out of the legal system. They can’t afford it, or they don’t know someone who can help them."

Terry Perry, owner of Pink slip, a three-person company in San Jose, Calif., was grateful for her company’s prepaid legal plan two years ago when she received a speeding ticket while out of town. She called and received an attorney’s assistance to get it settled quickly.

"The benefit is fantastic for those sorts of things," says Perry, who has offered the plan as a benefit to her employees for three years.

So what’s the payoff for employers? Studies have shown that employees who are satisfied with their benefits tend to be more satisfied with their jobs in general. Proponents of prepaid legal plan benefits say access to legal services tends to reduce employee absenteeism because employees can get the services they need. They don’t need to miss work to sort out their legal affairs.

"It keeps the employees in a more productive mode," Serba says.

It can be useful, Perry agrees, but she notes that some people may be reluctant to spend any additional money right now.

"I know people are cautious about how they’re spending their money," says Perry, who asks her employees to pay for this particular benefit if they want to use it.

The cost of offering the rich benefit is extremely inexpensive and many people find the coverage and services a very important part of their total life strategy.

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Legal Services Popularity Increase in The Workplace

2009-09-26T18:17:00.000-07:00

Legal Services Popularity Increases

Legal services are one of the more popular voluntary benefits. Over the past several years, their popularity in the worksite has increased dramatically. Most employees will need legal help at some point in their lives. Research has found that legal issues cause a tremendous amount of absenteeism, employee stress, work distraction and lost productivity. As a result, the interest in legal services as a voluntary benefit has grown tremendously.

Legal service plans cover a wide range of legal needs including will and estate planning, home purchase, lease review, adoption and divorce, personal disputes, and driving-related incidents.

Visit our web site for more details

Why Do My Employees Need Legal Protection?

2009-09-26T11:03:00.000-07:00



	Do you have access to justice? Pre-Paid Legal can help protect your legal rights. Be able to say, "I'm going to talk to my lawyer about that." — AND MEAN IT! Tell me more!

Perhaps it will surprise you when you learn what is covered by the Pre-Paid Legal membership.

Have you ever been afraid to call a lawyer because of the cost?
Have you ever thought about writing or revising your will?
Have you ever signed a contract or other document?
Have you ever just wanted to know what your rights are in a given situation?
See our Plan Information to learn about the benefits of becoming a Pre-Paid Legal member.

Pre-Paid Legal Plans vary by state and province.
Most family plans are $26 a month or less.

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3 Legal papers you shouldn't live without

2009-07-30T06:05:00.000-07:00

Writing about incapacity is one thing. Experiencing it, even secondhand, is quite another.

My father suffered a devastating stroke last year while visiting his sister in Florida. During the final four months of his life, this once bright, capable man couldn't decide anything more complicated than what color shirt to wear on a given day. Every other decision regarding his life -- what he ate, how his bills were paid and how hard his caregivers should fight to keep him alive -- had to be made by others.

Most Americans don't have wills, but that's not the crisis that many in the estate-planning industry would have you believe. With a few exceptions, which we'll talk about below, most people's quality of life won't be much improved by a will. READ MORE

5 Ways to Keep Retiring in 5 Years

2009-07-24T06:17:00.000-07:00

To say Americans are feeling lousy about their retirement prospects is a huge understatement. They're feeling downright hopeless. Only 13 percent of adults over 25 are certain they'll be able to live comfortably in their later years, according to a recent survey by the Employee Benefit Research Institute. That's the lowest level of confidence reported since the annual survey began in 1993. And who can blame these dejected retirement savers? The majority of would-be retirees have watched their nest eggs crumble in the market's undoing, and few have the cushion of a traditional pension. Even if stocks return to their prerecession highs in the near future--and that's a big if--traditional retirement will still be tough. That's because would-be retirees are also facing the threats of rising inflation, ballooning healthcare costs, the possibility of outliving their money, and the prospect of another big market drop. Here are some ways to prepare for these challenges: Read More....

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