At CDA Inc., we are here to help answer any questions you may have regarding your insurance. Please feel free to call at (770) 449-7369 with any question. Also, for your convenience, we have provided the most frequently asked question on health insurance and life insurance below.
What’s the latest with the Affordable Care Act?
July 2014 the Obama administration postponed implementation of the “Play or Pay” guidelines for large employers. Companies with 50 or more full time equivalent employees will not need to provide affordable coverage meeting minimum standards to 95% or more of their employees until January 1, 2015.
Are the other timelines still in effect?
Yes. The individual mandate requiring coverage for most individuals who live in the US is still on schedule for January 1, 2014 implementation. Penalties remain the greater of $95 or 1% of income for the 2014 taxable year.
What is happening to smaller employers?
The SHOP exchanges are scheduled to be effective January 1, 2014 providing tax deductions to certain employers based on number of employees and average employee income. Multiple insurance carrier options are not scheduled to be effective until January 1, 2015.
Should we accept the early renewal option your insurer has offered?
Many individuals and companies will be offered an opportunity to renew their health insurance coverage at the end of 2013 under the current guidelines. As the 2014 plan designs have not been announced, and the renewal plans are not binding, we are encouraging our clients to consider carefully the benefits of retaining known benefits even as details of new plan designs are announced.
How much do we need?
What are you trying to protect? If it is a specific amount for a specific time, that’s what term insurance was designed for. If you are protecting life value, there are more cost efficient ways to provide permanent insurance. There are a variety of formulas to use to determine the amount at risk that needs protection. The easiest may be to:
1- Determine how much money your family or business needs each month to cover current expenses.
2- Factor in the loss of income as well as additional expenses the surviving member will need to continue.
3- Divide that number by a number representing a conservative interest rate and you will reach the principal you will need to provide the lost income at that interest rate.