Insurance

Should You Exchange Your Life Insurance Policy?

2013-05-24T12:18:00.000-07:00

If you own a life insurance policy, you may have been approached to exchange it for another new policy. You need to know that even though the tax laws make the exchange income tax free and the new policy may appear better to you, you may be losing?not gaining?if you make the exchange. We are issuing this Alert because, increasingly, life insurance exchanges may involve variable products. Variable products are securities, and this Alert will provide information to help you evaluate whether the exchange is right for you, and how you can find out what you need to know to make an appropriate decision.There are various forms of life insurance products. Although features and benefits may vary, the following is a general description of typical characteristics of various types of life insurance policies.• Term Life Insurance. Term life insurance provides coverage for a specified and limited period of time (the "term"). Premiums for most term policies increase with age or at the end of each renewal period. After the policy or term ends, there is no benefit payment if the insured person survives beyond the policy period.• Whole Life Insurance. Whole life or ordinary life insurance is a form of permanent life insurance. This means it can provide coverage for the life of the insured. It also can build cash value, which is a savings feature. Premium payments typically remain level for the life of the insured.• Universal Life Insurance. Universal life insurance can also provide coverage for the life of the insured while at the same time providing flexibility in premium payments and in insurance coverage. The cost of insurance protection and, in some cases, other costs are deducted from the cash or policy account value.• Variable Life Insurance. Variable life insurance, a variation of whole life insurance, offers a fixed premium schedule and a minimum death benefit. But it differs from traditional whole life insurance in that cash values are invested in portfolios of securities in an account separate from the general assets of the insurance company. A policyholder has discretion in choosing the mix of investments the policy offers. The insurance company does not guarantee investment returns and your cash value will fluctuate.• Variable Universal Life Insurance. Variable universal life insurance combines features of universal life insurance and variable life insurance.Most variable life insurance policies and variable universal life insurance policies are securities registered with the Securities and Exchange Commission (SEC). Registration requires that investors receive important financial and other significant information concerning the securities being offered for sale. This enables investors to judge for themselves if the securities are a good investment. These regulations also provide important remedies to investors if they can prove that there was incomplete or inaccurate disclosure of important information provided to them.The Internal Revenue Service allows you to exchange an insurance policy that you own for a new life insurance policy insuring the same person without paying tax on the investment gains earned on the original contract. This can be a substantial benefit. Because this is governed by Section 1035 of the Internal Revenue Code, these are called "1035 Exchanges."But this benefit comes with some important strings.• The tax code says that the old insurance policy must be exchanged for a new policy - you cannot receive a check and apply the proceeds to the purchase of a new insurance policy.• The tax code also says that you can make a tax-free exchange from: 1) a life insurance policy to another life insurance policy or 2) a life insurance policy to an annuity. You cannot, however, exchange an annuity contract for a life insurance policy.A transaction in which a new insurance or annuity contract is to be purchased using all or a portion of the proceeds of an existing life insurance or annuity contract is referred to as a "replacement." A 1035 Exchange is a type of replacement transaction. Although the term "1035 Exchange" is often used to describe any form of replacement activity, technically not all replacements are Section 1035 Exchanges and as a consequence are not tax-free.Reasons to Exchange an Existing Policy?There are various reasons why a life insurance policyholder may want to replace an existing policy with a new life insurance policy. For example,• Improved health or mortality improvements across the general population may result in insurance coverage at a lower cost.• You may have concerns with the solvency of the insurance company that issued the original policy or with the service of the agent that sold you the policy.• A new life insurance policy may have more desirable features or benefits.Reasons Not to Exchange an Existing PolicyThere are also various reasons why replacement of an existing insurance policy may not be a good idea. For example,• Cash value built up in the original policy may be applied to the new life insurance policy's first year expenses, including commissions.• Life insurance policies (other than term policies) often include early surrender charges, which can reduce the amount of cash value available toward the new policy. The new policy will likely have its own new surrender charge schedule, which may extend beyond that of the original policy.• You may pay higher premiums if, for example, your health has declined since the purchase of the current policy.• The new policy typically will have a new contestability period - a two-year period from the issuance of the new policy during which the insurance company could challenge a death claim based upon a misstatement on the application.• There may be unfavorable tax consequences caused by surrendering an existing policy, such as a potential tax on outstanding policy loans.You should exchange your life insurance policy only when you determine, after knowing all of the facts that the exchange is better for you and not just better for the person who is trying to sell the policy to you.Both variable life insurance and variable universal life insurance are securities. Those who offer these products must follow SEC, FINRA, and state securities regulations, in addition to state insurance law. This means that a broker must tell you the important facts about the pros and cons of the exchange. Your broker or insurance agent should recommend such an exchange only if it is in your best interest and only after evaluating your personal and financial situation and needs, tolerance for risk, and the financial ability to pay for the proposed insurance policy.Your broker or insurance agent may recommend that you use insurance policy values, such as loans or withdrawals, to pay premiums for a new life insurance policy. This activity is generally called "financing" premiums. It may not be appropriate for you. For example, withdrawals from existing policies may be subject to federal income tax and may reduce the death benefit. Borrowing money from an existing policy will almost certainly reduce the death benefit. Withdrawals or loans may make it more difficult to keep the original policy in force without additional out-of-pocket premium payments. If you can't keep the original policy in force, you will lose the insurance protection and the loans themselves may give rise to tax consequences. Remember for a transaction to qualify as a 1035 exchange, the old policy must actually be exchanged for the new policy. Many states and brokerage firms require forms to reflect customer acknowledgement of a replacement transaction. These forms typically are signed by the insurance policy owner and the broker or agent. These forms may provide a comparison of the features and costs of an existing policy to a proposed policy, and point out what you need to focus on when considering an exchange. Some brokerage firms may provide brochures or educational material designed to outline the possible advantages and disadvantages of the transaction. You should review these forms and materials closely.Regardless of whether such forms are provided, you should specifically ask the person recommending that you exchange or replace your existing policy to provide you with illustrations for your existing policy and the new policy. You should also ask:• What is the total cost to me of this exchange?• What are the new features being offered? Why do I need those features?• Are these features worth the cost?• Can the existing policy be modified or supplemented to provide some or all of these same features?• Will you be paid a commission for the exchange, and if so, how much is it?You should not sign any exchange form or agree to exchange or purchase an insurance policy until you study all of the options carefully, have all of your questions answered, and are satisfied that the exchange is better than keeping your current policy.If You Have Questions or Complaints

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How to reduce your auto insurance premiums

2013-05-24T08:08:00.000-07:00

Here’s something to stop and consider: When’s the last time you devoted mental energy to the particulars of your auto insurance policy? Did you basically set it and forget it?It’s incredibly easy to let that happen — and if it has happened in your case, it might be high time to refresh your memory on just where your policy stands. You may be able to take a bite out of your insurance bill with a minimal amount of effort.These quick tips can help you see whether you can save a little – or a lot.1. Request higher deductibles. The deductible is the amount of money you have to fork over before your insurance policy comes to the rescue. By bumping your deductible up from $200 to $500, you could lower the cost of your collision and comprehensive coverage by 15 percent to 30 percent. By increasing it to $1,000, you could decrease that cost by at least 40 percent.
Prince Harry supports Sandy efforts, wounded vets in current U.S. tour Prince Harry begins his week-long American tour with a trip to Washington, D.C. to support a charity his mother held close...Doctors solve mystery of boy's baffling strokes'Arrested Development' fans can hit Bluth's banana standHoda makes Maxim's Hot 100 list with Miley CyrusFounder of Italy's fashion house Missoni dies at 922. Forgo coverage you don’t need. Think about dropping collision and/or comprehensive coverage on older cars with a low market value. Such coverage often is not worth it because any claim you make probably won’t exceed the cost of the insurance and the deductible amount. To assess your car’s current value, visit Kelley Blue Book or Edmunds.com.3. Avoid duplicating medical coverage. If you already have good health, life and disability insurance, buy only the minimum personal injury protection required by the state where you live.4. Purchase a low-profile car. It’s more expensive to insure a vehicle that’s expensive to repair, popular with thieves or known for not having the greatest safety record. For a rundown of vehicles’ risk levels, visit the Insurance Institute for Highway Safety’s Web site. (To check on older models, go to the bottom of the page.)5. Carpool or drive less. Many insurance companies offer “low-mileage discounts” to policyholders who carpool to work or drive a lower-than-average number of miles each year. You can call your insurer and find out whether you qualify.6. Opt for safety gear. You can qualify for a discount on many policies if you have air bags, automatic seat belts, anti-lock brakes and daytime running lights. An approved alarm system or other anti-theft device can give you additional savings.7. Seek out discounts for teens. Insure teenagers on the parents’ policy rather than a separate policy. Teens who maintain good grades and pass an approved drivers’ education course usually can qualify for reduced rates. An additional discount may come into play if your child goes to college more than 100 miles from home and doesn’t bring a car along.8. Combine policies with one carrier. You may save money if you insure all your vehicles, including trailers and recreational vehicles, on a single policy. Your car premium also may go down if you buy homeowners’ or life insurance from the same company.9. Ask about other discounts. You also might be able to pay less if you’re older than 50 or 55 and/or retired; if you’ve had no accidents or moving violations in three years; or if you’re a longtime customer. Keep an eye on the bottom line, though. Call a few other insurers to make sure you’re paying the lowest overall amount.10. Pause before paying extra for roadside assistance. It might be good to line up a roadside assistance plan elsewhere because a tow could increase your auto insurance premium and might even affect your eligibility for coverage. What’s more, you may already have an adequate roadside plan through your credit card.

View the original article here

Life Insurance is a Good Safety Net, but not for E...

2013-05-24T04:04:00.000-07:00

The first question is when do you need life insurance? You need life insurance under the following conditions (if you don't fall into one of the categories below, you probably don't need life insurance at this time, but remember to review your situation again from time to time when circumstances may change).• You have dependent children. The loss of your income will most definitely affect your spouse's ability to remain in the family home with the children or provide the level of education that you would have provided for your children if you were still alive and working.• You are married to a nonworking spouse. In this situation, your death will affect your spouse's ability to continue in the same life style, as going to work for the first time or going back to work after being out of the workplace will result in a lower paying job with a much diminished standard of living.• You have a working spouse with an income substantially less that your income. Life insurance is appropriate here as your higher income has given you a lifestyle that your spouse could not afford alone.• You have parents or special need siblings to care for and support.• You still have a large mortgage remaining on your home. Having life insurance in this circumstance will allow your spouse to use the life insurance proceeds to pay off the mortgage, easing your spouse's financial burden after your death.• You are using life insurance as an estate planning tool and wish to provide your family with the proceeds of life insurance that will restore to them the amount of your estate that was diminished by death taxes.Another question to ask is how much insurance is enough? The proper amount of life insurance would allow your beneficiaries and their dependents to invest the proceeds of life insurance and draw down the earnings thereon and some capital over time to live on to make up for the loss of earnings that the deceased spouse would have provided. There are several basic methods to determine the amount of the insurance that you may need:• The standard rule of thumb to estimate the amount of your life insurance needs is to estimate that you will need life insurance between five and ten times your annual salary net of taxes. If your net salary is $50,000 per year, you would have a minimum life insurance need of $250,000 and a maximum amount of $500,000. This method is fairly simplistic and does not take into account the specific needs you may have, such as the price of your children's education or the amount necessary for a special needs child.• The second method seeks to replace the amount of your income over a number of years. For instance, if you earned $50,000 per year and you wanted to make sure that income was available to your spouse for the next fifteen years, you would need $750,000 of life insurance. This method is fine, as long as there are no special needs to address and you have little in the way of financial assets already.• The third and most detailed method is to review the financial need. In this approach, you would take into account the various expenses that your income would otherwise pay, such as the family's annual living expenses, tuition for college and graduate education, mortgage or debt payoff and future retirement needs, as well as any special needs. This approach will require a little more thought and effort on your part to determine what expenses will be covered and what expenses are already covered by financial assets, such as college expenses that you have already taken care of through Section 529 plans and the like.Life insurance is not for everyone, but there are many times that it is a necessary part of your financial planning for your family's future.

View the original article here

Life Insurance is a Good Safety Net, but not for E...

2013-05-20T08:58:00.000-07:00

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How to reduce your auto insurance premiums

2013-05-20T04:40:00.000-07:00

View the original article here

Should You Exchange Your Life Insurance Policy?

2013-05-20T01:34:00.000-07:00

View the original article here

Should You Exchange Your Life Insurance Policy?

2013-05-16T11:30:00.000-07:00

View the original article here

Life Insurance is a Good Safety Net, but not for Everyone

2013-05-16T07:26:00.001-07:00

View the original article here

How to reduce your auto insurance premiums

2013-05-09T10:49:00.000-07:00

Here’s something to stop and consider: When’s the last time you devoted mental energy to the particulars of your auto insurance policy? Did you basically set it and forget it?

It’s incredibly easy to let that happen — and if it has happened in your case, it might be high time to refresh your memory on just where your policy stands. You may be able to take a bite out of your insurance bill with a minimal amount of effort.

These quick tips can help you see whether you can save a little – or a lot.

1. Request higher deductibles. The deductible is the amount of money you have to fork over before your insurance policy comes to the rescue. By bumping your deductible up from $200 to $500, you could lower the cost of your collision and comprehensive coverage by 15 percent to 30 percent. By increasing it to $1,000, you could decrease that cost by at least 40 percent.

1. Prince Harry supports Sandy efforts, wounded vets in current U.S. tour
  
  Prince Harry begins his week-long American tour with a trip to Washington, D.C. to support a charity his mother held close...
2. Doctors solve mystery of boy's baffling strokes
3. 'Arrested Development' fans can hit Bluth's banana stand
4. Hoda makes Maxim's Hot 100 list with Miley Cyrus
5. Founder of Italy's fashion house Missoni dies at 92

2. Forgo coverage you don’t need. Think about dropping collision and/or comprehensive coverage on older cars with a low market value. Such coverage often is not worth it because any claim you make probably won’t exceed the cost of the insurance and the deductible amount. To assess your car’s current value, visit Kelley Blue Book or Edmunds.com.

3. Avoid duplicating medical coverage. If you already have good health, life and disability insurance, buy only the minimum personal injury protection required by the state where you live.

4. Purchase a low-profile car. It’s more expensive to insure a vehicle that’s expensive to repair, popular with thieves or known for not having the greatest safety record. For a rundown of vehicles’ risk levels, visit the Insurance Institute for Highway Safety’s Web site. (To check on older models, go to the bottom of the page.)

5. Carpool or drive less. Many insurance companies offer “low-mileage discounts” to policyholders who carpool to work or drive a lower-than-average number of miles each year. You can call your insurer and find out whether you qualify.

6. Opt for safety gear. You can qualify for a discount on many policies if you have air bags, automatic seat belts, anti-lock brakes and daytime running lights. An approved alarm system or other anti-theft device can give you additional savings.

7. Seek out discounts for teens. Insure teenagers on the parents’ policy rather than a separate policy. Teens who maintain good grades and pass an approved drivers’ education course usually can qualify for reduced rates. An additional discount may come into play if your child goes to college more than 100 miles from home and doesn’t bring a car along.

8. Combine policies with one carrier. You may save money if you insure all your vehicles, including trailers and recreational vehicles, on a single policy. Your car premium also may go down if you buy homeowners’ or life insurance from the same company.

9. Ask about other discounts. You also might be able to pay less if you’re older than 50 or 55 and/or retired; if you’ve had no accidents or moving violations in three years; or if you’re a longtime customer. Keep an eye on the bottom line, though. Call a few other insurers to make sure you’re paying the lowest overall amount.

10. Pause before paying extra for roadside assistance. It might be good to line up a roadside assistance plan elsewhere because a tow could increase your auto insurance premium and might even affect your eligibility for coverage. What’s more, you may already have an adequate roadside plan through your credit card.

2013-04-27T06:55:00.001-07:00

THE PRICE YOU pay for life insurance will
depend on your age, your health and your habits. That is to say, forget about a really cheap policy if you smoke, have existing health problems or enjoy skydiving. Still, there's plenty you can do to save on your premium and avoid some common pitfalls.

Here are 10 suggestions:

If you get some life insurance as a job benefit, that's fine. But that should never be all you have. You can't count on keeping it if you lose your job or become disabled and can no longer work. There's no federal law that says your old employer must allow you to keep the coverage, even if you foot the bill. So it's a good idea to use any life insurance you get from work as a supplement to what you buy on your own. If your company allows you to buy additional insurance, be sure to compare rates on coverage you can buy from your employer; more often than not, you can find a better deal on your own, although you'll have to qualify medically to get a policy on the open market.

Kevin Campbell thought he was just being honest a couple of years ago when he told a medical examiner for John Alden that he smokes a cigar about once a year. The Ohio physician, who plays racquetball once a week and jogs regularly, had no history of medical problems.

He figured the insurer would understand that cigars were simply a way to mark special occasions. No such luck. As far as John Alden was concerned, there was no difference between Campbell and a two-pack-a-day man. The company quoted him a $2,150 annual premium for a $1.3 million, 10-year term policy, $1,150 more than the nonsmoker's rate.

But Campbell wasn't having it. He wrote a letter to John Alden demanding a nonsmoker's rate. After three weeks of negotiating, the company caved in and cut his initial quote by 50%. Says adviser Michael Chasnoff, who helped Campbell set up the policy: "When I started in this business, I would have never thought to question what an insurance company told a client. Now I can't see a reason not to." (If you do smoke, 'fess up. If you die of a smoking-related illness, your insurer can choose not to pay your death benefit, opting instead to return to your beneficiaries only paid-up premiums plus interest.)

If you're going to buy $240,000 of coverage, you might as well buy $250,000. If you buy $240,000 worth, you'll pay $274.80 per year. If you buy $250,000, it will cost $260. How's that?

Sometimes more insurance costs less, especially as you approach multiples of $250,000. So, for example, a 35-year-old male nonsmoker buying $100,000 to $249,999 of renewable term insurance from USAA Life would pay $1.02 per $1,000 of coverage. For $250,000 to $499,999 of coverage, the rate drops to 92 cents per $1,000.

Forrest Luu, 37, has diabetes. When he set out to buy life insurance, he asked his insurance agent, Murray Halbfish, to shop for a diabetics-friendly company. The best deal Halbfish came up with: Manhattan Life Insurance, which quoted him an annual premium of $891 for $100,000 of whole life. Other companies wanted as much as $1,500. As Luu found out, some companies specialize in particular diseases or lifestyles. For heart disease, cancer or other "impaired risks," companies such as Connecticut National and U.S. Financial offer competitive rates. These companies employ underwriters who are trained to analyze the extent of a given problem. Instead of lumping all diabetics into one group, they rate differences between diabetics who take their medication regularly and diabetics whose disease is out of control. A person whose disease is under control could save as much as 50% on a premium.

That agent who talked you into turning in your old whole life policy for a new one (More coverage! No extra premiums!) didn't do you a favor. In fact, you've been scammed. More often than not, victims of this practice, known as "churning," receive a bill for new premiums within a year or two after the value in their old policy has been exhausted. But you can get help if you've been ripped off by your agent. Contact your state insurance commissioner to find out how to proceed. Dozens of companies have agreed to compensate victims of these and other illegal practices. Don't forget to complain to the main office of your insurance company directly. Many insurers are now fairly quick to make whole life customers who have been hoodwinked by their agents.

How much will life insurance cost me?

2013-04-27T06:40:00.000-07:00

That depends on your age, your health and the size of the death benefit you want. No surprise that the younger and healthier you are, the lower your premium will be.

Just as a ballpark, a healthy 40-year-old man who buys a 20-year level term policy, which has a fixed annual premium, might pay $350 a year to secure a $500,000 death benefit. A healthy 50-year-old man who buys the same policy might pay $1,000 a year. If he waits until he's 60, the policy will cost about $3,000 a year.

Premiums for cash-value policies are much higher. For example, the healthy 40-year-old man who pays $350 a year for a $500,000 term policy would pay about $3,000 a year for a $500,000 universal life policy - in part because a portion of that $3,000 is going into the investment component of the policy. That's a huge difference.

Life Insurance is a Good Safety Net, but not for Everyone

2011-10-28T00:31:00.001-07:00

• You have dependent children. The loss of your income will most definitely affect your spouse's ability to remain in the family home with the children or provide the level of education that you would have provided for your children if you were still alive and working.

• You are married to a nonworking spouse. In this situation, your death will affect your spouse's ability to continue in the same life style, as going to work for the first time or going back to work after being out of the workplace will result in a lower paying job with a much diminished standard of living.

• You have a working spouse with an income substantially less that your income. Life insurance is appropriate here as your higher income has given you a lifestyle that your spouse could not afford alone.

• You have parents or special need siblings to care for and support.

• You still have a large mortgage remaining on your home. Having life insurance in this circumstance will allow your spouse to use the life insurance proceeds to pay off the mortgage, easing your spouse's financial burden after your death.

• You are using life insurance as an estate planning tool and wish to provide your family with the proceeds of life insurance that will restore to them the amount of your estate that was diminished by death taxes.

Another question to ask is how much insurance is enough? The proper amount of life insurance would allow your beneficiaries and their dependents to invest the proceeds of life insurance and draw down the earnings thereon and some capital over time to live on to make up for the loss of earnings that the deceased spouse would have provided. There are several basic methods to determine the amount of the insurance that you may need:

• The standard rule of thumb to estimate the amount of your life insurance needs is to estimate that you will need life insurance between five and ten times your annual salary net of taxes. If your net salary is $50,000 per year, you would have a minimum life insurance need of $250,000 and a maximum amount of $500,000. This method is fairly simplistic and does not take into account the specific needs you may have, such as the price of your children's education or the amount necessary for a special needs child.

• The second method seeks to replace the amount of your income over a number of years. For instance, if you earned $50,000 per year and you wanted to make sure that income was available to your spouse for the next fifteen years, you would need $750,000 of life insurance. This method is fine, as long as there are no special needs to address and you have little in the way of financial assets already.

• The third and most detailed method is to review the financial need. In this approach, you would take into account the various expenses that your income would otherwise pay, such as the family's annual living expenses, tuition for college and graduate education, mortgage or debt payoff and future retirement needs, as well as any special needs. This approach will require a little more thought and effort on your part to determine what expenses will be covered and what expenses are already covered by financial assets, such as college expenses that you have already taken care of through Section 529 plans and the like.

Life insurance is not for everyone, but there are many times that it is a necessary part of your financial planning for your family's future.

Should You Exchange Your Life Insurance Policy?

2011-10-16T21:07:00.001-07:00

Staff from FINRA

Types of Life Insurance

There are various forms of life insurance products. Although features and benefits may vary, the following is a general description of typical characteristics of various types of life insurance policies.

• Term Life Insurance. Term life insurance provides coverage for a specified and limited period of time (the "term"). Premiums for most term policies increase with age or at the end of each renewal period. After the policy or term ends, there is no benefit payment if the insured person survives beyond the policy period.

• Whole Life Insurance. Whole life or ordinary life insurance is a form of permanent life insurance. This means it can provide coverage for the life of the insured. It also can build cash value, which is a savings feature. Premium payments typically remain level for the life of the insured.

• Universal Life Insurance. Universal life insurance can also provide coverage for the life of the insured while at the same time providing flexibility in premium payments and in insurance coverage. The cost of insurance protection and, in some cases, other costs are deducted from the cash or policy account value.

• Variable Life Insurance. Variable life insurance, a variation of whole life insurance, offers a fixed premium schedule and a minimum death benefit. But it differs from traditional whole life insurance in that cash values are invested in portfolios of securities in an account separate from the general assets of the insurance company. A policyholder has discretion in choosing the mix of investments the policy offers. The insurance company does not guarantee investment returns and your cash value will fluctuate.

• Variable Universal Life Insurance. Variable universal life insurance combines features of universal life insurance and variable life insurance.

Most variable life insurance policies and variable universal life insurance policies are securities registered with the Securities and Exchange Commission (SEC). Registration requires that investors receive important financial and other significant information concerning the securities being offered for sale. This enables investors to judge for themselves if the securities are a good investment. These regulations also provide important remedies to investors if they can prove that there was incomplete or inaccurate disclosure of important information provided to them.

1035 Exchanges

The Internal Revenue Service allows you to exchange an insurance policy that you own for a new life insurance policy insuring the same person without paying tax on the investment gains earned on the original contract. This can be a substantial benefit. Because this is governed by Section 1035 of the Internal Revenue Code, these are called "1035 Exchanges."

But this benefit comes with some important strings.

• The tax code says that the old insurance policy must be exchanged for a new policy - you cannot receive a check and apply the proceeds to the purchase of a new insurance policy.

• The tax code also says that you can make a tax-free exchange from: 1) a life insurance policy to another life insurance policy or 2) a life insurance policy to an annuity. You cannot, however, exchange an annuity contract for a life insurance policy.

A transaction in which a new insurance or annuity contract is to be purchased using all or a portion of the proceeds of an existing life insurance or annuity contract is referred to as a "replacement." A 1035 Exchange is a type of replacement transaction. Although the term "1035 Exchange" is often used to describe any form of replacement activity, technically not all replacements are Section 1035 Exchanges and as a consequence are not tax-free.

Reasons to Exchange an Existing Policy?

There are various reasons why a life insurance policyholder may want to replace an existing policy with a new life insurance policy. For example,

• Improved health or mortality improvements across the general population may result in insurance coverage at a lower cost.

• You may have concerns with the solvency of the insurance company that issued the original policy or with the service of the agent that sold you the policy.

• A new life insurance policy may have more desirable features or benefits.

Reasons Not to Exchange an Existing Policy

There are also various reasons why replacement of an existing insurance policy may not be a good idea. For example,

• Cash value built up in the original policy may be applied to the new life insurance policy's first year expenses, including commissions.

• Life insurance policies (other than term policies) often include early surrender charges, which can reduce the amount of cash value available toward the new policy. The new policy will likely have its own new surrender charge schedule, which may extend beyond that of the original policy.

• You may pay higher premiums if, for example, your health has declined since the purchase of the current policy.

• The new policy typically will have a new contestability period - a two-year period from the issuance of the new policy during which the insurance company could challenge a death claim based upon a misstatement on the application.

• There may be unfavorable tax consequences caused by surrendering an existing policy, such as a potential tax on outstanding policy loans.

What You Should Watch For

You should exchange your life insurance policy only when you determine, after knowing all of the facts that the exchange is better for you and not just better for the person who is trying to sell the policy to you.

Both variable life insurance and variable universal life insurance are securities. Those who offer these products must follow SEC, FINRA, and state securities regulations, in addition to state insurance law. This means that a broker must tell you the important facts about the pros and cons of the exchange. Your broker or insurance agent should recommend such an exchange only if it is in your best interest and only after evaluating your personal and financial situation and needs, tolerance for risk, and the financial ability to pay for the proposed insurance policy.

Your broker or insurance agent may recommend that you use insurance policy values, such as loans or withdrawals, to pay premiums for a new life insurance policy. This activity is generally called "financing" premiums. It may not be appropriate for you. For example, withdrawals from existing policies may be subject to federal income tax and may reduce the death benefit. Borrowing money from an existing policy will almost certainly reduce the death benefit. Withdrawals or loans may make it more difficult to keep the original policy in force without additional out-of-pocket premium payments. If you can't keep the original policy in force, you will lose the insurance protection and the loans themselves may give rise to tax consequences. Remember for a transaction to qualify as a 1035 exchange, the old policy must actually be exchanged for the new policy. Many states and brokerage firms require forms to reflect customer acknowledgement of a replacement transaction. These forms typically are signed by the insurance policy owner and the broker or agent. These forms may provide a comparison of the features and costs of an existing policy to a proposed policy, and point out what you need to focus on when considering an exchange. Some brokerage firms may provide brochures or educational material designed to outline the possible advantages and disadvantages of the transaction. You should review these forms and materials closely.

Regardless of whether such forms are provided, you should specifically ask the person recommending that you exchange or replace your existing policy to provide you with illustrations for your existing policy and the new policy. You should also ask:

• What is the total cost to me of this exchange?

• What are the new features being offered? Why do I need those features?

• Are these features worth the cost?

• Can the existing policy be modified or supplemented to provide some or all of these same features?

• Will you be paid a commission for the exchange, and if so, how much is it?

You should not sign any exchange form or agree to exchange or purchase an insurance policy until you study all of the options carefully, have all of your questions answered, and are satisfied that the exchange is better than keeping your current policy.

If You Have Questions or Complaints

If you have questions or complaints about a life insurance policy exchange, you can contact FINRA, the SEC, your state securities administrator, or your state insurance commissioner.

Census Bureau: Number of U.S. Uninsured Rises to 47 Million Americans are Uninsured: Almost 5 Percent Increase Since 2005

2011-10-04T23:15:00.000-07:00

For the sixth consecutive year, the number of Americans living without health insurance has risen, according to new U.S. Census Bureau data. Approximately 2.2 million people were added to the uninsurance rolls in 2006 — the largest one-year increase in the number of uninsured Americans since 2002.

Annual Census Bureau estimates released in August show 47 million people, or 15.8 percent of the U.S. population, were without health insurance during 2006 — a 4.9 percent increase. In 2005, census figures showed that 44.8 million people, or about 15.3 percent of the population, lacked health insurance coverage.

The number of uninsured Americans has increased 22 percent since 2000, at which time 38.4 million people lacked health insurance.

Fewer Americans had employer-based coverage in 2006, the new data show. The percentage of people covered by employer plans fell from 60.2 percent in 2005 to 59.7 percent in 2006, according to the report, "Income, Poverty and Health Insurance Coverage in the United States."

Also of note, more children were without health insurance in 2006, the census data showed. The percentage of uninsured children younger than 18 rose from 10.9 percent in 2005 to 11.7 percent in 2006. According to the data, children ages 12–17 were more likely to be uninsured than children younger than age 12.

In response to the new data, dozens of health care organizations, including APHA, issued statements criticizing the nation's troubled health care system and urging Congress to reauthorize and strengthen the State Children's Health Insurance Program, which was due to expire Sept. 30. More than 6.6 million children in the United States were covered by the federal children's program, known as SCHIP, at some point during 2006. Since Congress first authorized SCHIP in 1997, the number of uninsured children in America has fallen by 24 percent.

In an Association news release, APHA Executive Director Georges Benjamin, MD, FACP, called the new uninsurance rate "a travesty."

"Access to health care is critical, especially for children," Benjamin said. "Children who are uninsured are more than three times less likely to have seen a doctor in the last year, and have a higher incidence of preventable disease than insured children."

Benjamin urged Congress to "forward the strongest possible SCHIP bill to the president for his signature."

According to the Commonwealth Fund, the difficult nature of obtaining and keeping health insurance coverage in entry-level jobs has resulted in major increases in the numbers of uninsured younger adults ages 25–34 and uninsured older adults ages 45–64. The new census data revealed that those hardest hit in 2006 were families with incomes between $25,000 and $75,000, but even when family income exceeded $75,000, the numbers of uninsured Americans grew by 1.3 million in 2006, suggesting that family premiums are becoming increasingly unaffordable, especially when employers do not provide coverage, the organization stated.

However, Commonwealth Fund President Karen Davis, PhD, said the jump in uninsured children is the new data's "most disturbing" finding. The number of uninsured children younger than 18 rose from 8 million in 2005 to 8.7 million in 2006.

"That's a jump of 9 percent in one year, and all of this was attributable to a decline in employer coverage," Davis told The Nation's Health.

The numbers of uninsured children would have been much worse if Medicaid and SCHIP had not covered an additional 5 million children over the six-year period from 2000 to 2006, Davis said, "because it was a period when employers were really dropping dependent coverage."

Davis said earlier data show that employer coverage is much more limited for children at less than 300 percent of the poverty level, "so reauthorization of SCHIP, with adequate funding to cover uninsured children, is essential to prevent a reversal of progress made through public programs in the past six years," Davis said.

Among children, the likelihood of health care coverage in 2006 varied by poverty status, age and race. Children in poverty were more likely to be uninsured than the overall population of children. While 7.3 percent of white children were uninsured in 2006, 22.1 percent of Hispanic children lacked coverage, as did 14.1 percent of black children and 11.4 percent of Asian children.

Families USA, a national health care consumer advocacy group, said the "epidemic" of uninsurance has reached crisis proportions. The number of uninsured Americans exceeds the cumulative population of 24 states and the District of Columbia, said Kathleen Stoll, director of health policy for Families USA.

The data "underscore the critical role that public programs such as Medicaid and SCHIP play in providing a health care safety net for millions of Americans," Stoll said in a statement.

Despite SCHIP's earlier success in decreasing the number of uninsured children, the number of uninsured children rose for the second consecutive year in 2006, Stoll said, again pinning the increase on the decline in employer-based coverage.

"SCHIP resources must be increased to meet the health care needs of the increasing number of uninsured children," Stoll said.

The likelihood of having health coverage rises with income levels. However, while the nation's official poverty rate declined slightly for the first time this decade, decreasing from 12.6 percent in 2005 to 12.3 percent in 2006, the actual number of people in poverty in 2006 — 36.5 million — was not statistically different from 2005, according to the Census Bureau.

The number of uninsured full-time workers increased from 20.8 million in 2005 to 22 million in 2006, while the number of uninsured part-time workers, 5.6 million, remained the same as in 2005. The number of Americans insured by Medicaid and Medicare in 2006 also remained the same as in 2005, at 38.3 million and 40.3 million respectively.

Between 2005 and 2006, the number of U.S.-born residents who were uninsured increased from 33 million to 34.4 million. The number of foreign-born people who lacked coverage rose from 11.8 million in 2005 to 12.6 million in 2006. People living in the nation's "principal" cities in 2006 had a higher rate of uninsurance than people living in the suburbs, according to the data.

The Midwest had the lowest uninsured rate in 2006, with 11.4 percent of Midwesterners lacking coverage, as compared with 12.3 percent of people in the Northeast, 17.9 percent of people in the West and 19 percent of people in the South.

Based on a three-year average from 2004 to 2006, Texas was home to the highest percentage of uninsured people, with a staggering 24.1 percent of Texans lacking coverage. Conversely, the nation's lowest uninsurance rates in 2006 were in Minnesota, Hawaii, Iowa, Wisconsin and Maine.

For a copy of the census report, visit www.census.gov. For more news from The Nation's Health, visit www.thenationshealth.org.

Stay insured: new penalties for motor vehicles without insurance

2011-10-03T00:30:00.000-07:00

The new vehicle insurance law means that the registered keeper of a vehicle must keep it insured unless they've made a Statutory Off Road Notification (SORN). If you're not insured and haven't made a SORN, you could face a penalty. Find out what the change in the law means for you.

Stay insured: new penalties for motor vehicles without insurance

The new vehicle insurance law - don't be caught out

Stay insured - stay legal

Watch a video on the new rules on being insured and penalties you could face

Stay insured

If you're the registered keeper of a vehicle, it must be insured at all times.

The exceptions are:

if you have made a SORN for the vehicle

if your vehicle has been kept off-road since before SORN came into force on 31 January 1998 – unless it was brought back into use

if your vehicle is recorded as stolen, passed or sold to the motor trade or between registered keepers

if your vehicle is recorded scrapped or permanently exported by the Driver and Vehicle Licensing (DVLA)

What will happen if your vehicle doesn't have insurance

From the end of June 2011 Insurance Advisory Letters (IAL) will be issued by the Motor Insurers' Bureau to the registered keepers of uninsured vehicles. This will be following a check of the Motor Insurance Database (MID) - the UK's central record of vehicle insurance. The IAL will advise the registered keeper that their vehicle appears to have no insurance and what actions to take to avoid receiving a fixed penalty from DVLA.

If a vehicle does not have insurance, the registered keeper could:

receive a fixed penalty of £100

have their vehicle wheel-clamped, impounded, or destroyed

face a court prosecution, with a possible maximum fine of £1000

Payment of a penalty does not replace the need for motor insurance.

How to avoid a penalty

The details of all insured vehicles should be on the MID. You can check that your motor insurance details are on the database and are correct by following the link below.

Check your vehicle is insured - askMID Check the Motor Insurance Database now Opens new window

If the details aren't correct, or are not on the database, you should contact your insurer immediately. Only your insurer can update the MID's information.

If not already insured:

insure your vehicle immediately

make a SORN, if the vehicle is not used on the road

notify DVLA if you are no longer the registered keeper

Failure to take one of these actions will result in a £100 penalty.

Could you be breaking the law?

If you're not using your vehicle, you should make a SORN. If you are using it, it must be insured

When to make a SORN

The change in the law means, you will only be able to take your vehicle off the road and cancel your insurance by returning your tax disc to DVLA.

It must be returned on a V14 (application form for a refund of a tax disc) and SORN declared at the same time.

Download 'Apply for a vehicle licence refund (form V14)' (PDF, 170K)

How does this law affect a vehicle used only in the summer?

If you have a vehicle that is still taxed but not insured, you could face a penalty. This includes vintage and classic cars, motorbikes and motor homes – all vehicles that people sometimes leave uninsured for part of the year. If this applies to you, you need to return the tax disc on a V14 (including nil value discs) and declare SORN at the same time.

Are vintage/classic cars affected?

If you have a vehicle that was manufactured before 1 January 1973 that has a 'nil value tax disc' it is still considered by DVLA as taxed. If your vehicle is taxed it therefore must be insured unless you return your tax disc on a V14 and declare SORN at the same time.

How does this affect pre-SORN vehicles?

Vehicles which have been kept off-road since before SORN came into force on 31 January 1998 are exempt from this law. If they are brought back into use they will no longer be exempt. If you want to bring the vehicle back into use, you will need to tax and insure it. Follow the link below to do this.

Apply for a tax disc onlineOpens new window

What if you have a personalised registration on your vehicle?

You should inform your insurance company if you change the registration number of your vehicle. If you do not you could receive an Insurance Advisory Letter (IAL) to say your vehicle is shown as uninsured.

Personalised reg and number plates

Why would someone receive a letter about a vehicle they no longer have?

When the vehicle record was compared to the MID, they were shown as the registered keeper. This is why the letter was issued. The IAL will explain what action needs to be taken to notify change of keeper. Follow the links below if you no longer have the vehicle.

How to notify DVLA if you sell your vehicle

What to do if your vehicle is scrapped or written off

What if I am moving abroad and taking my vehicle?

If the vehicle will be abroad for less than six months your vehicle is still subject to UK motoring laws and would need to be insured.

If permanently moving abroad, follow the link below for further details.

Taking a vehicle out of the UK permanently or temporarily

Does this change affect the Off Road Register?

Off road bikes and construction machinery on the Off Road Register are not affected by the change in the law. If they are later registered for use on the public road they will be affected by the change.

Where does the new law apply?

The new law will apply in England, Scotland and Wales. It will not apply in Northern Ireland, the Channel Islands or the Isle of Man.

Points to remember

To summarise if your vehicle is on the road it must be taxed and insured at all times or you may face a penalty.

If your vehicle is:

taxed and insured – you do not need to do anything until your tax and insurance runs out

taxed and uninsured - you must insure your vehicle or make a refund application with a SORN declaration to DVLA if your vehicle is off-road

not taxed and uninsured – you must make a SORN and keep the vehicle off the road

not taxed and insured – you must make a SORN and keep your vehicle off the road

How to make a SORN (Statutory Off Road Notification)

Getting the best insurance deal

You can get expert tips and advice on reducing your insurance costs from the Stay Insured website. Follow the link below to find out more.

Auto Insurance Rate Comparisons for 25 Major US Cities

2011-09-30T23:39:00.001-07:00

Columbus (zip code 43215) … US$392 to $2518, average price is $1103

Milwaukee (53202) … $424 to $2768, $1237

Kansas City (64105) … $428 to $2856, $1321

Charlotte (28202) … $439 to $3460, $1379

Memphis (38103) … $444 to $2786, $1286

Los Angeles (90013) … $462 to $3520, $1483

Indianapolis (46224) … $463 to $2898, $1313

Albuquerque (87102) … $478 to $3462, $1475

Denver (80202) … $490 to $3123, $1345

Atlanta (30312) … $502 to $2942, $1420

Chicago (60610) … $511 to $2714, $1276

Phoenix (85013) … $522 to $3338, $1540

Oklahoma City (73102) … $524 to $3556, $1561

Philadelphia (19107) … $552 to $4514, $1846

Portland (97205) … $548 to $3242, $1445

Houston (75207) … $553 to $3517, $1562

Boston (02205) … $585 to $3559, $1581

Seattle (98104) … $589 to $3472, $1590

Las Vegas (89169) … $668 to $4000, $1770

Jacksonville (32207) … $709 to $3682, $1663

Baltimore (21297) … $710 to $4306, $1906

Louisville (40202) … $733 to $3399, $1640

Detroit (48227) … $746 to $3798, $1712

New York (10001) … $764 to $5750, $2559

Washington, DC (20005) … $914 to $6142, $2577.

Auto Insurance Online

2011-09-30T23:29:00.000-07:00

BUY CAR INSURANCE
Car insurance, which is also given the name of vehicle insurance, auto insurance and motor insurance, refers to an insurance premium or policy that protects owned road vehicles including cars, motorcycles, bicycles, vans, trucks and more. The common function for joining a car insurance company is to be offered protection from extensive damages and physical injuries caused by road accidents, such as traffic collisions.

If you are eager to keep away from strict liabilities and be helped if your broken car requires repairing, choosing the option to buy car insurance online is a great move to reduce your strain and troubles. But there are however some things you need to be aware of.

Third Party Personal Insurance
Just like the way laws differ from state to state in Australia, so does car insurance and their car insurance quotes.

In the state of South Australia, if you are a driver over 16 years old, the Motor Accident Commission will include a Third Party Personal insurance with the licence registration charge. A similar scheme goes for the state of Western Australia too.

In the state of Victoria, a Third Party Personal insurance is included by the Transport Accident Commission. The costs for it are part of a road levy paid during the registration of vehicle fees.

In the state of New South Wales, having a Compulsory Third Party Insurance (also known as CTP Insurance) is a compulsory obligation for every cars that a person owns. Because of such rule, it is in breach of the law if a motorist drives their vehicle if they don’t have a CTP. Green Slip, another common name for CTP Insurance due to the colour of their printed pages, must be acquired from one of the licensed insurers such as Suncorp, GIO, AAMI, Allianz and CIC.

In the state of Queensland, it is part of the compulsory requirements when registering a car to have a CTP too. However, drivers are given the opportunity to choose their own insurance companies. It should be noted, however, the government controls the price and quotes.

As a note, Third Party Personal insurance can just cover small personal injuries and liabilities. Bigger damages like floods, fire, storms, collision, theft, etc. will not be covered. If you wish to have them covered too, it must be purchased separately.

No Claims Bonus Protection (NCB)
A defence service called No Claims Bonus Protection, also known as NCB for short, is a protection obtained by paying excess fees after claiming damages from an disaster suffered by your car. Your fees can go down to around 55% of its normal cost, depending on what scale your claim falls into. Getting a NCB is a must if you hope to prevent yourself from losing money.

If you do not claim for a NCB for a few years, some companies may grant you a NCB protection for life at no extra charges.

Here is a list of car insurance companies for your references

1Cover Travel Insurance
1Cover is a cheap and simple insurance company. It seems that if your lost is small, such as a small illness or injury, their payments are sent to you fast and easy. However if it is something greater, it may take months for them to get back to you ...

AAMI Car Insurance
AAMI insurance is a big company and would be impossible for them to pay for every claim and repair every damage. With the length of the company’s life and number of complains, it is pretty decent. Only a handful ever goes through a nightmare, and smaller amounts have that nightmare turn into a reality ...

GIO Insurance Review
GIO Insurance has their ups and downs. It seems that before they send your claims for your damages, they will undergo many investigations to justify that it was out of your control to prevent it. Their requirements may be a bit silly at times. There are a high percentage of reported customers that their claims were denied, but others had experienced some fuss-less smooth transactions ...

U.S. insurance companies

2011-09-30T21:53:00.001-07:00

Main article: Insurance in the United States
21st Century Insurance
AccuQuote
Aflac
Alleghany Corporation
Allied Insurance
Allstate
American Automobile Association
American Family Insurance
American Income Life Insurance Company
American International Group (AIG)
American National Insurance Company
Ameritas
Amica Mutual Insurance
Aon Corporation
Assurant
Assurity
Auto-Owners Insurance
AXA Equitable Life Insurance Company
Bankers Life and Casualty Company
Berkshire Hathaway
California Casualty
Capital Insurance Group
Cincinnati Insurance Company
CNA Financial
Colonial Life & Accident Insurance Company
Commerce Insurance Group
Conseco
Country Financial
Chartis
Chubb Corp.
Encompass Insurance Company
Erie Insurance Group
Esurance
Everest Re Group
Evergreen USA RRG
Farmers Insurance Group
Federated Mutual Insurance Company
GAINSCO
GEICO
General Re
Genworth Financial
GMAC Insurance
Guardian Life Insurance Company of America
Hanover Insurance
The Hartford
HCC Insurance Holdings
Hereford Insurance Company
Infinity Property & Casualty Corporation
Insurance Company of the West (ICW Group)
International Fidelity Insurance Company
Illinois Mutual
Jackson National Life
John Hancock Insurance
Kemper Insurance
K&K Insurance
La Playa
lgap Insurance
Knights of Columbus Insurance
Liberty Mutual
Lincoln National Corporation
Markel Corporation
MassMutual Financial Group
Merchants Insurance Group
Mercury Insurance Group
MetLife
Mutual of America
Mutual of Omaha
Nationwide Mutual Insurance Company
New Jersey Manufacturers Insurance Company
New York Life Insurance Company
Northwestern Mutual
Ohio National
OneBeacon
Oxford Health Plans
Pacific Life
PEMCO
Penn Mutual
Primerica
Principal Financial Group
Progressive
Protective Life
Prudential Financial
The Regence Group
Reliance Insurance Company
Response Insurance
RLI Corp.
Safe Auto Insurance Company
Safeco
Safeway Insurance Group
Sentry Insurance
Selective Insurance
Seven Corners Inc
Shelter Insurance
Southern Aid and Insurance Company
Standard Insurance Company
State Farm Insurance
Symetra
Tri-State Consumer Insurance Company
TIAA-CREF
The Travelers Companies
Uniguard - Headquarter in greater Seattle area
United Auto Insurance Company
Unitrin Direct Auto Insurance
Unum
Vantislife Insurance Company
USAA
Wawanesa Insurance USA (CA and OR)
West Coast Life
Western Mutual Insurance Group
Western & Southern Financial Group
Westfield Insurance
Western Reserve Life Insurance Company
White Mountains Insurance Group

Life Insurance for Senior Citizens

2011-09-30T08:47:00.000-07:00

If you’re over age 65 and need life insurance, there are insurance companies that make better offers for seniors.

There are a number of insurance co's that offer guaranteed Universal Lifecoverage that can be less expensive for Seniors than term insurance.

Things like cholesterol levels, blood pressure, family history issues and height and weight should be more liberal for senior citizens than they are for younger adults.

It has never been as easy to compare rates for your parents. Obtaining life insurance for parents is now easy.
The one downfall to deferred is that it is not available to those over the age of 85. Once you reach your 85th birthday, you will find it impossible to receive inexpensive life insurance. In the end, it is a game of odds. People are living longer, so will insurance rates decline as the average life span increases?

The Now,

Affordable Life Insurance: Where do I find them?

Affordable life insurances are everywhere, and the only thing you have to do is to choose wisely. Ask yourself: which among the many life insurances have the guaranteed rates? Many insurance companies even make things easier for their clients because they even offer premiums that are payable for only a limited number of years yet the benefits are still huge.
Of course your preferred rate for a life insurance is the most affordable life insurance. Even though you have medical care benefits you can not count on it all the time of your life. And if you are to consider the government’s health insurance plan for elders and senior citizens you will realize that such insurance is designed to cover a short-term rehabilitation and not actually what many people look for, which is a long-term care insurance—in short, an affordable life insurance.
However, to truly get benefited in your life insurance (after so many thorough comparison studies), you have to think wisely. To avoid tripping over in resentful situation give your preference in a life insurance that allows periodic payment over monthly payment. Why is this? Affordable life insurance allows periodic payment that can be done annually or biannually and they are typically bargain-basement priced which makes it ever more convenient in your part.

Claims for Unemployment Insurance Remain Unchanged from Last Week

2009-11-19T09:37:00.000-08:00

CNN is reporting that the number of first-time claims made for unemployment insurance remained unchanged in comparison to last week

The number of new applications that were filed by first-timers for unemployment insurance over the past week remained unchanged in comparison to the number of applications that were reported for the previous week, which ended on November 14th. The statistics were unveiled by a U.S. Labor Department report that was released on Thursday, indicating that new claims for unemployment benefits went from 505,000 to 505,000, according to CNN.com.

Expert economist Ian Shepherdson provided a comment about the research that was conducted by the U.S. Labor Department, stating, “After two hefty declines, claims were due a pause this week. Even when the underlying trend is clear, claims tend not to run in the same direction week after week. [Claims] are heading in the right direction.”

While the statistics appear to be a cause of optimism for some, there are skeptics who are under the impression that the decline in claims for unemployment insurance are a result of those whose benefits have expired. The recently extended benefits that were revealed by President Obama’s administration were not included in the Labor Department’s report.

There were also 18 states that reported an increase in claims by first-timers for unemployment benefits by more than 1,000, including New York, New Jersey, Philadelphia, Michigan and Ohio, according to CNN.com.

Health Care Reform -- The Battle Has Just Begun

2009-11-17T08:50:00.000-08:00

The battle for health care reform is going into the home stretch but by no means can a conclusion be drawn that we will see it and thus can rest our wary heads. As evidence of this, a huge rally is scheduled for November 17 in Chicago at meetings of the American Health Insurance Plans headed by Karen Ignani. If anything, the battle lines have formed that pit those in corporate America against the millions at the grassroots level. Who will win out -- those who wish to ensure healthcare for all Americans, as if a right, or a community service like riding the municipal bus to work or bringing heat to warm our homes, or those in the insurance industry whose bottom lines a recent Goldman Sachs report states will be adversely impacted by real reform and that the best option from the insurance industry perspective is to have no public option at all? Note, too, that the insurance lobbyists have spent upwards of $120 million to lobby Congress against reform. And in recent days, big insurance companies are emailing all of their thousands of employees to become their advocates to Members of Congress. Or, how about the threats of big pharma to pull out of the deal it made with the White House where it has committed $80 billion to shore up the donut hole in prescription drugs under Medicare so long as the government does not use its muscle to force drug prices to be negotiated. Funny that the drug manufacturers don't tell seniors that they (pharmaceutical houses) stand to make over $130 billion on an ongoing basis by committing a mere $80 billion. Looks like a good return on investment, huh? But does pharma think we can be fooled by thinking we are swayed by name brands here? Hardly.

To be sure, without incredible support and advocacy from grassroots support and organizational effort there, the progress to date for healthcare reform in the United States would have been a pipe dream. Not since 1965 when Medicare was enacted, and not since 1935 when Social Security became the law of the land, has a social program like reforming the health care system come as close as it has to enable all Americans to afford and access health care. But to become complacent because one chamber of our Congress has passed a bill is like looking at a fox in sheep's clothing guarding the chicken coop.

No doubt we will see considerable new regulations imposed on insurers like precluding pre-existing conditions from barring coverage; or seeing limits on what we pay for out of pocket expenses; or knowing that an insurance company will not be able to rescind an insurance policy once care and treatment is provided. But before you give out a hoot and holler here, know that such "goodies" increase exposures to the insurance industry that will cost them more money than they now spend, and take away from their bottom lines. That is okay with them so long as they have no real competitive check to their ability to raise premiums when they want in order to recapture some of this lost income. To state this slightly differently, we cannot let the industry preemptively gouge consumers while we wait for a public plan. This is where the public option comes in, and not one defined by a "trigger," or an opt-out, or opt-in, plan being tossed around in the Senate these days. Thus, while we may see insurance reforms coming our way once and for all, we will not yet see insurance industry reform until we have true competition to what private insurers have to offer us in the marketplace. All Americans must know that the (American) way to create competition in the private market is to have a public offering as a choice among choices. This is another way of saying to offer a Medicare like system for those not considered eligible for the present Medicare program.

Another fact that goes unnoticed is that a strong and effective public option for all spreads the risk for insuring entities. The more the risk is spread, the less the cost of the product will be for all. Insurance companies don't tell us this. A colleague from Illinois, Andy Kurz, a retired executive from a Blue Cross/Blue Shield company, has graphically shown that of the nation's 305 million in population, some 100 million Americans could become eligible to participate in it. This, then, is the goal for Members of Congress to consider when next debating the merits of a public option. Hand in hand with this is to ensure that the exemption from the antitrust laws that the insurance industry has enjoyed since 1945 is taken away.

One final thought. If we are fortunate enough to see President Obama sign a bill into law within the next couple of months, rest assured that those whose bottom lines will diminish because of it will not stop at finding ways to gain additional revenues by gouging us. That is why we need to ensure that key provisions become effective immediately upon a bill becoming law. As an example of what I am saying, look at what big banks did with the bailout money that came their way -- pocketing it in the form of big bonuses instead of ensuring community banks received their fair share so as to allow their small business customers to borrow from them and grow their businesses. Or, look at what the credit card companies have been doing in charging fees and costs (even for overdraft protection that fortunately is being corrected now through legislation) -- all to obtain additional revenues before the new law capping interest rate charges takes effect this coming February. And if you doubt what I am saying about insurers, look to the mails this Fall and see how much your premiums have gone up from a year ago!

So, to those who want real health care reform, you must not rest of your laurels. We cannot afford to become couch potatoes on this subject. The battle has just begun, but the "war" can surely be won by heeding the words of the famous New York Yankee catcher, Yogi Berra: "It ain't over 'till it's over."

Home Business & Finance News U.S. Politics International Technology Entertainment Sports Lifestyle Oddly Enough Health Science Special Coverage Video

2009-11-04T03:30:00.000-08:00

Generali France, the second largest general insurer in France and one of the main foreign subsidiaries of the Generali Group, the largest European life
insurer, has unveiled a new life insurance application for iPhone* which was created and implemented with the help of Accenture (NYSE: ACN).

The new application, which will be made available in the beginning of 2010, will provide Generali France`s network of financial advisors real-time access through
their mobile device to their client portfolio as well as detailed information for each client account, including savings, payment history, investment
portfolios and the financial performance of each fund in which savings are invested. A "business-to-consumer" version will also be made available for the
clients of Generali France`s network of financial advisors and for the direct clients of Generali France`s Internet subsidiary, who will have direct access to
their own accounts.

Drawing on its technology expertise and deep knowledge of the financial services industry, Accenture helped Generali France define the overall business and
information technology (IT) scope of the new life insurance application for iPhone. Accenture assisted Generali France in defining the targeted audience for
the application, the business needs, the "must-have" functionalities that would benefit end-users, and the required IT architecture. Accenture also designed the
application`s user-friendly screen interfaces.

"Following an Accenture workshop on how changes in consumer behavior are driven by the increased usage of smartphones, Generali France decided to work with the
company to develop concrete business applications for its life insurance operations," said Stéphane Dedeyan, a member of the Board of Management of
Generali France. "This new application for iPhone will be particularly helpful to our financial advisers, who are looking for innovative ways to stay close to
their clients, as well as to our clients who will be able to directly access their account in a user-friendly way."

Khalid Lahraoui, a senior executive in Accenture`s Financial Services group said: "By implementing one of the first life insurance applications for iPhone
and providing financial advisers and clients with an easy-to-use application that enables them to access the information they need no matter where they are,
Generali France is demonstrating its ability to innovate and take advantage of the increased use of smartphones to give customers a distinctly different
customer experience."

The new application will be enhanced over time with new features such as news alerts and a savings simulator. A Property and Casualty version which would
enable Generali France`s clients to manage their claims, from claims declaration to settlement, is being studied by the insurer.

* iPhone is a trademark of Apple Inc.

About Generali France

Generali France is one of the most important foreign subsidiaries of the Generali Group, the third largest European insurer present in 65 countries and a
2008 premium income of € 69 billion. Operating in the French market since 1832, Generali France is today the second largest general insurer in the country. The
company operates in all branches of insurance both through its nearly 8,000 employees and also through diversified distribution networks - 2,200 salaried
consultants, 1,200 general agents, brokers, 1,500 self-employed finance managers, major banking partners, and the Internet - which are among the most
powerful networks in France. More information at www.generali.fr

About Accenture

Accenture is a global management consulting, technology services and outsourcing company. Combining unparalleled experience, comprehensive capabilities across
all industries and business functions, and extensive research on the world`s most successful companies, Accenture collaborates with clients to help them
become high-performance businesses and governments. With approximately 177,000 people serving clients in more than 120 countries, the company generated net revenues of US$21.58 billion for the fiscal year ended Aug. 31, 2009.

Health care: Most wouldn't have public option

2009-10-29T04:31:00.000-07:00

Senate Majority Leader Harry Reid's gambit to include a government-run insurance option in health care legislation has given a fresh tailwind to the idea despite opposition from conservatives.

But lost amid the ideological battle for or against a public option is a key overlooked fact: The vast majority of Americans would have no access to a public option even under its most expansive versions.

House and Senate bills limit the option to the smallest businesses and to individuals who cannot get insurance, or whose health care costs exceed 12.5 percent of their income. Even seven years into an overhaul, an estimated 90 percent of Americans, including nearly everyone who has employer-based coverage now, would be shut out of a public option.

Those currently in other government programs, such as Medicare and the Veterans Administration, also would be excluded.

The public option under all bills would be offered through insurance exchanges, a Web-based market for health plans. But most people who are unhappy with the insurance they have now would be locked out of these exchanges, leaving many Americans who are watching the debate in for a big surprise.

Only a handful of senators, such as Ron Wyden, D-Ore., and Mary Landrieu, D-La., have focused on widening the exchanges where a public option might be available. Wyden wants everyone who now has employer-based coverage to have access to the exchange if they don't like their insurance companies, but his efforts have been lost amid the narrower fixation on the public option itself.

"When you ask people in a poll, 'Are you in favor of a public option that would be available to everybody,' they say, 'Yes,' " Wyden said. "I don't think they're going to feel the same way about a public option available to only 10 percent of the population."

Wyden, an iconoclastic liberal, questioned the basic assumption by his fellow Democrats that such a limited public option will provide adequate competition to private insurers.

"People are going to want choices, public choices and private choices, available to everybody, because that's how you're going to hold the insurance companies accountable," he said. "You can't expect that having 10 percent of the American people getting the public option will force major changes with the other 90 percent who aren't subjected to choices, public or private."

He pointed to another surprise that awaits the public: Even those who would have access to a public option may not be able to afford it.

Citing estimates that a family of four earning $66,000 could pay an estimated 19 percent of its income on health care under some bill versions, Wyden said, "I can tell you, Americans are not going to consider 19 percent of their income affordable coverage."

Many health care experts agree. "I'm afraid rude surprises could be around a lot of different corners in this debate," said Marian Mulkey, senior program officer for the California Health Care Foundation, an independent philanthropy group based in Oakland.

Mulkey said the public option has been "dominating the discussion to an extreme extent" and that its importance as a principle to liberals and conservatives may outweigh its actual effect, at least in the short run.

A public program might face the difficulties private insurers have in holding down costs. "It's not entirely clear that just because it's a public program, it will be able to negotiate lower payments to providers or somehow develop more efficient benefits in a way that will yield a more affordable plan," she said.

Health care consultant Robert Laszewski, head of Health Policy and Strategy Associates in Washington, said that even if a public option is 25 percent cheaper than a private plan, which averages $13,000 a year for a family of four, it still will cost $10,000 a year.

Under subsidies in the House bill, a family earning $55,000 would pay the first $5,500 of any premium, public or private, he said.

"How many families earning $55,000 a year do you know that have an extra $5,000 in their checking account?" he asked.

Sen. Sheldon Whitehouse, D-R.I., a big advocate of the public option, acknowledged that most people won't have access to it. The exchanges were kept very narrow, he said, because of the way the Congressional Budget Office analyzes budget costs.

"We have to live with CBO's numbers and that creates some constraints," Whitehouse said. "I hope that quickly the public option will begin to demonstrate that those concerns were not justified and those constraints can be lifted and we can extend the option to everybody, because that's what makes sense."

Ironically, the power of the exchanges to dismantle the current system of employer-based health care, which many economists cite as the root source of exploding costs, could raise budget costs if more people move onto the exchanges and possibly into a public option.

But whatever effect a public option may have on the government's costs, there is little disagreement that giving individuals more choices - public or private - through the exchanges would inject powerful competitive forces into the system that could lower costs for everyone.

House to reveal overhaul today

After months of tense negotiations and setbacks, House Speaker Nancy Pelosi, D-San Francisco, will unveil a sweeping health care overhaul plan today, with a vote possible in the House as early as next week.

Pelosi is in an all-out push to move the legislation, which will have a government-sponsored insurance plan available to some people but not the "robust" version tied to Medicare rates that Pelosi and liberals favored.

Instead, it will have rates negotiated by the secretary of Health and Human Services, as swing-state "Blue Dog" Democrats preferred. Leaders are also working furiously to assure moderate Democrats that no public funds would be used for abortion.

House and Senate leaders have cleared the calendar for a possible weekend session Nov. 7 and another possible House session just before Thanksgiving, and canceled a planned Veterans Day break.

House Democrats said Senate Majority Leader Harry Reid's move to include a public option in the Senate bill Monday made it easier for moderate House Democrats to vote for a public option.

More local residents lose health insurance as unemployment rises

2009-10-21T04:29:00.000-07:00

A new report estimates 12,100 Hawai'i residents lost their health insurance coverage this year as unemployment jumped.

The report by Families USA said the economic downturn and rising joblessness were responsible for the spike because most people's health insurance is tied to their work. The report estimates 93,400 people don't have coverage here.

"People who receive a pink slip experience a double whammy," said Ron Pollack, executive director of the Washington-based nonprofit that advocates for affordable health care for all.

"They not only lose their jobs but the usually lose their health coverage as well."

Hawai'i traditionally has had one of the lowest uninsured rates in the nation because of the 1974 Prepaid Health Care Act that requires employers to offer coverage to workers who regularly work 20 or more hours a week.

CAN PUBLIC HEALTH INSURANCE FIX HEALTH CARE?

2009-04-23T03:47:00.000-07:00

Years ago, a woman was wheeled into my E.R. in critical condition. She was comatose, and her blood pressure was sky high. I didn’t need a CAT scan to know what was wrong. A vessel deep in her brain had burst, filling her head with blood. She never had a chance.
When I broke the news to her sisters, I learned that she had stopped taking her blood pressure medicine several days before. Why? Although employed, she was uninsured. And when money got tight, she had to choose between buying medicine for herself or food for her kids. Like most moms, she put her children’s needs ahead of her own. She paid for the decision with her life.
This story illustrates what is wrong with America’s health care system. My patient got excellent, high-tech care, but too late to do any good. Ironically, my team’s futile effort to save her life cost far more money than the medicine she needed to stay healthy.
There is great health care in this country, but too often we fall short. According to the CIA’s World Factbook, 40 countries have lower infant mortality rates than ours. We rank 46th in the world for life expectancy at birth. A study of death rates from treatable health conditions ranked the U.S. 19th among 19 wealthy nations —- dead last.
One reason America scores so poorly is that we ration health care, based largely on ability to pay. Uninsured Americans get about half the care of insured Americans, so they tend to be sicker and to die sooner.
American health care is incredibly expensive. We pay $2.2 trillion per year —- about $7,400 per man, woman and child. That’s twice the median per capita spending of our global competitors —- the 30 industrialized nations of the Organization for Economic Cooperation and Development. We pay 16 times the OECD median for private health insurance, and twice as much out-of-pocket. France, Germany, Great Britain and Canada cover everyone, but we spend more public money on health care than they do.
Costs continue to rise. Just last week, The Wall Street Journal reported that some hospitals and big pharmaceutical companies are pushing hefty price increases to boost their earnings.
If these double-digit price increases stand, insurers will pass them on to employers, who will pass them on to us in higher co-pays and deductibles. Over the past nine years, employer-sponsored insurance premiums have risen six times faster than wages.
This can’t continue. Hard-working American families deserve better; so do American businesses that are struggling to compete in the global marketplace. To level the playing field, three things must happen:
First, we need fair rules that promote real competition.
Second, we need a public health insurance option that is affordable and always available. That way, employees of firms that don’t offer coverage and workers who are between jobs will have a competitive alternative to the overpriced and skimpy plans offered through the insurance market.
Third, your doctor needs up-to-date information on the best treatments, so he or she can identify the option that’s best for you.
Health care industry executives and their congressional allies oppose these measures. The outcome of this struggle may determine if you and I can get affordable coverage in the future.
To keep America strong, everyone needs access to quality, affordable care. The best way to do this is craft a uniquely American solution —- one that combines private-sector ingenuity with public-sector fairness