6 Things That Spike Your Auto Insurance

You may already know the importance of shopping around to score the best rate on your auto insurance premiums, but did you know that certain factors (or the absence of them) could cause your insurance premiums to rise?

To understand what makes your insurance premiums spike, it helps to understand the basic nature of auto insurance: Insurers make money when they insure drivers who don't have accidents, and don't make claims. They lose money when the opposite happens. As such, it is in the insurer's best interest to predict driver risk factors as accurately as possible. When any of the following factors are present in your life, they indicate an increased likelihood that you, as a potential auto insurance policyholder, may have an insurance claim that will cost the insurer money. To compensate for the increased likelihood of a payout, insurers charge you more money in the form of a raised premium. Here are six things that spike your auto insurance.

Buying a New CarBecause a new car as an asset is worth more money than an older model, it will cost more to replace. Additionally, if you finance or lease your new car purchase, most lenders require you to carry full coverage at a stated level, which makes it impossible to skimp or strategize only on the coverage you need. You can be wise about how your new ride will impact insurance premiums before you buy. According to a recent study by Insure.com, the cheapest new cars to insure tend to be larger, sturdy models such as minivans, SUVs and trucks. Don't assume that premium boosts come only with a flashy sports car or other high-priced model. The study indicated that the Honda Civic, for example, commands higher insurance rates simply because it tends to be driven by younger, childless owners who are inherently deemed riskier than parents. Further, it's one of the most stolen vehicle models in the United States.

Increasing Your CommuteLong commutes to work don't just cost you in time and fuel; they'll also boost your auto insurance premiums. Again, the risk is much greater that you'll get into an accident when you're driving during rush hour. Further, if you are in a profession that involves frequent driving, like a pizza delivery person or salesperson, you'll pay for the increased time that you spend in the car because more time spent driving increases the risk of an accident.

MovingThough actual risk is determined by the zip code you live in, city residents statistically have more accidents, which drives their premiums higher than those who live in rural areas. Additionally, more people living in an area means more claims, which is reflected in the higher premium prices in such places. If you've recently taken up residence in New Mexico, Alabama, Oklahoma or Florida, expect to pay higher premiums. According to the Insurance Research Council, these states have the greatest concentrations of uninsured motorists, which ultimately seeps into insured drivers' premiums.

Marital Status and AgeIf you're unmarried and without children, you're considered part of a higher-risk category than married couples with kids. If you're 26 or younger, and male, you'll pay even more.

Dumping Your Auto InsuranceIf you ditched your auto insurance in an effort to save some money, you've committed a classic case of being "penny smart and pound-foolish." Not having any auto insurance, even for just over 30 days, will cause your premiums to jump.

Having a Brush with the LawHaving no accidents or tickets will lower your auto insurance premiums and, as you might imagine, having either or both could raise them. When and if you'll see the spike is largely determined by your locale and your insurance provider. Insurance companies use a "merit plan" system. Most insurance companies periodically scan for recent traffic violations, whether you are a new or existing customer. After you commit a traffic violation and your insurer learns of it, your auto insurance rates could be higher for the next few years.

The Bottom LineAuto insurance rates are often based on factors out of your immediate control, including age, occupation and accidents. Understanding what factors cause your auto insurance rates to spike can help you to shop around for a more competitive provider before you receive a surprise rate increase. It may also cause you to rethink some of your current driving habits.

5 Most Expensive Cities In The U.S. For Car Insurance

Maintaining a car can be a very expensive venture if you are not careful. From annual inspection and periodic upkeep to keeping the car fueled and insured, owning a car can easily deplete your bank account and leave you strapped for cash. One major cost associated with owning a car is paying for car insurance. Depending on where you live in the United States, car insurance could either be a small expense or take a dramatic toll on your budget. Here is a look at five of the most expensive cities in America for car insurance.

DetroitAccording to an article released by Yahoo! in January 2012, Detroit, Mich. has the highest car insurance premiums on average in the U.S. The Motor City's insurance rates are most unfriendly to cash-strapped car owners. According to Runzheimer International, the average car insurance premium in Detroit was $5,941 in 2011. That's nearly $2,000 more than the runner-up. The Motor City is filled to the brim with automobiles, and as a result of the high population of citizens and cars, along with a no-fault insurance system, its insurance premiums have stayed among the highest in the country.

PhiladelphiaPhiladelphia, Pa. is another city that is hit hard by high car insurance costs. Coming in just behind Detroit, the City of Brotherly Love is not feeling the love in regards to its high premium costs. In 2011, the average car insurance policy cost drivers $4,076, according to Runzheimer International. The cost is not nearly as high as Detroit's astronomical average premium of $5,941, but is considerably higher than the approximate $1,199 national average that HomeInsurance.com reported for December 2011. Due to Philadelphia's overcrowded streets and high population of vehicles, insurance rates have continued to climb.

New OrleansAnother American city that definitely gets the short end of the stick when it comes to saving on auto insurance is New Orleans, La. The Big Easy has one of the most expensive car insurance premiums in the U.S. According to a Runzheimer International study performed in 2011, New Orleans had an average car insurance premium rate of $3,599 in 2011. New Orleans' high premiums are not due to overcrowding but because of judicial ruling. In Louisiana, only claims totaling over $50,000 actually make it to a jury case. Claims less than that benchmark are settled out of court.
MiamiMiami, Fla. is another U.S. city that was unable to escape high auto insurance premium rates. The Runzheimer International study performed in 2011 marked the average car insurance premium in Miami at a hefty $3,388. Due to the city's no-fault auto insurance rule and an influx of fraudulent claims, Miami has experienced a significant premium hike in recent years.

Newark, N.J.Last but certainly not least, Newark, N.J. has one of the highest car insurance premium averages in the U.S. The city features an average auto insurance premium of $2,867. Newark's residents certainly have quite a hefty expense in order to keep their vehicles insured. Similar to Miami and Detroit, New Jersey has a no-fault insurance rule, and costs have risen as a result.

The Bottom LineCar insurance premiums vary substantially depending upon where you live. States with no-fault laws and higher populations are prone to have higher average auto insurance premiums due to the higher amount of accidents and collisions that occur. The numbers presented are based off studies, and it is possible to find less expensive auto insurance. Many factors apply when determining what your auto insurance rate is, including driver safety, your zip code and your age. Shop carefully when buying car insurance, and make sure you are getting the best rate possible.

8 Qualities That Make A Good Insurance Agent

If you have ever contemplated becoming an insurance agent or wondered whether this career path could be right for you, then there are several qualities that you will need to possess, at least to some degree. All good insurance agents share some of the following core qualities in one way or another.

People Skills
1. Puts the needs of the client first - An agent who is only out to earn a commission, regardless of the needs of the client, is not likely to last long in the business. Agents and brokers who listen carefully to what their clients and prospects say will be able to earn their trust, which is the hardest part of their job. Those who are willing to put their clients into a product that pays a lower commission because it better fits their needs are much more likely to be successful.

2. Good customer service - Customers who are able to get a hold of their agents when they need them are much more likely to stay happy and reassured. A timely response to inquiries and phone calls is a must, and you must be able to do what you say you will do, when you say you will do it - or at least have a good reason as to why you can't. One of the major complaints of those who buy life insurance policies is that there is no one around to answer their questions after they have purchased the policy.

3. Emotional intelligence - This includes the ability to listen and empathize with clients on a deeper level in order to discern what they really want and need. A good agent is tactful and knows how to help a client see financial reality clearly, even when the client is dead set against it.

Strong Personality
1. High energy level - One of the most important traits of a good insurance agent is that they appear to be excited and eager at all times. A worn-down or dreary disposition will immediately rub off on clients and discourage them from buying anything.

2. Persistence - This is perhaps the most vital quality of any good insurance agent. Those who work in this field absolutely must be able to handle rejection on a daily basis over the course of their careers, and do it with a smile. Good insurance agents understand that each "no" only brings them closer to someone who will say "yes."

3. Honesty - Insurance agents who use deception to close business seldom stay with the same company for very long - and can end up behind bars in some cases. A good agent knows that telling the truth up front will win them clients' respect and trust and is likely to lead to repeat business over time.

General Knowledge
1. Wide array of products - As the old saying goes, if all you have to work with is a hammer, then everything in the world looks like a nail. A good insurance agent will be able to offer a comprehensive selection of products and services that can meet any reasonable need a client might have.

2. Technical knowledge - A good insurance agent knows much more than how to sell a policy. The agent must understand the tax and legal aspects of the products he or she sells and how they are designed to fit into a client's overall financial situation. Many agents earn financial planning designations such as the Certified Financial Planner®, Chartered Financial Counselor or other credential. Some agents practice financial planning, income tax preparation or some other avenue of financial service as their primary profession and then write insurance business when it becomes necessary.

The Bottom Line
These are just some of the qualities that life insurance agents must possess in order to be successful. The life insurance business can be very challenging and immensely rewarding for those who are willing to learn the necessary skills to build their business. For more information on how to become a successful insurance agent, contact the recruiting offices of a few different agencies or a headhunter who works with insurance agents.

Avoid The Obamacare No-Insurance Penalty By Feb 15

ATTENTION! If you’re one of the 7.3 million Americans who have insurance through the Affordable Care Act – or one of the 13.4 % who do not but probably should – there’s a deadline looming that you cannot miss. If you miss it, you’re likely to have some stiff penalties when you file your taxes this year and next.
Here’s how it works. Under the Affordable Care Act, popularly known as Obamacare, most people are required to have healthcare insurance. As long as you have insurance through your employer, insurance you purchased on your own, Medicare, Medicaid, a Veterans plan or some other qualifying coverage, you have nothing to worry about. You can check to see if your plan qualifies by clicking here.
If you don’t have qualifying coverage, don’t panic: You aren’t going to jail, but you will pay a penalty when you file your income taxes and that penalty can be large. If you didn’t have coverage in 2014, you will pay 1% of your household income or $95 per person ($47.50 per child under 18) – whichever is higher. In 2014, the median household income was reported at $53.891. An uninsured couple filing jointly as married with one child would pay around $336 when they complete their 2014 taxes.
In 2015, the penalty is much higher. Plan to pay 2% of your yearly household income or $325 per person ($162.50 per child under 18) – whichever is higher. That same family of three might pay around $812 when they complete their 2015 taxes next year, assuming they didn’t get coverage at any time during 2015. You can read more about the penalties here.
Of course there are a plethora of tax situations that can affect these amounts. You and your tax preparer will figure it out together. Others might be exempt from the penalty fees. See if you’re exempt here.
Open Enrollment is NOW
If you received coverage through an employer in the past, you know that there are certain periods when you can change your current policy or enroll for new coverage. You can’t do it whenever you would like unless certain life events happen. If you miss the open enrollment window, you’re out of luck until the next period comes or a qualifying event happens.

Obamacare is the same way. Open enrollment to buy insurance through the Health Insurance Marketplace/Exchange runs from November 15, 2014 to February 15, 2015. If you don’t have coverage by February 15, you won’t be able to get coverage through the Health Insurance Marketplace until the next open enrollment period. Translation: Miss the February 15th deadline and you could be nailed on next year's taxes even before this year's tax deadline has passed. (See Open Enrollment For Health Insurance Marketplace.)
There are a few ways to obtain coverage after the deadline passes. If you get married, add a child to your family, start a new job, or lose your current coverage for a qualifying reason you can sign up for Affordable Care Act coverage outside of the enrollment period. If you qualify for Medicaid, you can enroll at any time. Another way to avoid the penalty: Purchase coverage on your own through a private insurer – you won't be eligible for subsidies you might have qualified for through the Health Insurance Exchange/Marketplace, but you will be covered. You can learn more about these options by clicking here.
If you qualify for an hardship exemption, you may not owe a penalty for 2014. Find out if you qualify by clicking here.
Saved By Auto-Renew?
If you were already enrolled in a plan through the marketplace in 2014, there’s a good chance that it was automatically renewed on January 1. You probably received a letter telling you how to renew your coverage. Even if you didn’t do anything, your plan was probably renewed with all of the same terms, but don’t assume anything. Many state healthcare exchanges don’t have an auto-renew feature.
If you live in a state that doesn’t use the federal exchange (healthcare.gov), verify your coverage. And if you do, verify it anyway. Non federal-exchange states include California, Connecticut, Hawaii, Idaho, Kentucky, New York and Nevada. Click here, then scroll down for a map with the full list of states. If you want more information about auto-renew, click here.
Auto-renew assumes that all of the information you provided during your original enrollment is still true. You could face a penalty if anything changed and you didn’t report it.
The Bottom Line
Some 90% of people who apply for coverage through healthcare.gov receive some sort of financial assistance. With odds like that, there’s a really good chance that you won’t pay full price.
There are plenty of resources to help you get coverage at the lowest cost. Visit healthcare.gov and read about how to obtain coverage. Or click here to find somebody near you that can help. For more on the Affordable Care Act, see Tips On The Health Insurance Marketplace/Exchange.

What Age For Medicare Eligibility?

When you think of Medicare, you probably assume that it’s for people of retirement age. That’s true, but the program covers more than just those who have worked all their life. You might be eligible right now and not know it.
In 2013 (the most recent numbers available) Medicare covered more than 52 million people in the United States. The bulk of beneficiaries, more than 42 million, were people aged 65 or older. The remaining nearly 10 million received services as a result of a disability.
Like Social Security, Medicare is a U.S. government program funded by tax withholding from most workers' paychecks. When they reach 65 or meet other eligibility requirements, they receive Medicare services. You will probably receive Medicare Part A coverage free of charge because of your payroll deductions, but Medicare has other requirements that will likely cost you. See Medicare 101: Do You Need All 4 Parts?
Who’s Eligible at 65?
Retirees and those still working. To receive full Medicare coverage at 65, you (or your spouse) have to have earned enough credits to be eligible for Social Security. In 2014, each $1,200 you earn equals one credit, but you can only earn a maximum of four each year. Starting in 2015, getting a point will require earning $1,220.
You will receive full benefits at retirement if you have earned 40 credits –10 years of work if you earned at least $4,800 in each of those years (at 2014 rates).
If you paid into a retirement system that didn’t withhold Social Security or Medicare premiums, you’re probably still eligible for Medicare – either through your retirement system or through your spouse.
If you continue to work beyond age 65, things get more complicated. You will have to file for Medicare, but you may be able to keep your company’s health insurance policy as your primary insurer. Or, your company-sponsored insurance plan might force you to make Medicare primary, or other conditions may apply to you (see The Employee's Guide To Medicare). There’s a lot to consider that makes it prudent to talk to a Medicare expert about your choices.
Spouses. Maybe you were a stay-at-home parent or spouse. You can still receive Medicare benefits at age 65 based on your spouse's work record. If your spouse has the required 40 credits and you’ve been married for at least one year, you qualify for benefits.
People in same-sex marriages may qualify for spousal benefits if they live in the state where they were married or in another state that recognizes same-sex marriages – or are civilian or military employees of the federal government. For same-sex couples outside of these categories, the guidelines are vague but couples should apply anyway.

If you’re divorced and don't qualify for Medicare under your own work record, you may qualify based on your ex-spouse's record as long as your marriage lasted at least 10 years and you're currently single.
Disability Benefits: You Can Be Younger
You may be eligible for full benefits before the age of 65 if you have a qualifying disability. There is no published list of qualified disabilities. Caseworkers evaluate each case individually.
How to Qualify. In order to receive Medicare disability benefits, you must first receive Social Security Disability Insurance (SSDI) benefits for 24 months. There is usually a five-month waiting period after a worker or widow is labeled as disabled before he or she can receive Social Security Disability benefits. During this waiting period, the person may be eligible for coverage under an employer’s health plan or COBRA if they’re no longer employed.
People who qualify as disabled fall under the same rules as a recipient who receives retiree benefits. There is no difference in coverage.
If a person has end stage renal disease (ESRD) or amyotropic lateral sclerosis (ALS, also known as Lou Gehrig’s disease) there is no 24-month waiting period for benefits. A person diagnosed with ESRD can generally begin receiving benefits three months after a course of regular dialysis or after a kidney transplant. As soon as a person diagnosed with ALS begins collecting Social Security Disability benefits, he or she is enrolled in Part A and Part B Medicare benefits.
What if you work? You can work and receive Medicare disability benefits for a transition period under Social Security's work incentives and Ticket to Work programs.
There are three time frames to understand. The first, the trial work period, is a nine-month period during which you can test your ability to work and still receive full benefits. The nine months don’t have to be consecutive. Any month in which you earn at least $770 (after expenses) or work more than 80 hours if you're self-employed counts as a month. The trial period continues until you have worked for nine months within a 60-month period.
Once those nine months are used up, you move into the next time frame – the extended period of eligibility. For the next 36 months, you can still receive benefits in any month you aren’t earning “substantial” benefits – generally considered anything over $1,070 per month or $1,800 if you are blind.
Finally, you can still receive free Medicare Part A benefits and pay the premium for Part B for at least 93 months after the nine-month trial period if you still qualify as disabled. If you want to continue receiving Part B benefits, you have to request it in writing.
If you’re disabled, you may incur extra expenses that those without disabilities do not. Expenses such as paid transportation to work, mental health counseling, prescription drugs and other qualified expenses might be deducted from your monthly income before the determination of benefits, which may allow you to earn more and still qualify for benefits.
The Bottom Line
To see if you qualify for benefits, go to Medicare.gov’s eligibility and premium calculator. Here, you can check your eligibility for benefits and get an estimate of your monthly premium.
Your individual situation may not be covered in the calculator. Contact Social Security to discuss your case and get the assistance you need. Experts there will help you understand your particular situation and guide you through the next steps.

Assurant Vs Delta Dental Insurance

Dental insurance seems to be coming into its own. The number of people insured got a boost from the Affordable Care Act that defined dental coverage as an “essential benefit” for children, and offered adults the benefit either as part of a health plan or as a separate dental plan. As people are given the chance to make consumer decisions about the coverage they want, some are choosing less expensive medical plans “so that they can use some of their dollars to buy other benefits, such as vision and dental plans,” said Aaron Groffman, president of the independent Ignition Group, which analyzes data and identifies dental industry trends.
Dentists are also warming up to joining insurer networks. Of the approximately 200,000 active dentists in the U.S.,less than 50,000 were part of the top 15 preferred provider networks in March 2009. But by March 2013, that number rose to more than 70,000, according to Groffman’s data. (For an overview of how dental insurance works, see Should You Bite On Dental Insurance?)
About 53 million full-time workers get dental insurance through their employers. Here we zero in on two plans offered to federal government employers and to those who work for state governments, including Arizona, Oklahoma and Tennessee, among other employers. We take a close look at the Assurant Prepaid and Delta PDO offered by the state of Tennessee. But while the details of other plans may vary, these tips for comparing plans apply to most choices among dental benefits. (You may also want to read How To Choose A Health Care Plan and 4 Important Steps For Choosing Dental Insurance.)
Consider What Type of Plan is Best for You
​As in medical insurance, the choice often comes down to a dental health maintenance organization (HMO or DHMO) or a preferred dental provider organization (PPO or PDO). Assurant calls the offering we analyze here a “prepaid” plan, an alternative term for an HMO that means the dentists are prepaid on a per head (capitation) basis, receiving a basic payment for each patient they see. Assurant offers dental HMOs in 21 states through employers, and also individual HMO plans in 16 states. In this HMO there there are no forms to fill out, and Assurant provides the dollar amounts for all copays, which can ease budgeting.
Delta sells a variety of PPO or PDO options, a network of dentists under contract to the insurance company to deliver specified services for set fees. A variety of Delta plans are offered by employers and sold through groups such as AARP. PPO networks of dentists are typically larger than those of HMOs. In September, 2014 Delta had the fifth largest network of dental providers. PPOs generally have more expensive premiums, and perhaps larger copays. Delta expresses its benefits as a percentage of Maximum Allowable Charge (MAC), so it's more difficult to calculate the amounts you may be responsible for. The PDO allows you to see any dentist, in or out of network, although copays are considerably larger for out of network dentists. Comparing these two options provides no clear winner, it depends on your circumstances. Here’s how to tell.
First, Check Out Local Dentists
If you can’t find a dentist you like who takes your plan and can give you prompt appointments, dental benefits will do you no good. It’s important to check the plan’s dental directory to find participating dentists at convenient locations. And a good idea to call a few of the dentists you’re considering to find out if their hours suit your needs and the office staff is accommodating. One question to ask: How long will I have to wait for my first appointment? The average wait time for a dental appointment for a new patient has decreased from 10.9 days in 2001 to 5.7 days in 2013, according to the American Dental Association. So if a dentist's office says you have to wait weeks for an appointment, you might want to try another one.
Take Care of Basic Needs
The great boon of dental insurance is that office visits, including periodic oral evaluations, routine cleanings and x-rays are liberally covered. The idea is to encourage you to get good preventive care so your future dental costs (and the misery involved) will be reduced. This care does not come cheaply. A tooth cleaning appointment that includes dental X-rays and an exam by the dentist, costs an average of $198, according to consumer experiences reported by costhelper.com.

In the Tennessee plans, Assurant Prepaid has no annual deductible, and no charge for x-rays, routine cleaning, and periodic oral evaluations by general dentist. There is a co-pay of $10 for an office visit. Under Delta PDO, if you use an in-network dentist there is no charge for an office visit, oral evaluation and routine cleaning, but you’re responsible for 20% of the cost for X-rays. Both plans charge a copay for amalgam (silver) fillings.
Expect Only Partial Coverage for Emergency Events
Root canal (endodontics) is generally unplanned and can be expensive. Under Assurant PrePaid there is a $250 copay for a root canal by a general dentist and $600 copay for one by a specialist dentist. In the Delta PDO you’re responsible for 50% of the maximum allowable charge. Tooth extraction and removal of impacted teeth also have significant copays, especially if they are done by a specialist dentist.
Plan for Big Ticket Items
Does someone in the family need braces or dentures? Under Delta PPO, orthodontics are covered at 50% of the Maximum Allowable Charge agreed to by participating dentists. Under Assurant Prepaid, it’s 25% off the “participating orthodontics usual fee.” While Delta might seem a better a deal on first glance, consider that there’s a waiting period of 12 months before the benefit kicks in, and that the benefit applies only up to age 19. So if you’re an adult desiring orthodontics, or you need the benefit more quickly, you might be better off taking Assurant Prepaid. A complete set of upper dentures will cost $310 copay plus lab fees at Assurant Pre-Paid, and 50% of maximum allowable charge at Delta PDO
Remember the Annual Maximum Benefit
Here’s where Assurant Prepaid might offer the best deal for families with large dental needs. There is no annual maximum on the benefits paid and pre-existing conditions are covered. Delta PPO, on the other hand, has $1500 maximum per person per year, and there are some exclusions in the coverage of pre-existing conditions.
And Now to the Premiums
If you get dental insurance through your employer, premiums may be fairly low, because the employer may chip in and negotiate a good deal on costs. Here’s what employees of the state of Tennessee have to pay this year or dental insurance premiums.

Monthly Premium Comparison

Plan	Assurant Prepaid	Delta PDO
Employee only	$9.63	$20.46
Employee + Spouse	$17.07	$38.69
Employee + Spouse + Children	$23.47	$75.71

The Bottom Line
If your goal is healthy teeth, having dental benefits and finding a dentist you like are important steps. Consumers who had dental insurance and those who had a personal dentist were more likely to visit the dentist than those without, according to a recent Ohio Health issues poll. Examine dental plans carefully to make sure you understand the limits of the benefits. Set aside money for both premiums and potentially expensive copayments. If dental insurance is not an option and you need major work, talk to your dentist about arranging a payment plan.

4 Important Steps For Choosing Dental Insurance

Dental insurance will cost you much less in premiums than health insurance, but of course there’s a catch. Most health insurance policies cover a hefty percentage of even towering expenses once you’ve paid your deductible. But dental insurance policies have an annual limit to coverage, from $1000 to $1500 a year, along with a $50 to $100 deductible. While plans may pay 80% to 100% of exams, x-rays and cleanings, when it comes to crowns, root canals and gum-disease treatments by in-network dentists the benefit may be only 50% of the cost. Some procedures, such as orthodontia and cosmetic dentistry, are not covered at all.
It's not surprising that cost constraints can make even people with dental insurance delay needed procedures. Some put off care because their insurance doesn’t cover the procedure, and others because they have used up their maximum coverage for the year, according to a survey by Consumer Reports.
To avoid getting caught with unexpected expenses, here some key steps to take when buying dental insurance.
1. Find Out If You Can Get Group Coverage
The great majority of people with dental insurance have benefits through their employer or other group coverage programs such as AARP, Affordable Care Act marketplace health insurance policies or public programs such as Medicaid, Children’s Health Insurance Program and TriCare for the military.
These plans are generally less expensive than purchasing individual insurance and may also have better benefits.But take a good hard look at the details of even an employer-sponsored plan to decide whether the premiums are worth the money for someone in your situation.
2. Check Into Individual Policies
More expensive than group policies – and often with more limited benefits – individual policies (whether you're buying one just for yourself or for your family) often have waiting periods for major procedures. If you’re thinking of signing up for a plan “just in time” because you need implants or a new set of dentures, realize that insurers are well aware of that tactic and institute a waiting period of perhaps a year before you can start using certain benefits.
It's best to comparison shop. Get price quotes and policy details from insurance-company websites or talk to a knowledgeable insurance agent.
3. Examine the List of Dentists in the Network
Indemnity insurance plans allow you to use the dentist of your choice, but the common PPO and HMO plans limit you to dentists in their networks. If you have a dentist you like, ask which insurance and discount plans he or she accepts. If you’re OK with using a new dentist, a PPO or HMO might fit your needs.

But be wary if a new dentist you visit says you need a great deal of unexpected work. A revealing account by the son of a dentist describes how some in-network dentists may recommend unnecessary procedures to make up for income lost on preventive services, for which they are reimbursed at a low rate by dental insurers. Ask health professionals, neighbors and friends if they can recommend a local dentist they’ve found to be good. Then check what insurance and discount plans those practitioners accept.
4. Know What the Policy Covers
In order to budget for dental expenses, it's important to carefully review the policies you’re considering. For example, from the time your insurance begins, AARP Delta policies cover gum cleanings, denture repairs, restorations, oral surgery and root canals. But you need to wait until your second year of coverage to get benefits for gum-disease treatment, crown and cast restorations, dental implants or dentures. Even then, the benefit is limited to 50% of costs.
If you or your child need major dental work, know that you’ll likely have to pay a hefty share of the cost. With both group and individual policies, remember benefits are limited and can vary significantly. Group plans may also have waiting periods, and almost all plans pay only a fraction of costs for major work, so check the details. Your coworkers or friends may be insured by the same company but have a different benefit package from the one you are offered.
The Bottom Line
The bright spot of dental insurance is that coverage is good for preventive care, such as check ups, cleanings and dental x-rays (though x-rays may be covered less frequently than eager dentists want to take them). Adults and children with dental benefits are more likely to go to the dentist, receive restorative care and experience greater overall health, according to a report by the National Association of Dental Plans. Purchasing insurance may well motivate you to get preventive care and avoid more expensive and uncomfortable procedures.
When purchasing individual dental insurance (rather than group insurance through your employer or another source), be aware that major procedures may not be covered in the first year, and even then the benefit is likely to be only half of what the dentist charges. You’ll need to set aside money in a health savings account or personal fund so you’re not caught short if you need major work. For more on this topic, see Do You Need Dental Coverage? and Should You Bite On Dental Insurance?

How To Buy A Health Plan With A Chronic Condition

'Tis the season for health insurance, whether you're buying a plan through your employer, through a government-run marketplace in your state or directly from a health insurance company on your own.
Thanks to the Affordable Care Act, you can no longer be denied health insurance because you have a pre-existing condition. But that doesn't mean your choice of health plan gets any easier. If anything, having a chronic condition makes a purchase decision more difficult.
According to the Partnership to Fight Chronic Disease, more than 133 million Americans -- about 45 percent of the population -- has at least one ongoing or chronic condition such as heart disease, cancer, diabetes or asthma.
Your health insurance decisions are the same whether or not you have a pre-existing condition, says Craig Rosenberg, health and wellness practice leader for Aon Hewitt, a human resources solutions firm. Everyone has to look at coverage levels, premiums, deductibles and other out-of-pocket expenses. "But your choices become even more important simply due to the fact that you're likely to use more health care than someone who is healthy," he says.

Start the decision with your doctors

A good place to start is with your health care providers. Before you sign up for a health plan, talk to your health care providers about what the coming year might look like for you, advises Glenda Terry, a registered nurse on Aon Hewitt's advocacy team. Are you likely to need surgery or costly procedures? Or is your disease well managed? You may need little more than prescription refills and periodic checkups. While it's impossible to predict exactly how healthy you'll be, having an idea of what's in store will help you crunch numbers and see what options are best.
Too many people buy health insurance based on the monthly premiums alone, Rosenberg says. Big mistake. You should never automatically choose the most expensive plan or the least expensive or even the one in the middle, he says. Look at the plan's copays, annual deductible and out-of-pocket maximum. Then make yourself a worksheet. Look at how much you may spend in the next year going to doctors and whether you're likely to be hospitalized.
"If you have a chronic condition and use a lot of health care, the plan that is the most expensive to purchase could end up being the lowest cost given how it covers your needs," Rosenberg says.
In addition, here are 5 big mistakes when buying a health plan at work.

Check the provider networks and medications

Another major consideration when you have a chronic illness: What providers and hospitals are in the plan's network? Most plans pay more when providers participate in their networks. Some plans provide some coverage for out-of-network providers and some don't.
Checking that your doctors are in network is always important but even more so if you have a chronic condition, says Pamala McIntire, a benefits advisor with Reames Employee Benefits Solutions Inc. in Daytona Beach, Florida.

Don't assume because your doctors were in your plan this year that they will be next year. Health insurers change their plan networks all the time. Plans generally list their providers on their website. You also can call your doctor's office and ask. If you call, be sure to be very specific about the plan name because some doctors may take a plan from your company (Aetna, Blue Cross Blue Shield, UnitedHealthcare, etc.) but not your particular plan from that insurer.
Even seeing your doctor on the list doesn't guarantee that he'll be there the whole year. Here's what to do when your doctor disappears from your plan's provider network.
If you have been seeing a doctor for your condition and he won't take your insurance next year, you have a big decision to make.
"You have to decide if you want to continue to see your doctor or choose another doctor who is in your plan," Rosenberg says. "You have to decide how important your relationship with your current provider is." You also have to consider whether you could afford to pay more toward your care if you go out of network.
You should also check whether your medications are covered. Most plans have "formularies," or lists of preferred drugs that they cover at a higher rate. "Someone who has a chronic health condition is more likely to take medications on a regular basis," Rosenberg says. Some plans might require that you get your medications by mail order. That requirement could play into your choice, Rosenberg says.

Consider your lifestyle and pre-certification requirements

Think about your lifestyle as well, McIntire advises. If you have a chronic condition and travel a great deal, you might want to choose an HMO. Here's why: HMOs must treat emergency room visits and resulting hospital stays, no matter where the ER is, as in-network. Preferred provider organizations (PPOs) or point of service plans (POS) don't have to. If you have a PPO or POS and end up being admitted to the hospital while out of town, you could be billed for out-of-network follow-up care by the different providers who treat you.
On the other hand, McIntire says, HMOs tend to have more restrictive formularies. So if you have a chronic condition and need a new prescription, it may not be covered. Also, HMOs often require you to get pre-certification for treatment or tests or they won't reimburse you for them. You have to weigh the pros and cons of each of your choices, she says.
Employers today often provide online tools to help you chart your possible copays and out-of-pocket costs. Take full advantage of them, Rosenberg says.
Finally, Terry says, see whether the plan offers a disease-management program for your chronic condition. The plan may offer close coordination of care to help you manage your disease better. And that could be a factor in its favor when you're making a health insurance comparison.
More from Insure.com
10 things to know about open enrollment for 2015 individual & family health plans
Using your health plan for doctors who don't take your insurance
The original article can be found at Insure.com:
How to buy a health plan when you have a chronic medical condition

Medigap Insurance: Who Needs It?

If you’re looking for an example of a large government program that’s difficult to understand, look no further than Medicare. Medicare.gov contains hundreds of pages of information – few of which are easy reading.
But one of the most confusing aspects is why, given all of Medicare's parts (see Medicare 101: Do You Need All 4 Parts?) Americans on Medicare are encouraged to buy even more health insurance: a Medicare Supplementary Medical Insurance policy, also known as Medigap. These answers will explain why.
1. What is Medigap Insurance?
Medigap is additional insurance for Medicare recipients. Insurance for your insurance, basically.
2. Why do I need more health Insurance?
Because Medicare has holes (or gaps – get it?). "Original Medicare," as the government calls it, defined as parts A, B, and D, doesn’t do a very good job of really covering you if you were to get seriously ill or injured. It pays some of your expenses, but far from all.
That’s where Medigap insurance kicks in. Depending on the plan you get, Medigap will pay all or a potion of the costs Medicare doesn’t cover.
3. Those “extra” charges can’t be that substantial, can they?
Oh, yes they can. Here are a few examples. If you are admitted to the hospital and only have Original Medicare, you have to pay the first $1,216 of expenses. If you stay more than 60 days, you have to pay a portion of each day’s cost from then on.The size of your daily payment depends on how long you have been in the hospital and goes up the longer you stay.
Doctor visits and medical procedures are going to cost you too. Your deductible is $147 but, after that, you have to pay 20% of "the Medicare-approved amount" for most doctor services. What if you have a $250,000 bill? Look for a $50,000 bill in your mailbox – even more if the Medicare-approved fee is lower than $250,000. There’s no limit on how high it goes.
Prescription drugs can also eat at your budget. Original Medicare will leave you paying as much as 72% of the cost of some of your prescription drugs if you need enough medication to push you into notorious doughnut hole, the period when Part D gives people with high medication costs no coverage until their spending exceeds $4,550.
4. How do Medigap insurance policies work?
Glad you asked! You know all those “parts” of Medicare? Part A, B, and D? Medigap policies have parts of their own.They're labeled with the letters, A–N (though E, H, I, and J are no longer offered). The last thing you need with Medicare is more letters, but these letters make the options consistent across every provider.

Because private insurance companies offer these policies, you have to do some comparison shopping. Your shopping is made easier because an “F” plan, for example, is the same no matter which insurance company offers it. You don’t have to worry about one insurance company offering something different in the “F” plan than another does.
5. Which Medigap insurance plan is right for me?
You know what we’re going to say, right? “Talk with a qualified insurance agent or Medicare advisor to find the plan that fits your individual profile.” Here's some other advice. First, read the Medicare publication, “Choosing a Medigap Policy.” On page 11 you’ll find a chart of each policy type and what it covers. If you want to be completely covered—as in 100% of everything—“F” is your choice. The other options cost less but allow more of those gaps to remain open.
6. What’s the difference between Medigap insurance and Medicare Advantage?
A Medicare Advantage plan is similar to an HMO or PPO; it incorporates your Original Medicare benefits, plus additional coverage, such as for preventive care, within a pre-selected network of doctors and hospitals.
A Medigap policy supplements your Original Medicare coverage, paying expenses Original Medicare doesn't cover. It will probably give you more freedom of choice than Medicare Advantage (as long as your physician or facility accepts Medicare) and is a better option for snowbirds and others who travel a great deal or live in more than one location. You need to be signed up for Medicare before you can get Medigap. For more on the pros and cons, see Medigap Vs. Medicare Advantage: Which Is Better?
7. Can I have both Medicare Advantage and Medigap Insurance?
No. However, an insurer can sell you a Medigap policy if you explain that you’re leaving Medicare Advantage. This allows you to start your Medigap coverage the day after your Advantage plan runs out.
8. Does a Medigap policy cover both my spouse and me?
Unfortunately, it doesn’t. A Medigap policy covers only one person.
9. Can the insurer cancel my Medigap insurance if I get sick?
No…that’s illegal. As long as you pay your premiums, your policy is renewable for the rest of your life.
The Bottom Line
Original Medicare has coverage gaps. Without some type of supplemental insurance, you could end up paying a lot of money out of pocket. Medigap insurance closes those gaps. If you want to search for a policy that is right for you, click here for Medicare's official Medigap search capability.

Strategies To Use Life Insurance For Retirement

Can the right life insurance policy help you meet your retirement savings goals? Yes, but maybe not in the way you’re thinking. While life insurance agents will try to sell you on the benefits of permanent life insurance that accumulates cash value, such policies usually only make sense for individuals with a net worth of at least $5 million, the threshold where estate taxes kick in after death.
For almost everyone else, the best way to incorporate life insurance into your retirement-planning strategy is to get the right death benefit for your family at the lowest cost so you have the most money left over to take other key steps toward financial security. Let’s take a look at how this strategy works.
Step 1: Buy Term
If you have a spouse or children who depend on your income or who depend on your “free” services as a stay-at-home parent or homemaker, life insurance should be part of your financial plan. In other words, almost everyone needs life insurance. Even if you miss out on retirement because of an early death, you’d still like your spouse to be financially secure enough to have a chance at enjoying retirement, right? The least expensive type of life insurance, not just considering your out-of-pocket expense but also considering how much coverage you get for what you pay, is term life insurance. (For related reading, see Insuring Against the Loss of a Homemaker.)
Life insurance prices vary significantly depending on your age, health and policy features, but here’s one example that shows how much extra cash you could have to work with if you buy term instead of permanent life insurance. A nonsmoking, 35-year-old New York man in good health, meaning his blood pressure and cholesterol might be a bit higher than the ideal, might be able to get a 20-year term policy with a $1 million death benefit for $1,030 per year. If the same man bought a whole life policy, a type of permanent life insurance, the premium might be $14,090 annually for the same death benefit. That’s a $13,060 difference per year.
Given these costs, term life insurance can be an ideal retirement savings tool in two ways. First, it provides the basic financial protection your family will need if you pass away before you’ve accumulated enough savings for them to live off of. Second, its low, fixed price frees up more of your disposable income to create an emergency fund, purchase long-term disability insurance and invest in low-cost funds.
How long a term you should buy depends on how long you think it will take to amass enough savings for your family to live comfortably without you. It also depends on your current age, because it can be difficult to get term insurance past age 65. How much life insurance you should carry depends on how much debt you have, how much income you need to replace and the cost of any future obligations you want to fund, such as a child’s college tuition.
If you get life insurance as a benefit through work, your employer-provided life insurance may not be enough; you may need to supplement if with a policy you buy on your own. Also, if you want the security of knowing that your insurance will be renewed each year as long as you pay the premiums and of knowing that your premiums will be the same every year for as long as the policy is in force, get a level-premium, guaranteed renewable and noncancellable term life insurance policy.
Step 2: Create an Emergency Fund
The first way you should put the savings from buying term life insurance to work is by building yourself an emergency fund of three to six months’ worth of expenses – maybe more, if you’re really risk averse or have an irregular income. Having an emergency fund prevents you from going into debt to handle times of increased expenses or reduced income.

Avoiding debt means avoiding paying interest; having to pay interest, especially at credit card rates, makes it that much harder to recover from a setback. A financial emergency often means temporarily stopping your retirement contributions; the sooner you can bounce back, the sooner you can get back on track with your retirement savings.
Step 3: Protect Your Income with Long-Term Disability Insurance
Ideally, you’d take this step at the same time as you’re building your emergency fund; there’s no reason to wait. While many people think they can get disability benefits from Social Security if a serious illness or injury prevents them from working, it is hard to qualify for these benefits and they might be far below what you’d need to maintain your household’s standard of living. What’s more, you won’t qualify for those benefits if you haven’t paid into the system; many public employees have not.
Among disability insurance policies, an own-occupation policy will cost you more than an any-occupation policy, but it will provide more comprehensive coverage. If you’re unable to work in your own profession – say, accounting – you won’t have to become a retail store greeter to get by; your disability insurance will replace a significant percentage of your lost income. Again, look for a guaranteed renewable and noncancellable policy, which ensures that your premiums won’t increase and you won’t have to worry about requalifying. You can keep the policy as long as you pay the premiums. Even if you're single and don't have children to support, having disability insurance is still important – maybe more so, as you don't have a spouse or other immediate family to help you get by should you become seriously ill.
Choosing the best disability insurance means either purchasing your own policy to protect your income and anyone who depends on it or making sure you have enough coverage through your employer. As personal finance guru Dave Ramsey likes to say, “your most powerful wealth-building tool is your income.” Without an income, you have no way to save for retirement. (Learn more in our Intro to Disability Insurance.)
Step 4: Invest the Rest
You’ve got life insurance, an emergency fund and disability insurance. Finally, let’s talk about investing the rest of the money you’ve saved by using term life insurance as a retirement tool.
While permanent life insurance policies have a cash value component that accumulates savings and can be invested, you’ll have the greatest control over your money and the potential to earn the highest returns if you invest it yourself, through the brokerage of your choosing, rather than through a life insurance policy. You won’t pay the high policy fees and agent commissions associated with permanent life insurance, your investment performance won’t be tied to the life insurance company’s financial performance, and you won’t be limited to the investments the insurance company offers.
You can set up a tax-advantaged retirement account at a brokerage that offers rock-bottom investment fees, which is one of the keys to growing your portfolio. You can create a well-diversified portfolio of uncomplicated index funds or exchange-traded funds. For even more hands-off investing, consider a target-date fund, which – depending on the fund's strategy – adjusts your portfolio mix to become more conservative as you get closer to retirement age.
The Bottom Line
Buying term life insurance and investing the difference isn’t what most people think of when considering how a life insurance policy can help meet their retirement savings goals. Yet, for most people, it’s the most effective strategy.

Tips for Finding Affordable Health Insurance

When the Affordable Care Act went into full effect this year, it gave uninsured Americans a powerful incentive to go out and obtain a health policy: a fee if they didn’t comply. And while the penalty was relatively mild in 2014, it’s only going to increase starting in 2015. As a result, many individuals who never thought they could afford health insurance are being pushed into the marketplace.
There is some good news for those on a budget, however. The ACA provides more insurance options than before. And those on the lower end of the income scale qualify for subsidies that make premiums a lot more manageable.
If you’re one of the many Americans looking for insurance on their own because they don’t get coverage through work, here’s what you need to know to keep your payments as low as possible.
See if you can get a subsidy
If you’re buying an individual health care plan, you can either do so the old-fashioned way – purchasing it directly from a carrier – or shop policies on your state’s health insurance exchange. An exchange, or “marketplace,” is comprised of private insurers who must offer standardized plans for individuals, families and small businesses.
From a cost perspective, going through this marketplace is a double-edged sword. Because the government sets minimum standards for what’s covered under these plans, their sticker price is sometimes higher than plans sold outside the exchange. However, some consumers can get income-based tax credits if they use the marketplace. For that reason alone, it’s worth checking them out when you go looking for a policy.
To obtain a subsidy as an individual, you have to be a citizen or legal resident of the U.S. and earn less than 400% of the federal poverty level. Currently, that amounts to $46,680 or less per year for an individual and below $95,400 for a family of four. Once you go on the exchange website, you’ll be asked for your income and family size to determine your eligibility.
Decide if a basic plan fits your needs
One of the easiest ways to keep your monthly expenses in check is to choose a high-deductible health plan (HDHP). You’ll have lower premium, but also a lot more risk if something unforeseen should happen – they’re called high-deductible plans for a reason.

A nice benefit of HDHPs is that you can pair them with a health savings account, which enables you to pay for out-of-pocket medical expenses using pre-tax dollars. If you’re in the 15% income tax bracket, it’s like getting a 15% discount on all the health-related charges you incur, from doctor bills to eyeglasses.
If you’re even more daring, a so-called “catastrophic” plan might be worth a look. These offer bare-bones protection – you’re covered for three office visits a year – but saddle you with higher deductibles and co-insurance expenses. Not everyone qualifies, either. You have to be under 30 years of age or obtain a hardship exemption that demonstrates you were unable to afford coverage on the exchange.
See if you’re eligible for Medicaid
In its quest to increase the number of insured, the ACA created a minimum eligibility for Medicaid, the joint federal and state health care program for low-income residents. Now that threshold must be at least 133% of the national poverty level. That’s $15,521 a year for an individual and $31,720 for a family of four. If you’re historically in the middle class but your income has dropped recently – for example, you went part-time at work because you’re taking classes – you might just qualify. You’re chances are even higher if you live in a state that’s raised the income cut-off above the federal requirements.
Fortunately, determining your eligibility for Medicaid doesn’t require any extra work. The same application that you fill out to see if you can get a tax credit will tell you whether you’re entitled to Medicaid benefits.
Investigate parent’s plan
A lot of college graduates these days are having a tough time finding a full-time job with health insurance. However, the ACA is making it a lot easier for cash-strapped young adults to get coverage.
Now, individuals can join or stay on their parent’s plan until they turn 26. There are some restrictions here. You have to be single and living under your own roof. You also have to be financially independent and ineligible to obtain insurance through your employer’s plan.
The Bottom Line
One of the easiest ways to save money is to compare plans sold on an exchange and those sold directly through a carrier. But keep in mind that policies with lower premiums aren’t always the best deal if they mean dramatically higher deductibles and co-insurance.

3 Things That Could Hold Intuitive Surgical Back

Let me be clear from the start, I am an Intuitive Surgical optimist. But just because I have taken a long-term view that favors the robotic surgical system developer increasing in value, it doesn't mean I'm not attuned to the idea that there are near-term headwinds facing this company.
With that in mind, let's take a look at three headwinds that could keep Intuitive Surgical from having a banner year in 2015.
No. 1: The Affordable Care Act overhang
The Affordable Care Act, which most people know as Obamacare, is widely expected to be a boon to the healthcare sector as a whole over the long run. As more people become insured, the number of prescriptions written and surgical procedures performed is expected to rise, resulting in a windfall of profitability throughout much of the industry.
Unfortunately, Obamacare is about as far from cut-and-dried as it gets. Even though, as the White House noted, approximately 11.4 million people enrolled in health insurance in the 2014-2015 open enrollment period, all eyes are on a pending Supreme Court case, King vs. Burwell. This case, which should get a decision in June, revolves around the legality of the federal government paying out subsidies via Healthcare.gov. As a reminder, Healthcare.gov covers 37 states and enrolled 8.8 million of those aforementioned 11.4 million people. If the justices find in favor of the plaintiff, more than 7 million people would likely lose their subsidies and, subsequently, the ability to afford health insurance.
"What does this have to do with Intuitive Surgical?" you ask? Because this unresolved case is still a few months out, hospitals and primary care providers are likely going to hold off on making large purchases in case of an unfavorable ruling. If millions suddenly lose insurance, it could mean less revenue and profits for these companies. With the da Vinci surgical system costing close to $2 million, it's a potentially easy casualty. On the other side of the coin, the millions of Americans currently receiving a subsidy via Healthcare.gov may hold off on surgical procedures for much of the same reason: uncertainty.
Together, these factors could really sap sales of da Vinci's core machines for the first half of 2015.
No. 2: Ongoing FDA investigations into robotic surgical safety and efficacy
One cloud that won't seem to go away is the ongoing concern regarding the safety and efficacy of the da Vinci surgical systems.
The idea of the da Vinci robotic system is that it gives trained physicians the ability to make smaller incisions for soft-tissue surgeries that should heal more quickly than traditional laparoscopic surgeries. The flip side to that is that robotic-guided surgeries often have a price premium that patients or insurers have to justify.
Following a rising series of complaints against the da Vinci surgical systems, the U.S. Food and Drug Administration opened an investigation in 2013 into the safety and efficacy of Intuitive Surgical's device. It's quite possible the increase in complaints has only to do with a proportionate increase in the number of procedures being performed, but there still is the potential that the FDA may need to reexamine its position on Intuitive's robotic devices.

In the meantime, persistent questions regarding the safety of its surgical device could dampen Intuitive Surgical's sales potential.
No. 3: A share buyback
Lastly, I'd suggest that Intuitive Surgical's $1 billion share repurchase agreement, which it approved early last month, could actually do more harm than good.
To begin with, investors like to think of Intuitive Surgical as a growth stock. It has strong pricing power as the only dominant and profitable developer of soft-tissue robotic surgical devices. It also has an enormous base of machines already installed, which would make it difficult for any competitors to try to unseat Intuitive's well-established markets and army of trained physicians. But if the company is diverting $1 billion away from research and development and companywide investments toward purchasing its stock instead, it could be a signal to investors that Intuitive's growth may be slowing.
Additionally, investors might wonder why Intuitive didn't just go the route of paying shareholders a dividend. A dividend would be a nice way of putting extra cash directly into investors' pockets. Instead, a share buyback could imply that Intuitive's EPS growth is slowing and it might need the extra valuation boost in order to justify its current valuation.
Either way, I see investors not being all too pleased by the move.
Think long term
While it looks as if Intuitive Surgical could be in for a volatile and perhaps rough 2015, I'd still remind investors to look to the horizon with their investment thesis on Intuitive Surgical. The company is leaps and bounds ahead of its peers in terms of training physicians and installing its robotic surgical machines in hospitals around the country. It's unlikely to lose the pricing power on its machines, procedures, or servicing any time soon. So while the company may be hitting a rough patch in its growth now, I'd still proclaim it to be in pretty good shape over the next five years and beyond.
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Sean Williams has no material interest in any companies mentioned in this article.

The Middle Class and Long Term Care Insurance

The cost of long-term care can be very high. Nationally, a one-year stay in a nursing home averages $87,000, though it can be significantly higher in certain parts of the country. The average in the New York City area, for example, is $136,000 per year, and is even higher in Alaska. In-home care, while cheaper, can still run around $50,000 per year or more.
It's often said that the rich don’t need long-term care (LTC) insurance, as they can afford to self-insure. It's also said that the poor don’t need it as they will be covered by Medicaid and other such programs. That leaves the middle class as the best candidates for this coverage. Here are few thoughts on long-term care insurance and how financial advisors can help their clients decide if this is the best route for them. (For more, see: Medicaid vs. Long-Term Care Insurance.)

What is LTC Insurance?

Long-term care insurance, like any type of insurance policy, is protection against some event that would be too costly to fund out of one’s pocket. Let’s say a married client had a $1 million retirement nest egg, which along with their Social Security and a small pension, provided an amount sufficient to support their retirement lifestyle. (For more, see: What is Long-Term Care Insurance?)
If one spouse developed a medical situation requiring a stay in a nursing home for several years, even at the national average cost of $87,000 per year, this could deplete the couple’s retirement savings in a hurry. Having long-term care insurance in place could certainly help offset some or all of this expense and preserve the couple’s nest egg.

Preserving an Inheritance

For many families providing an inheritance to their children, grandchildren and others is a priority. Long-term care insurance can provide a source of funds to pay for needed care. The money paid by the policy represents funds that an individual will not have to pay out of pocket and in this case can potentially be preserved to pass on to their heirs as desired. (For more, see: Leaving Inheritance to Children: Easier Said than Done.)

Getting the Care Needed

People are more likely to get the care they may need if they have the means to pay for it without ruining the financial situation of loved ones. This alone would seem to be reason enough to consider long-term care insurance. (For more, see: Taking the Surprise out of Long-Term Care.)

Premiums

While annual premiums can easily be in the $3,000 to $6,000 range, this equates to the cost of less than one month in a nursing home based on national averages. (For more, see: How is My Insurance Premium Calculated?)
For most policies the premiums are not fixed. In Illinois a few years ago a large issuer of long-term care policies raised premiums in an aggressive fashion. In this case they were going after policyholders with a 5% inflation rider. They offered to keep premiums the same if the insured would drop down to a 3% rider, otherwise the increases ranged from 20% to much higher. (For more, see: A New Approach to Long-Term Care Insurance.)
Premium hikes will likely not be uncommon going forward, as many insurers did not count on people living as long as they are. (For more, see: How Advisors Can Help Address Longevity Risk.)

Riders and Elimination Periods

Choosing among all of the various features available with today’s long-term care policies is akin to shopping for a car. Do you want cloth or leather seats, a premium sound system, etc.? (For more, see: Considerations for Long-Term Care Coverage.)
An inflation rider is often a good idea as the cost of healthcare in general and long-term care costs specifically seem to increase faster than inflation.
Another decision is the length of benefit coverage. Lifetime protection, protection for five or three years are common. The length of the period of consecutive days of eligibility for benefits until coverage starts can also influence the cost. A longer elimination period (180 days versus 90 days, for example) will reduce premiums. (For more, see: Financial Advisor Client Guide: Long-Term Care Insurance.)

Helping Clients Make the Decision

Financial advisors can help their clients decide whether or not long-term care insurance is a viable option for them, and if so, what type of coverage and policy features makes sense. Advisors are in a position to understand the client’s overall financial situation as well as their goals. An independent financial advisor can also help clients shop for a policy and to select a reputable source whether it is an insurance agent or other outlet. (For more, see: Long-Term Care Insurance: Who Needs It?)

The Bottom Line

Healthcare costs and the costs of long-term care are rising and can be a huge burden in retirement. A situation requiring this level of care can deplete a retirement nest egg quickly. This can be a hardship for the caregiver, spouse or family members. Long-term care costs are generally not covered by Medicare or regular health insurance policies. Though they are costly, long-term care insurance policies can pay off in a big way for clients by helping them pay for the care they need without depleting other financial resources. (For more, see: Failing Health Could Drain Your Retirement Savings.)

Find The Cheapest Health Insurance Providers

If you’ve recently lost your health insurance, or have been putting off enrolling in a plan, February 15 may be your last chance of the year to purchase a policy for 2015 through the Affordable Care Act, which is likely to be the least expensive way to buy insurance.
The tax penalties for not being insured are twice as high for 2015 as they were for last year – 2% of your annual household income, or $325 per adult and $162.50 per child, whichever is higher. This is up from just 1% in 2014 and will rise to 2.5% in 2016. (Note that you can be uncovered for less than three months, after which you'll be assessed 1/12 of the penalty for each month that you're uninsured.)
Whether you’re young and healthy, “never go to the doctor” or have a high enough income to think you can handle whatever comes up, it pays to take another look at the relative costs. While the tax penalties may indeed be cheaper than the cost of the lowest premium health insurance, if you have even a minor medical emergency it can cost you a bundle. And there’s no putting a price on the peace of mind that comes with knowing you and your family are covered when health needs arise.
Here’s a quick guide to finding a policy at the last minute.
Where To Start
To avoid penalties you need to buy insurance that includes “essential benefits” as defined by the Affordable Care Act. You can preview, compare and buy policies at the healthcare.gov website or call the 24/7 hotline (1-800-318-2596). You can also buy insurance through an agent or broker. If you think you may be eligible for tax credits be sure that they enroll you in a marketplace policy. (Tips On The Health Insurance Marketplace /Exchange explains this. You may also be interested in Where To Find Affordable Health Insurance.)
You don’t have to be poor to qualify for tax credits on healthcare.gov policies. For example, a two-person family who earns up to $62,920 a year can qualify for credits. A four-person household can qualify with an income of up to $95,400. And an eight-person household up to $160,360.
What You’ll Need
Don’t worry about detailing your medical condition. Insurers at healthcare.gov cannot reject you or charge you more because of preexisting health conditions. You will need to supply information about your household size and income. “Household size” is the number of dependents you list on your income tax return, not how many people live in your home. (Look it up in IRS Publication 501.) Income is the “federal taxable wages” on your pay stub or income tax return; as you apply you can list certain deductions, such as school tuition costs. You will also need to estimate your expected household income for 2015.
Inexpensive Plans Are Available
If your goal is to spend as little as possible on premiums, consider the bronze plans at healthcare.gov. For example, a couple, both 45 years old, who live in Philadelphia and earn $60,000 a year, have a choice of 40 health plans. The cheapest policy we found is the United Healthcare Bronze Compass HSA 4900. This couple qualifies for a tax credit, which is applied to the premium. Their monthly premium would be $369 a month (it would cost $494 a month without tax credit). It has an estimated total family deductible of $9,800 a year, and a $12,900 estimated family total out of pocket.
You May Qualify for Special Enrollment
Anyone can purchase health insurance during the open enrollment period. (Hurry! For 2015 insurance, open enrollment began November 15, 2014 and closes February 15, 2015.) But in special circumstances you can enroll at any time of the year. That applies if you’ve:

– lost health insurance in the last 60 days because of job loss, divorce or a move outside your health plan’s coverage area.
– gotten married, had a baby, adopted a child or had a child placed with you for foster care, or someone in your household has died.
– had a change of income, gained citizenship or lawful presence in the U.S., or been released from prison or detention.
The Bottom Line
Yes, it may be cheaper to pay the tax penalties than to buy even the least expensive health insurance policy, but the tax penalty buys you nothing. Even if you’re in perfect health, the costs of an unexpected accident or emergency can be breathtaking.
For example, if you needed to have your appendix removed, it cost an average of $33,000 nationwide and as much as $180,000 in some locales in 2009. One 20 year old from Sacramento, Calif., reported being billed $55,000 for the procedure in October 2012. While his insurance paid most of it, he had to pay more than $11,000 from his own pocket. So even if you have insurance, do check the maximum amount of out-of-pocket costs you might be required to pay in a year. Many people will need both insurance and personal savings to handle the unexpected.
If you miss the deadline and aren't eligible for an exemption, you can still buy insurance from an insurance company or broker and minimize any tax penalties. However, you won't be eligible for marketplace subsidies and other benefits of the Affordable Care Act.

Obamacare Penalty Enforcement: How It Works

We’re only days away from a deadline (February 15, 2015) that could cost you a lot of money if you’re not in compliance. You may have missed hearing about it on the news, but it’s vitally important that you address it. It’s the date when open enrollment through the Health Insurance Marketplace for 2015 ends.
If you don’t have qualifying insurance through some other means, you probably want to get it through the Health Insurance Marketplace (see Find The Cheapest Health Insurance Providers). If you don’t, you may have to wait until November for the next open enrollment period to open or get insurance through a private company.
Here’s how it works. Under the Affordable Care Act, also known as Obamacare, you are required to have health insurance. As long as you have insurance through your employer, insurance your purchased on your own, Medicare, Medicaid, a Veterans plan or some other qualifying coverage, you have nothing to worry about. You can check to see if your plan qualifies by clicking here.
How You Pay the Penalty
If you don’t have health insurance you pay a penalty on your tax return at the time you file your income taxes.

If you didn’t have health insurance in 2014, you will pay 1% of your household income or $95 per person – whichever is higher. If you have children under 18, the cost is $47.50 per child. There’s nothing you can do right now about 2014, other than talk to a tax specialist and hope that there’s something that will exempt you from the penalty (see below).
If you don't have health insurance in 2015, the sting of the penalty will be even worse. You’ll get hit with 2% of your yearly household income or $325 per person – whichever is higher, or $162.50 per child under 18.
Getting an Exemption
Like anything involving taxes, there are exemptions and situations where the penalty can be reduced, but you will likely need the help of a tax advisor to figure it all out. You can see if you qualify for an exemption from the penalty by clicking here.
Getting Coverage Between Enrollment Periods
You're out of luck if you missed the deadline, except under certain circumstances when you can still enroll through the Health Insurance Marketplace. If a major life event happens – you have a baby or lose your job, for example – you can get coverage through the Marketplace during non-enrollment periods. Click here to learn more about what the Marketplace calls "qualifying life events."
Also check with your state. Some states run their own Health Insurance Marketplace.
The Bottom Line
Time is running out. You only have a few days to get healthcare during the current open enrollment period at the Health Insurance Marketplace (see Avoid the Obamacare No-Insurance Penalty By Feb 15.) . If you miss the window, your coverage might be more expensive and your tax bill could be hefty in 2015. If you still need coverage, click here to sign up for coverage.

Tips On The Health Insurance Marketplace/Exchange

Whatever your political views of the Affordable Care Act of March 2010 (ACA) – better known as Obamacare – there’s good news if you need to buy health insurance for yourself or your family for 2015. The website hosting the Health Insurance Marketplace, or Exchange, where you can apply for insurance has emerged from its early problems and added new features that make it easier to use.

For example, this year on the federal exchange you can easily preview the policies, rates and tax credits (applied in advance) you are eligible for by answering just a few questions before you go through the formal application process. Thirteen states plus the District of Columbia have their own exchanges and the rest rely on the federal exchange; entering your zip code into HealthCare.gov will get you to the right one.

Owners of small businesses with 50 or fewer employees can insure their employees. Those with fewer than 25 full-time employees may qualify to receive tax credits through the SHOP (Small-Employer Health Option Program) exchange. The promised “employee choice” option that would allow a business’ employees to choose among a variety of plans in a selected tier is available in 14 states for 2015. But employee choice has been delayed until 2016 in 18 federal exchange states. In those states, employers will only be able to offer a single health and a single dental plan to employees.

The long-term future and shape of the ACA is still a work in progress due to an upcoming decision by the Supreme Court and the political shift in Congress. But for today, the federal insurance marketplace, and those implemented by various states, are up and running. About 7.1 million people bought health insurance under the ACA for 2014, a figure that’s expected to reach 9.1 million in 2015
Applying is a fairly complex process, and it's a good idea to start now. Enrollment began on November 15, 2014, for coverage starting as early as January 1, 2015. February 15, 2015, is the last day to enroll for 2015 coverage.

Here are five key things individuals and families need to know to avoid frustration and get the insurance they need.

1. Be sure you're eligible to apply.

Whether you’re a 26-year-old just coming off your parents’ policy, a parent who needs affordable coverage for your family, or a 55-year-old who has lost employment and/or health coverage, you should be able to find a suitable insurance policy and may be eligible for significant tax credits (delivered in advance in the form of reduced premiums) to help you afford it.
People who cannot use the marketplace include those who have an employer-sponsored health plan, including COBRA – or who have Medicare, Medicaid or TRICARE for military families.

2. Understand that health conditions do not raise rates.

The great boon of the Affordable Care Act is that insurers cannot reject applicants or charge them more because of pre-existing health conditions or gender. Rates do vary depending on age, where you live, whether you're buying individual or family coverage, and whether the applicant uses tobacco.

3. Collect key information before you start.

When you apply for insurance – or even preview the rates and tax credits – you’ll be asked about your household size and income. While these may seem like straightforward questions, there are many permutations, so be sure to check before you answer them.

“Household size” is a misnomer because it actually means “dependents,” not the number of people who live in your home. For example, if your parents or unmarried partner or his/her children live with you but are not your dependents on your tax return, they don’t count. In addition, anyone who is your dependent but doesn’t live with you should be included.

“Income” is even more complicated. If your pay stub lists “federal taxable wages” that is the figure to report as income. As you apply, you can also list certain deductions, such as alimony you pay or school tuition costs. Other items, such as child support and proceeds from loans, do not have to be included as income.

When you apply, you will also be asked to estimate your income for 2015, and your tax credits will be based on that figure. Tread carefully. If you make more money than you estimate, you could wind up having to pay back some of the tax credit savings when you file your next tax return.

4. Choose the right plan for your needs.

All plans must offer the same “essential health benefits,” which include coverage for outpatient care, emergency services, hospitalization, pregnancy, maternity and newborn care, mental health and substance use services, prescription drugs, and laboratory and wellness services.

The differences among plans involve premium prices and the size of deductibles and coinsurance. Disclosure is very clear and includes the tax credit you may qualify for and the maximum amount of out-of-pocket expenses (which includes deductibles, coinsurance and co-pays) you would have to pay for a year.

In many areas, a dizzying multitude of plans is available. For example, 94 plans are available for a Florida family of four (ages 45, 43, 10 and 6) with an income of $60,000, who qualified for significant tax credits for all plans. Here’s a sampling of the range of plans:

Sample Plans for A Family of Four in Florida

Plan	Monthly Premium	Deductible	Maximum out-of-pocket costs
Humana Bronze 6300/South Florida HUMx (HMOx)	$369	$12,600	$12,600
United Healthcare Silver Compass 4000	$695	$8000	$13,300
Florida Blue (BlueOptions All Copay 1424	$1572	$0	$4000

You can also search plans in “metal level” categories: bronze, silver, gold, and platinum, which signify how much of the total costs of an average person’s care they pay. For example, with a bronze plan you pay about 40% of the healthcare costs, and with a platinum plan you pay 10% on average. A separate category of catastrophic plans, which pay less than 60% of costs are available only for people under 30 years of age and those with a hardship exemption.

5. Avoid penalties for being uninsured.

The individual responsibility requirement (known as the “individual mandate”) in the Affordable Care Act requires all citizens to obtain minimum standard health insurance starting in 2014. Your tax return will ask for information about your health insurance coverage.

The penalty in 2015 for not having health insurance is $325 per adult and $47.50 for a child, or 2% of your total household income, whichever is greater. In 2016, the penalty will be higher: $695 for each adult and $347.50 for each child, up to $2,085 per family, or 2.5% of family income. Certain groups of people are exempted from the penalty.

The Bottom Line

If the idea of buying health insurance on a website makes your head spin, remember that many insurance agents and brokers can help you with the process. If you think you may qualify for tax credits, make sure they enroll you in a marketplace plan.

To find a plan on HealthCare.gov, you can search by “metal level” categories for the amount of coverage you desire. Or, you can look at all plans you qualify for and sort them in order of either deductible or premium amounts. If you have difficulty enrolling, call the 24/7 hotline 1-800-318-2596. For further help, enter your zip code at Healthcare.gov to find a list of local community groups that will assist you. Once you’ve purchased a plan, stay alert for announcements for the "open enrollment" period for 2016 insurance, when you can renew or switch plans.