Businesses use life insurance to protect against financial uncertainty and secure their employees’ futures. Business life insurance, or corporate-owned life insurance (COLI), has served companies and employees for more than 80 years.

The ACLI (American Council of Life Insurers) provides a good definition of COLI. They say, “In general, under a COLI arrangement, an employer purchases a life insurance policy or policies on the lives of specific employees. The non-deductible premiums for the coverage are paid by the employer, and in the event of a covered employee’s death, the employer retains the proceeds of the policy. State law and federal tax code direct who may be insured, how the policy may be funded, as well as limitations on deductibility and borrowing. COLI helps employers meet future financial liabilities tied to foreseeable human events; such as premature death of a key employee, benefit costs, or business succession planning. Without access to permanent life insurance at a reasonable cost, companies may not have the capital to both pay future expenses and to keep operations afloat”

More after the jump…

The State of California has recognized the fact that health insurance is now out of reach for many working class families with children. Families that are not eligible for Medi-Cal health coverage because their household income is too high have a creative state-sponsored alternative. The Healthy Families Program is low cost insurance that provides health, dental and vision coverage to children who do not have insurance today and do not qualify for no-cost Medi-Cal.

When you enroll your children in Healthy Families, you choose the health, dental and vision insurance plans that will provide coverage for your children. This insurance pays most of your children’s costs for visits to doctors, dentists, and specialists. Coverage extends to clinics, laboratories, pharmacies and hospitals that are under contract with Healthy Families to provide services to the program’s enrollees.

More after the jump…

Small business owners should ask themselves: what happens to my company if something happens to a key employee or me?

While it’s a question many don’t like to think about, the answer can decide whether the company survives the loss — and whether a business owner puts his family at financial risk.

There are ways to provide protection, including key-man life insurance. Such coverage takes over should income be interrupted. And it’s not just business owners that need life insurance protection. The company’s top salesperson should also be covered. In fact, companies should look at insuring anyone who is integral to its financial success.

If you lose a key employee, key man life insurance will pay you for your lost profits, thereby buying you some time to replace the individual and get the business up and running again.

More after the jump…

In the mid-eighties, the California legislature was responsible for controlling insurance practices and residents of the state experienced a massive series of rate hikes over a three year period. In 1988 Californians passed Proposition 103, a state initiative that mandated a 20% rollback in auto insurance; applied state consumer protection and antitrust laws to the industry for the first time; required full disclosure of insurance rate information to the public; and made the Insurance Commissioner an elective post. The insurance companies spent $80 million trying to defeat the measure and lost.

As a result of Proposition 103, California auto insurance premiums, which were second highest in the nation prior to the initiative, dropped to 20th after the initiative passed. The average premium has fallen 22% in California, while it has risen an average 30% throughout the rest of the country since 1988.

One elected Insurance Commissioner was forced to resign in 2000 after stories surfaced that he had waived millions of dollars in earthquake claims in return for industry contributions to his political slush fund. The current Insurance Commissioner announced some new consumer-oriented policies in June and won a Democratic primary contest for Lieutenant Governor despite a last minute $2.5 million dollar media campaign against him funded by the insurance lobby.

More after the jump…

Las Vegas is number one in the nation in personal injury lawsuits, and the FBI is reportedly trying to find out why. Federal authorities want to know if local attorneys are conspiring with doctors to manipulate the disposition of personal injury awards, which, if true, contributes to the ever spiraling cost of health insurance.

Hundreds of millions of dollars in personal injury awards have allegedly been generated by a particular group of 7 lawyers and at least 16 doctors. Federal investigators continue to probe the case and aren’t commenting much.

The Nevada Insurance Council has been making noise about this issue for some time. Spokesman Bob Feldman said, “I am aware they were conducting a rather thorough investigation.” Feldman says he and other Nevada insurance professionals have been raising this matter with law enforcement for years and that he hopes the FBI is taking a hard look. For every 100 property damage cases in Clark County, he says, nearly half become personal injury cases.

More after the jump..

Survivorship life insurance is a tool to help you protect your wealth from the IRS. If you don’t plan properly, some of your money could go to the IRS at your death. While estate taxes may be inevitable, survivorship life insurance can be a way to replace a portion of your estate.

Here’s how it works: survivorship life insurance insures two individuals in one insurance plan and pays the death benefit after the death of the second insured. As a result, the cost is more affordable than purchasing two separate life insurance policies.

So, do you need to worry about estate taxes? It depends upon your estate’s value. In 1975,only 350,000 households boasted net worths in excess of $1 million. Today, that once-exclusive Millionaires Club numbers more than 3.5 million.

Keep in mind that your estate consists of:
-Home
-Cash/Money Market Accounts
-Stock/Bond Portfolios
-Pension/IRA Accounts
-Business Interests
-Other Real Estate
-Life Insurance Proceeds
-Automobiles/Artwork/Other Collectibles
-Gross Estate

It’s a well-accepted fact that in the mutual fund arena, all things being equal, a “no-load” or “low-load” fund has lower expenses, as it saves the cost of a commissioned sales representative. These savings are routinely passed through to the investor/customer in the form of lower fees and, in turn, result in higher returns… more money in your account in the long run!

Assuming you don’t need the guidance of a financial services representative to help you with asset allocation and/or any of the other aspects of choosing a fund, and if you’re willing and able to “do it yourself”, which, while not difficult, requires a bit of self education, you can save some money, earn more money and avail yourself of “the better deal”, if you will.

That being said, all too many so-called financial “experts”, journalists, and advisors who may not be versed on how things work in the life insurance business routinely make the seemingly logical, but INCORRECT assumption that things work the same way with term life insurance as they do with mutual funds. I.e. Do it yourself, find a low-load or no-load life insurance product, and you’ll be on your way to saving money. This is simply NOT the case.

More after the jump…

Comparing health insurance companies in Arizona just got a whole lot easier, thanks to a state agency. The Arizona Department of Insurance has created a “2005 Report on Arizona Health Insurers.” The new consumer publication is designed to help state residents in comparing complaints, health care appeals, market share and enforcement actions involving the largest health insurers doing business in Arizona.

Arizona’s Insurance Director Christina Urias said that the department receives more consumer inquiries about health insurance than any other type. One can assume that the great majority of these “inquiries” are complaints. The consumer guide produced by the agency offers comparative information about the major health insurers and HMOs in the state. The 27 insurers in the guide all have at least 2,500 enrollees in Arizona and represent about 75 percent of the state’s health insurance market.

More after the jump…

Business owners struggling to find a way to maintain employee health coverage are beginning to turn to “mini-meds” — limited benefit health insurance policies.

Standard HMO health insurance plans cover doctors, specialists and between 80 percent and 100 percent for hospital confinement. Mini-meds are not intended to be someone’s only source of payment. These policies help defray the costs for an employee and family members in several areas:

* Outpatient Sickness. This is a section that allows patients to go to a walk-in clinic or emergency room or make a physician’s appointment and see a doctor in the office. Visits per year may be limited.

More after the jump…

Have you ever gotten a phone calls from your credit card or mortgage company offering inexpensive insurance that will pay off your balance in the event that you die? Sounds like the deal of the century. Just 39 cents, or less, per $1,000 you owe each month to protect your family.

Don’t fall into their trap! The key reason for life insurance is to protect your family from financial disaster if something were to happen to you unexpectedly. A lot of the life insurance being sold today is duplicative of the protection you would get from a term life insurance policy.

So what policies should you think twice about?

More after the jump…