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Why Do I need Life Insurance?

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Why Do I Need…
Life Insurance?

Life insurance isn’t a pleasant thing to think about, and it may seem like an unnecessary expense. But if you have dependents who rely on you for financial support, then life insurance is really about protecting them in case something happens to you. Your designated beneficiary would collect a financial benefit upon your death.

Youth minister Preston Newby and his wife, Tara, met during college and were soon married. After visiting their local insurance agent to purchase auto and renters insurance, they decided to look into life insurance policies. With a 19-month-old son and another child on the way, life insurance policies made a lot of sense in case anything ever happened to either of them. Unfortunately, this worst-case scenario became reality a couple of months later.

While driving to Canada to visit Tara’s parents, a group of cars up ahead of the Newbys slammed on their brakes and veered to the right side of the road. After coming to a stop, Preston hopped out of the car to find out what happened. One of the cars had hit an elk, and when Preston realized a passenger was bleeding, he ran back to his car to tell Tara to dial 911. As she reached for her phone, a car flew by and hit Preston, killing him instantly.

Thanks to the life insurance policy the Newbys purchased months earlier, Tara was able to pay off the family’s existing debt and provide for her two young sons after Preston’s death.

Whether you are 25 or 55, a life insurance policy gives you the peace of mind that should the worst happen, your loved ones will be taken care of.

Even if you already have life insurance through your employer, you may be underinsured. Call Schechner Lifson Corporation today—we can work with you to ensure that there aren’t any gaps in your current coverage.

SECURE Act (Setting up Every Community for Retirement Enhancement

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SECURE Act (Setting up Every Community for Retirement Enhancement) signed into law December 20, 2019 is the biggest piece of retirement plan legislation since the Pension Protection Act of 2006. The Act is designed to:

Encourage employees to save more for retirement by

• Repeal of age limitations for IRA contributions
• Moved the required beginning date for Defined Contribution Plan (includes 401(k) Plans, Profit Sharing Plans and IRAs) from 70 ½ to Age 72
• Make retirement savings available to more people by expanding 401(k) employee coverage to part-time employees working 500 hours annually for the past 3 years
• Requires lifetime income disclosures in addition to simply showing your account balance
• Makes it easier for your employer to offer lifetime income options

Encourage more businesses to offer a retirement plan to their employees

• Tax credit for retirement plan start-up costs
• Makes retirement plans affordable for small businesses

The Act also eliminates “Stretch” IRAs with certain exceptions which include a surviving spouse and disabled/chronically ill beneficiary. We do have some ideas for stretching the IRA wealth into the third generation. Contact Michael Schechner (michaels@slcinsure.com) for more information.

Risky Home Renovation Trends

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How Home Renovation Trends Could Affect Your Insurance

Home renovation television shows and publications have made it so that homeowners everywhere feel prepared and eager to upgrade their own homes. Any construction activity warrants serious consideration and analysis by experts. However, there are several emerging trends in the home renovation space that have developed commonly risky characteristics.

When you engage in home renovations, you need to keep safety in mind not just during the construction phase but also in considering what the safety implications are for your newly renovated home. So, while putting your desired changes on your Pinterest board, keep the following considerations in mind:

Fire Safety with Construction and Decorating Materials

One of the hot trends in home renovations is steering into the rustic look, which often comes via natural materials. Whether it’s furniture made from reclaimed wood, storage made out of whicker, or small pieces that utilize any combination of bark, hay, grass, or other natural materials – these pieces are likely dry and potentially flammable. So, as you fill your living room with such materials, keep in mind questions like:

  • Can this piece be finished with a varnish or coating to reducing the fire risk?
  • Is this too close to the fireplace?
  • Is there a risk of spark from any nearby electronics that could turn this into kindle?

Keep electronics safety at the top of your mind

As with fashion, interior decorating trends come back around. A common trend these days is people embracing old-style lighting or retro appliances. Ignoring that these devices are likely less effective and will consume more energy compared with modern versions, many homeowners enjoy the charm of bringing these old devices back to life. That’s all well and good, but with anything that has electrical parts to it, be sure to have it checked out by a certified electrician before plugging it into your outlets and using them habitually. Old devices may have weak or exposed wires, be prone to short-circuiting, or other dangers that could shock a family member, pet, or even start a fire.

Risks associated with trying to save money via an unlicensed contractor

Home renovations are expensive, and there’s no way around that. But if you’re going to try to find an area to save on the budget, do not forgo hiring a licensed, professional contractor. It’s recommended that you hire a professional because they will have appropriate workers’ compensation and commercial general liability insurance. You have to consider who is liable if a worker were to get injured or hurt in your home. Hiring an unlicensed contractor increases the potential that the worker’s equipment is not properly secured, up-to-date, or safe. What if the workmanship is faulty? You want to ensure that you’re bringing someone into your home who’s protected and certified.

If you’re unsure of the dos and don’ts when it comes to protecting your home – contact the experts at Schechner Lifson today!

Life Events that Affect Your Insurance Needs

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Life Events that Affect Your Insurance Needs

 

As we age and reach different milestones in our lives, our insurance needs change. In order to
ensure adequate coverage, contact your insurance broker if you’re affected by any of the following
life events:

New home ownership— Purchasing a new home is a big investment—one that you will want to
protect. After purchasing a home, ensure that you have homeowners insurance to protect against
things like fire, weather damage, theft, vandalism and accidental damage. This advice also holds
true if you are buying a new condo or vacation home.

Home renovations—Once you own a home, you may want to make updates to create a better living
space. Be sure to report major home improvements to your insurance company to protect any increased
value to your home.

New children—Having or adopting children is not only a huge life change, but it’s also a
major financial commitment. As such, it’s important to purchase the right policy to secure your
child’s future. Add your child as a beneficiary on any life insurance policies, and make sure your
coverage is sufficient.

Teenage drivers— Teen drivers often carry the highest risk of auto accidents. While you want
your teen driver to remain safe on the road, costly accidents can happen without warning. Consider
adding your teen driver to your auto policy, as it is generally cheaper than purchasing a separate
policy.

Retirement—When you retire, you may change residences. If you have more than one home, this
is a good time to let your insurance provider know where you plan to spend your time.

Valuable purchases—A standard homeowners policy has limited coverage for highly valuable
items. Supplement purchases and gifts that exceed the policy’s limits with a floater—a separate
policy that provides additional insurance.

Marriage—When your marital status changes, so do your insurance needs. Marriage typically
leads to the combination of households, vehicles and other property, so it is critical to update
your insurance policies accordingly. What’s more, life insurance is vital to married couples as it
can ease the financial burden in the event of an untimely death of a partner. Ask about discounts
on car insurance for married policyholders.

Purchasing or selling a business—If you’re an entrepreneur, there will likely come a time
when you will either buy or sell your business. During these times of major change, the proper
coverage is crucial.

Insurance is critical for nearly every stage of life. Seeking coverage should be an active process,
and individuals shouldn’t assume their insurance needs remain steady over time. Consider contacting
your broker today to better understand your insurance and
future needs.

HSA Employee Benefits Solutions For Business Owners

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What You Need To Know About HSAs As A Business Owner

Health Savings Accounts (HSAs) are an increasingly common way for employers to offer healthcare to their employees that come with a unique set of benefits. However, HSAs might not be the optimal choice for every situation and every employee, so business owners must have a full understanding of what HSAs are and when they should be used.

Protecting the health of your employees will help you retain the best talent, to make sure a lack of coverage does not lead to extended absences and is, overall, the right thing to do. So, let’s dive into what exactly you need to know about HSAs.

What are HSAs, and who should use them?

In short, a Health Savings Account (HSA) is a tax-advantaged health care account that can be offered in conjunction with specific health plan offerings. To save for medical costs, employees who participate in an HSA are given the option to set aside a portion of their paycheck on a pre-tax basis.

An employee can choose how much of their paycheck goes towards healthcare expenses if they have a dependent with high medical costs, the potential for surgery in the future, or they want to be sure that an unexpected medical bill does not throw off their budget.

On a long-term basis, HSAs also help plan for retirement. By contributing into an HSA, employees are able to plan ahead and save in a tax-advantaged way for any medical care expenses that may come after retirement age.

How do HSAs benefit the business owners?

HSAs aren’t just great for the employees, but they are also advantageous for the businesses offering them. For one, a good deal of tax savings is available via federal income tax deduction and reduced payroll taxes. Additionally, because most businesses pay for at least part of their employees’ healthcare plans, the fact that HSAs have less expensive premiums mean the employer saves there as well.

That said, many business owners fail to realize that HSAs aren’t there to replace offerings of a healthcare plan to employees, but rather supplement high-deductible health plans. Employers need to look at their employees, the type of current offerings they have, and the wants and needs of their customers before deciding if HSA offerings make the most sense for them.

To find out more information and determine if offering HSAs to your employees is right for your business, get in touch with Schechner Lifson today to discuss your options.

How To Relay Your Employee Benefits Policy

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Ways to Introduce Employee Benefits To Your Team

When looking at potential jobs or deciding whether it’s worth it to stay at a current position, employees will prioritize their employee benefits more than most other aspects, potentially even salary! Employee benefits, when done well, help workers ensure the health of their family, plan for the future via retirement, and also give families a means of protection should they get hurt or disabled.

Because these are some of the most delicate and important considerations in any employee’s life, effectively and efficiently communicating the details and any chances about these employee benefits need to be a top priority for employers. Employees don’t want to be caught off guard because they were unaware of any changes, and you want them to be readily available.

Here are a handful of tips and best practices to keep in mind when it comes to relaying your employee benefits policy:

Document all employee benefit policies in written form for all to see

An employee benefits plan won’t help your employees if they’re unaware of what they are and if it’s unclear how it works. Make sure all company policies regarding employee benefits are written out and made available.

Keep Employee Benefit Documents in a central location

Often, employees will be handed a hard copy or emailed a version of these documents when they first join the company, but keeping track of those pieces of information can be a lot to ask over the years. Make sure to have a central digital repository for relevant employee benefits documents, so no matter where an employee is or when they need the information, they know right away where they can go to find the latest version of those documents.

Designate a central person or department to answer questions

Even with a central location, employees are going to have questions and concerns naturally. There must be a designated person or department where they can go. Whether that’s a single human resources (HR) manager, a whole HR team, or just the boss in a small business, making sure the employees know someone is always available for urgent questions and needs that come up will go a long way towards making your employee benefits policy effective.

When updates occur, make sure to communicate, allow for questions, and solicit feedback

Changes to an employee benefits policy could have a huge impact on employees as they’ve already made plans with an existing policy. Any changes that you bring to employee benefits must be communicated early, effectively, and often so that no employees are caught off guard. Be sure to communicate this in different formats to ensure the message reaches every employee: send an email, hold a conference call, check-in personally, etc. Employees will have questions and concerns about these changes, so you need to be ready for them.

Keep regular touchpoints

Make sure employees know that there will be regular communications about the employee benefits as they come up. It might be that every year, you hold a meeting to discuss the employee benefits, even if nothing significant changed that year—because even the lack of change is a piece of information your employees will want to have.

 

Employee benefits are critical to the daily lives of your employees. If you have any questions regarding employee benefits for your organization, contact Schechner Lifson today!

Is Minimum Coverage Enough?

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Why Minimum Coverage For Auto Insurance Is Risky

Millions of drivers every year get new insurance coverage for their cars, and when they do, they are presented with a variety of choices in terms of the level of coverage and any types of extras they may need. Naturally, many drivers will gravitate towards the minimum coverage that they are legally allowed to drive with, thinking that the need for better coverage is slim, and they’d rather save money.

While saving money is an understandable goal, this minimum coverage approach increases your chances of trouble down the road. It may even wind up being more costly to take this corner-cutting approach. So, what exactly are the risks of only purchasing minimum coverage?

You’ll be uncovered for other uninsured drivers

While you’re doing the responsible thing by purchasing car insurance, even if it’s only the bare minimum, not every driver on the road is making that decision. As a result, if you get into an accident with one of these uninsured drivers, even if it’s not your fault, you won’t be covered. One of the first upgrades beyond minimum coverage is uninsured driver coverage, which will ensure that you’re still covered even if the other driver does not have coverage.

You’ll be out of luck for damages on your car

The minimum coverage you purchase is only the legal protection to make sure that if you are at fault and damage property or another car that your policy will pay for those damages. However, by purchasing the minimum coverage, you haven’t done anything to ensure that damages to your car will be covered in the case of an incident. When you purchase the minimum coverage, any damage to your car will be coming out of your pocket.

You’ll be liable for medical expenses if an accident is your fault

In the worst-case scenario, where an accident is your fault, and the other driver must receive medical care, you are opening yourself to liability and their medical expenses. A policy that goes above minimum coverage can take care of this for you.

You’ll be left stranded without those much-needed extras

Lastly, as minimum coverage gives you no more than it has to, some of the premium add-ons you can attach to your car insurance policy are incredibly useful and could ensure you don’t get left stranded. Roadside assistance, rental car coverage, mechanical breakdowns, and more are the type of additional add-ons you can get that can save you more from costs and inconveniences down the road.

Want to find out more?

Schechner Lifson Corporation can provide assist you with your car insurance policy. With experienced and caring agents, Schechner Lifson Corporation can make sure you’re on the right path!

Can’t Decide Between A New Or Used Car?

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Considerations When Buying A New Or Used Car

Because the average car is purchased somewhere in the range of seven to ten years in the United States, making the right decision about which one you buy is of the utmost importance. One of the first decisions you’ll likely make when you’re in the market for a car is whether you want to go with a new or used car. Whichever direction you pick, there are a lot of factors to consider.

Let’s walk through some of them with you!

Car Insurance Cost

You can’t drive a car off the lot without insuring it, whether that’s new or used, but the amount you’ll pay for car insurance coverage will vary based on whether it’s a new or used car. The amount you’ll pay in car insurance, though, is directly tied to the car’s worth. And because a new car costs more than a used car, your insurance coverage costs on your new car will be more.

Depreciation

One of the most frustrating parts of owning a new car can be how much of its value is eliminated the moment you drive it off the lot. Depreciation typically reaches 20% the moment this happens. However, the more you drive the car, the more it’ll continue to depreciate, which will be felt if you end up trying to sell or trade-in the car. Of course, the used car will depreciate over time and miles will climb as well, but because you didn’t pay the ‘off the lot’ price, it won’t be as large a percentage of your initial purchase price.

Features

While the costs may weigh in favor of buying a used car, new cars are more likely to have new and exciting features that you want to take advantage of. And these features aren’t just novelties or ‘nice to have’ aspects, like stereo or digital gadgets but include safety features that can keep you and your family more protected. It can be hard to put a price on feeling and being more secure in your car, so if that weighs heavy on you, it may be important to buy a new car to get the safest experience possible.

Financing Options

While the cost of the new car may be higher, getting a new car instead of a used car will typically come with more financing options and incentives. Cash rebates, new car loans with great interest rates, and more come into play on the new car lot that are simply not there for used cars.

You have a lot of decisions to make when you’re purchasing a new car, and there’s no right or wrong answer when opting for a new or used car. It comes down to what your preferences are and what you can afford. If you want to find out more and talk through your options, Schechner Lifson can offer you the right guidance. Get in touch with us today to find out more!

What is Experience Rating for Workers Compensation?

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Experience Rating is a method to tailor the characteristics of a specific employer when determining costs associated with their workers compensation insurance premiums.

The National Council on Compensation Insurance, (NCCI), is the experienced provider of workers compensation insurance information, gathering data and preparing industry trends to help prepare objective insurance rates and loss cost recommendations.  The Plan helps develop loss experience where it can predict whether loss to a specific employer will be better or worse that average risks with the same industry classification.  The main objective of the Plan is to provide an in incentive for employers to reduce their frequency of claims and to encourage the injured employee to return to work within a reasonable time frame.

The Plan modifies the employer’s workers’ compensation premium by a factor developed from the employer’s past loss experience in an effort to project future losses.

The factor can be both a debit or a credit modification to the employer.  This rating gives employers an incentive to implement loss control measures to help eliminate or reduce injured employees, and develop return-to-work programs to reduce their costs and additional exposures to loss.

Risks in the same industry utilizing the same classification will experience a reduction in workers compensation premium for better than average claims experience.  Those employers in the same group experiencing debit modifications for worse than average loss have an opportunity to work towards improving their risk management programs to help control these costs in the future.

There are premium eligibility requirements developed by each State.  Depending upon these requirements will determine if the employer will be eligible for the experience modification rating factors.  The other factors to be considered are the employer’s past payroll and individual loss experience.  Keep in mind a risk that has one large loss in a three-year period may yield a better modification than an employer that has five or ten much smaller claims.  Claims frequency will usually generate a higher modification over the employer that has suffered only one large loss in that same experience period.

While the qualification factors will vary by state, usually the employer must meet the state’s established premium by one or two methods.  One is to have enough premiums in the most recent 24 months, or to achieve the state’s established premium threshold on average over the entire experience period.

Insurance is the spread of risk and costs associated with the loss from specific groups will most likely incur similar losses.  Perhaps the costs associated with a group can have some predictability of injuries, while it is not possible to determine which employer in this group will actually incur these costs.

Identify your potential exposures to loss, implement a good risk management program for your employees, and continuously monitor the performance and programs you have developed to control loss.  While loss cannot always be avoided, reducing the costs associated with the loss and reducing the number of losses within an employer organization will benefit the employer in the application of the experience modification.

If you would like further information or would like to discuss this important topic, please feel
free to contact Roseanne Gedman at 908-598-7853 or 
Roseanneg@slcinsure.com

Stay Up To Date With These Life Insurance Facts

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Are You Well-Versed On These Life Insurance Facts?

Life insurance is misunderstood by many people, whether that’s because it’s a complicated topic or because it’s neither easy nor fun to think about. However, it’s crucial to you and your family that you have the right type of life insurance policies to fit your needs.

To help you along the way, we recommend that you make sure you’re up to date on these five critical life insurance facts:

Choosing the right plan isn’t a one-time activity

It’s tempting to choose a life insurance plan one time and then assume that you’re done with it, but the truth is that you and your family’s needs may evolve over time. Whether it’s because of a change in financial situation, a growing family, a change in marital status, or the death of a family member, there are many reasons you should be sure to continuously review your life insurance needs.

Not all life insurance plans are the same

No life insurance plans are one-size-fits-all, and your needs and financial situation will dictate the important decision you’ll make on which policy is right for you. Choosing between term and whole life insurance is one such critical fork in the road, as term life insurance provides coverage for a set period of time (typically your main working years) whereas whole life insurance lasts your whole life. Knowing which is the right move for you is imperative, so don’t assume the first plan you see is the only type of plan available.

Life insurance doesn’t cost an arm and a leg

Far too many people fail to get proper life insurance, and one of the primary reasons for this is the misconception that it is too expensive for their budget. However, life insurance is typically affordable for most families, especially when you contact a professional in the industry to walk you through your options.

It pays off not to wait

Young and healthy people might too often opt to delay purchasing life insurance policies, thinking that with less financial obligations and lower budgets that they can afford to wait until they’re older. The truth is that if you lock in a life insurance policy when you are young and healthy will typically require a lower monthly payment than if you wait until later. Life insurance policy costs only rise over your lifetime.

If you want to get in touch with experts and discuss your life insurance needs, contact Schechner Lifson Corporation today to see how we help.

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