Presented by RPW Solutions, LLC
EMPLOYERS
You already help your employees by providing them with retirement benefits such as a 401K plan which may include tools and resources for them to plan for a secure retirement. And they probably have choices and diversification options to minimize downsize portfolio risks that could blow a hole in their future financial security. But a major downside risk that they may not have made provision for in their financial planning is the risk that they may at some point need costly extended care that is not covered by health insurance and Medicare. We can show you how to help them close this major gap.
HelpCare Insurance
Most of your employees will live a long life and many at some point will need help with activites of daily living. That assistance can be very expensive and is not generally covered by Health Care Insurance. The only broad coverage for this big risk to your employees' financial security is Long Term Care Insurance. We refer to this as "HelpCare Insurance" . We think this better describes what the coverage provides: reimbursement for the expense of care providers to provide help with basic acitivities such as eating and dressing. Those expenses are likely to be tens of thousands of dollars a year and seriously jeopardize even well-funded retirement plans. That's one reason why you should consider adding HelpCare Insurance to your employee benefits portfolio. And there are other reasons as well:
- There are significant tax advantages for both employers and employees when this coverage is provided by employers.
- Pricing discounts are often available for worksite programs, making the coverage more affordable for your employees.
- Insurers generally have greater underwriting flexibility with worksite programs which may benefit some employees or family members.
- Coverage is fully portable at the same premium rates.
- This product is not service intensive and the guaranteed renewable, fixed pricing model means that annual renewal re-pricing does not occur.
- The coverage will be valued by your employees, particularly those who have had first hand experience with the care needs of a family member or friend.
- When explained with this descriptive label, HelpCare Insurance can be useful in employee retention and recruitment.
- HelpCare Insurance can mitigate productivity issues when an employee has a family member who is covered under this program needs care. Most insurers also provide useful information and referrals for family members who are not covered.
Flexible options to fit your business
A variety of Long Term Care Insurance products are available that can be configured by you to provide your employees with a HelpCare Insurance program that meets your objectives. The two broad categories of product types are:
- Traditional Long Term Care Insurance which focuses primarily on covering the risk of needing assistance with activities of daily living; and
- Asset Based or Hybrid Long Term Care Insurance which is a life insurance or annuity product that contains elements of long term care coverage in addition to providing cash values and death benefits.
Worksite programs almost universally utilize traditional Long Term Care Insurance but in certain circumstances a hybrid product might be used.
Employers may choose to fully pay for the coverage to maximize the tax advantages, particularly with respect to owners, executives and key employees as well as their spouses. At the other end of the spectrum, a worksite HelpCare Insurance program may be totally voluntary with premiums fully paid by the employees. It is also possible to establish a contributory program funded with contributions from both the employer and the employees. This can include a "core-plus-buy-up" design where the employer pays the premium for a base level of benefits and employees can opt to pay for higher levels of benefits.
Employers can select either a defined benefit level for all employees or a set of benefit options that employees can choose from. Benefit levels are defined by:
- The daily or monthly benefit limit, which is the maximum dollar amount that can be paid per day or per month;
- The benefit period, which is expressed as a number of years but is actually a factor used to calculate the maximum amount of benefit dollars that can be paid over the life of the policy. (For example, benefits in a 3-year benefit period policy are not limited by a 3-year calendar window of time; rather, the maximum amount of benefits would be calculated as 3 years times 365 days times the daily benefit level.)
- The Elimination Period (or Waiting Period), which is like a deductible and is the period of time after a covered event begins before benefit payments will start.
- Inflation protection, which defines whether and how the daily or monthly benefit limit will increase over time.
- Other options such as non-forfeiture options in the event of lapse or surrender, death benefits, shared care options (e.g., the ability of one insured who uses up all of their benefit to call upon the benefits of their spouse or partner) and several others.
Of course, one of the most important considerations for an employer is the choice of insurance carrier. We work with a number of highly rated insurance companies and we take great care to understand the relative strengths of each one for a particular situation. This includes their financial rating, pricing levels, underwriting criteria, commitment to the market, service capabilities, etc. We apply this knowledge to your situation to present you with the combination of plan design and insurance provider that best will best meet your needs and your budget.
