What Does The Economic Relief Package Do To Supplement Health Insurance?

One of the biggest deficiencies in the American system of health insurance is that there is very little standardization. Each plan is different. And the devil is in the details, as they say. Your plan might not cost much in weekly or monthly premiums, but it probably won’t provide much of a benefit either. A yearly checkup and a few prescription drugs? No problem. But an emergency room visit that leaves you responsible for paying off a high deductible before your health insurance kicks in a dime? Huge problem.

The harsh reality is that a person can be insured on any plan and still be financially ruined due to COVID-19. The economic relief package passed into law by Democrats addresses some of these concerns.

Director of the National Center for Coverage Innovation at Families USA Stan Dorn said, “If Congress can circle back and make these improvements permanent, it will go a long way toward making insurance affordable in this country.”

Civil rights attorney John Stackett said, “One of the biggest issues with previous relief packages was that they provided protections that disproportionately left minority groups out in the cold. The Biden package does better, but it probably still doesn’t go far enough. Right now, families living below the family line will receive a small payment monthly for the rest of the year. We needed that terribly, and we hope to see an extension in the future.”

What does all this mean? Essentially, it means that health insurance is still far too expensive for many working families in the United States. But by providing what is basically a universal basic income (UBI) for parents, Democrats have found a round-about wait to make insurance payments more manageable. The trick is getting the payments renewed after this year — but as we already know, it’s very difficult to take away this kind of benefit once people have it. And Republicans will have to struggle for how to respond to this when they’re running in the midterm elections next year.

Biden has also ensured that open enrollment for the Affordable Care Act will stay available for months, which is great for people who lose employer-provided coverage. Many citizens are still out of work, and they need healthcare coverage now more than ever. 

The American Rescue Plan Act also removes repayment requirements for premium tax credits, which should go a long way into helping families who don’t have any extra funds on hand to pay them. It’s worth noting that those who use the ACA to find coverage must update demographic information now in order to guarantee these changes have the desired effect. 

Stimulus Payments Delayed For Social Security Recipients — Because Of Trump?

We already knew that payments for the economic relief package most recently passed by Congress and signed into law by President Joe Biden were delayed for certain groups of people — but now we may have a better idea of why. House Democrats believe that delays for the $1400 individual payments may have been purposely delayed by former Trump employees in the Social Security Administration.

Those waiting on social security disability checks are accustomed to long wait periods — even being approved for SSDI can take two years — but experts warn that lives could be lost in the interim.

House Ways and Means Committee chairman Richard Neal (D-Massachusetts) said, “We understand that these beneficiaries are waiting because the Social Security Administration has not sent the necessary payment files to the Internal Revenue Service.”

An SSA spokesperson said, “Social Security staff is working day and night with Treasury and IRS representatives to ensure that the electronic file of Social Security and SSI recipients is complete, accurate, and ready to be used to issue payments.”

Once the SSA provides the requisite information, it could be a week or two before anyone currently on social security receives a check.

IRS Commissioner Chuck Rettig provided his testimony at a Ways and Means Committee hearing: “Many of these folks are also entitled to an [earned income tax credit]. They’re also entitled to a child tax credit. We did not get that information from the non-filer portal.”

The current head of the SSA wants to implement deep cuts to the organization, which is a non-started for Congressional Democrats. If it seems strange that a Trump appointee would want to make cuts to the programs he oversees, don’t forget that he also appointed a climate change denier to head the Environmental Protection Agency (EPA). When Trump wanted to gut funding for a particular organization, he attacked from within.

Those still waiting on relief payments can visit the “Get My Payment” portal to find out if the check has already been sent.

The House Ways and Means Committee released a written statement to explain the delays: “The American Rescue Plan was intended to provide much-needed economic stimulus and assistance to people across the country — immediately — and we are counting on your agencies to ensure that beneficiaries are not left behind in the seamless delivery of those payments.”

It continued, “However, we were alarmed to learn recently that most Social Security, SSI, RRB, and VA beneficiaries who are not required to file a tax return have not yet received their payments and the IRS is unable to provide an expected timeline for these payments. Some of our most vulnerable seniors and persons with disabilities, including veterans who served our country with honor, are unable to pay for basic necessities while they wait for their overdue payments.”

Are you an SSDI or SS recipient? There’s no need to worry if you normally file taxes with the IRS. Your information should be on file and your payment should be scheduled normally.

Insurance Terminology You Need To Know: Part V

We believe that people should know and understand exactly what their insurance policies say and mean. But insurance companies purposely use a lot of jargon and complicated terminology that the average person could never (or would never want to) wrap their heads around. That’s why we’re going to do it for you. Here are a few insurance-related terms that you might find in any policy you’ve purchased, and what they mean.

Actual Cash Value

This term refers to the value of repayment requested after a financial loss (most usually due to property damage). You’ll also see it coupled with the word “indemnification,” which refers to the protection of one party when a third party is damaged. 

Actuary.

This term refers to the professional responsible for determining the level of risk that an insurance company might be willing to accept. The actuary determines the equations for calculating premiums, dividends, etc.

Adjuster. 

If you ever need to cash in on a policy, then the insurance adjuster is the one who will investigate your claim. Basically, the adjuster’s job is to never give you an inch and not give you the company’s money unless a certain standard is met. They determine the claim’s worth in relation to the policy’s cash value.

Admitted Assets

These are an insurer’s valuations for specific assets. You’ll find them on the balance sheet.

Advance Premiums.

Normal premiums are the price you pay — usually once a month — once you’ve agreed to purchase a policy. An advance premium means you’ve paid…in advance. 

Affiliate.

Insurers refer to anyone who is under the insurer’s control as an affiliate.

Agent.

These are the insurance lackeys who sell their services. They don’t always work for the insurance provider. Sometimes providers will ask a third-party for sales work.

Aggregate.
This word refers to the most money you can have returned from a single loss (total coverage).

Life Sentence Given To Man After Insurance Collection Plot

Most rational people on planet Earth would recognize the futility of planning a murder (or two or three) in order to collect a massive life insurance settlement. And yet, it keeps happening. Hawthorne resident Ali F. Elmezayen, 45, was sentenced to 212 years in federal prison after the buffoon took out accidental death life insurance policies on his two kids and wife — and then partially carried out the plot when he drove his vehicle off the Port of Los Angeles.

His wife survived, but his two disabled sons died. 

Judge John F. Walter imposed the maximum sentence available when he ruled for 212 years. Walter said, “He is the ultimate phony and a skillful liar…and is nothing more than a greedy and brutal killer. The only regret that the defendant has is that he got caught.”

Elmezayen was also slammed with $261,751 in restitution fees that were paid out as part of the accidental death policy.

An anonymous lawyer for a personal injury law firm (https://www.socalinjurylawyers.com/) commented that these types of cases were surprisingly plentiful: “People don’t realize that they can’t possibly get away with it. The first person they suspect is the closest person in the deceased’s life.”

Acting United States Attorney Tracy L. Wilkison said, “Mr. Elmezayen conceived a cold-blooded plan to murder his autistic sons and their mother, then cash in on insurance policies. He now has ample time to reflect — from the inside of a federal prison cell — on where his greed and self-interest took him. We continue to grieve for those two helpless boys who deserved better from their father, who will never again walk among us as a free man.”

The scheme was poorly planned from the beginning. Before the plot was executed, Elmezayen contacted the relevant insurance companies a number of times — sometimes posing as his wife — in order to ensure the eight insurance policies he had purchased for more than $3,000,000 would pay out without much scrutiny. Prosecutors say one of his motivations was a bankruptcy he filed the year he purchased the policies (which he couldn’t even afford). 

Assistant Director in Charge at the LA FBI Field Office Kristi Johnson said, “Fathers are supposed to protect their children but instead, Elmezayen drove his boys straight to their certain death in exchange for cash. The defendant maliciously planned the death of his autistic sons and gave them virtually no chance of survival. The investigation that led to today’s sentencing won’t give them their lives, but affords them justice in death.”

Insurance policies have a “contestability” period. Once it expires, there are no longer any investigations into the cause of death. Theoretically, Elmezayen could murder his family only days after the contestability window expired and no one would bat an eye. He waited only 12 days. Funny thing: the FBI tends to take notice of such aberrations in the system. Who knew?

What Are “Nuclear Verdicts” And How Do They Affect Insurance Rates?

We rarely think about how the transport industry works. But maybe we should. Every year, millions of trucks — gasoline-fueled missiles, rather — travel from one end of the United States to the other. We’re talking hundreds of millions of miles traveled on an annual basis. With those kinds of numbers, accidents are inevitable. And what happens when those accidents lead to massive lawsuits that wind up in court?

Mike Card is president and CEO of Combined Transport. He took over the business from his father, who started it in 1980. And suffice it to say, business is better than ever. This is in part because of the reliance on material goods during the coronavirus pandemic. The government relies on some trucking services to get vaccines and PPE from one region to the next. But Card says the bigger the business gets, the more he worries.

He commented, “If someone wins $20 million from the jury, my insurance companies only pay the first $5 [million]. I would have to pay the next $15 million. We couldn’t afford that. We’d have to shut our doors.”

It’s a legitimate concern. From 2010 to 2019, the number of trucking accidents with fatalities blew up 43 percent. Overall injuries rose 7 percent. Needless to say, most of the casualties were passengers or drivers in other vehicles.

Combine that with the epidemic of “nuclear verdicts” — or the ballooning costs and jury awards from those crashes in excess of $10 million, and you get a lot of worried business owners. The aforementioned 43 percent increase in fatalities doesn’t come close to the whopping 1000 percent increase in jury awards during the exact same time period.

Why are the awards getting so high so fast? Liberty Mutual Insurance says that the main reason is the idea that the system in general is broken (and hint: it is). 

But the trucking industry is more likely to receive a punitive judgement (i.e. a punishment from the judge) for gross negligence than many other industries. That’s because truck drivers are often fatigued behind the wheel. Coupled with the fact that some drivers are allowed to keep their drives even without a flawless driving record, and it’s easy for a personal injury lawyer to win a case for injured plaintiffs.

An anonymous lawyer from Koonz McKenney Johnson & Depaolis LLP (https://koonz.com/) said, “99 percent of the time, it’s the business owner’s fault. It’s the hiring practices, the overtime hours, the broken laws and regulations that lead to the majority of these accidents. Ordinary people are the ones who pay the price with their lives. Why shouldn’t we take the owners to town for their mistakes? Someone has to reimburse victims for the damage done, and it’s got to be the ones responsible. The drivers are just tools for those business owners. And so we target the business owners.”

But senior vice president of the American Transportation Research Institute Dan Murray says, “In most states there’s a disconnect between your level of negligence and your level of liability. There are states where you can be identified as 10 percent of 15 percent negligence and still be vulnerable for 100 percent of the financial liabilities.”

Insurance Terminology You Need To Know: Part II

Welcome to part two of our series on insurance terminology. Some of these definitions are common knowledge, while others might be more obscure. If you’re a new buyer, then you’ll want to know what you’re getting yourself into before you make any final decisions. That’s where we come in. Here are a few more terms to know before exercising your purchasing power!

What is an allowed amount?

The allowed amount is the highest dollar amount that an insurance company will ever pay. Here’s an example of the world’s worst healthcare plan: 75% coinsurance, $9,900 deductible, with a $25 allowed amount. This scam means the highest amount the company would pay is $25, and only after you’ve paid the $9,900 deductible. Plus, you’ll have paid another $75 to obtain their $25 via coinsurance. Whoops! Buyer beware.

What is a condition?

In healthcare, a condition is the illness or disease covered or not covered by insurance. Be wary of insurance contracts that don’t cover common health problems like heart disease or cancer. They might serve for a broken leg, but nothing else. 

What is a copayment? 

Many insurance contracts involve some sort of a copayment when you use a particular service. Let’s say you need to visit the doctor for a health problem you recently noticed. The plan might note that the deductible is irrelevant for this service, but that there is a $25 copay. That means the visit is covered by insurance, and all you’ll have to pay is the $25. Not too shabby.

What is a covered charge?

Covered charges are exactly what they sound like: they’re charges made to the insurance provider for covered services. This is of particular relevance to those who might be traveling, because they’re more likely to need the healthcare services of an out-of-network establishment. Most insurance providers will place a strict limit on the covered charges when venturing out-of-network.

What Is Divorce Insurance?

Divorce insurance is something that many married couples “Google search” for when tying the knot — and no wonder, because 9 out of 10 people will marry by the time they reach age 50 and up to half of those couples will inevitably divorce. But unfortunately divorce insurance doesn’t actually exist. There was a sort of divorce insurance “test” back in 2010, but big shock: it didn’t work out for the insurer. The theory was simple enough. Married couples can experience financial upset during divorce, so why not offer them a backup plan?

Probably the biggest problem with the actual “divorce insurance” concept is that there are already fail-safe measures that can be preemptively taken by couples if they want to protect their financial interests against divorce. But even those measures are scrutinized and stigmatized because marriage is supposed to be a lifetime vow — a commitment. Take the prenup, for example: the legal contract can stipulate what would happen should divorce take place, and is signed before the marriage licenses are obtained.

The difference between a prenup and the doomed divorce insurance was simple enough, though. A prenup is an agreement between two committed partners, while divorce insurance was an agreement between a business and just one of those assumedly committed partners.

But the problems with divorce insurance are equally obvious. Do you think an insurance company willingly pays out a settlement unless forced? Not a chance. When you’re in a car accident between two or more parties, the insurance company literally sends out highly qualified and well paid individuals to make sure the story you provide is the right one. If you were the cause of the accident, don’t expect to get anything that isn’t owed.

But how do you make an agreement that basically says “if you divorce this person, you’ll receive this benefit”? The coverage basically becomes about what would happen under set conditions, just like any other insurance. Your spouse cheated on you and you want a divorce? Great. Your divorce insurance benefit should pay up. But first you need to provide beyond any shadow of a doubt that your spouse actually cheated. Any footage of that event? Hint: you’re probably breaking a half-dozen laws by having footage of that event, much less sharing it.

So you can see why the coverage options were likely doomed from the beginning.

But there’s probably no replacement for a traditional divorce attorney. Looking for one? You can visit website of any local attorney you choose, and most will always offer a free consultation to see if you’re a good match.

An attorney can also help relevant parties come to a marriage settlement, which is typically an agreement made to iron out details of who pays what (think alimony or child support) after marriage. The might also include more immediate concerns like assets, child custody, child visitation rights, etc. It’s always a good idea to know what you want out of a marriage — and what you want out of a divorce.

Check out some of the coverage when divorce insurance was first offered:

How Are Employers Covered By Business Insurance?

Insurance was a scheme devised to help people protect themselves from risky ventures. While we might not think of owning a vehicle as a “risky venture,” tens of thousands of people die in wrecks each year — and that makes it a fair risk for personal injury or financial loss. And there are many different types of insurance ranging from pet insurance to business insurance. There is no greater risk than starting a new business. It’s hard work. Success is not always guaranteed. So why should business owners insure themselves, and what does business insurance cover?

Business insurance usually consists of general protections to guard against natural disaster, property damage, lawsuits, and “shrink” (which is profit loss due to product damage or theft). It comes down to liability. In many cases the business owner is liable — but can buy insurance to offset those liabilities. 

Depending on the type of business insurance, the owner might have legal or financial options if an employee reports discrimination in the workplace. In order to maintain coverage, an owner would likely be asked to exceed state and federal regulations on discrimination by offering extensive training courses and workshops designed to further mitigate the risk of these types of reports by employees. 

Many entrepreneurs will purchase a Business Owner’s Policy (or BOP). These policies combine several different types of coverage, including property protection, general liability, and business income protection. BOPs are popular because they represent a deal — entrepreneurs can save money on one type of coverage by combining it with many other types of coverage. The more protected, the more you stand to save if the worst happens (and the less you spend on the insurance itself).

A BOP will help protect an owner against other claims as well, frivolous or not. Sooner or later, a customer will likely report sustaining an injury in your store. This is an inevitable consequence of running a business. If you need to fight the claim in court, the business coverage will help offset the costs of hiring a lawyer and making a case. The same type of coverage protects against customer claims that you falsely advertised a product or service.

Many business owners will want business income insurance, which will protect against losses sustained due to closure. The reasons for such a closure might include natural disaster, theft, or another kind of unforeseen damage. 

If your business involves greater-than-normal bookkeeping (if you own a law firm, for example), then you will likely want to obtain professional liability insurance to protect against a client who makes the claim that a small clerical error cost him money. The important thing to remember is this: making a mistake is all that is necessary for a costly lawsuit. It doesn’t mean you did something wrong. These suits can still be costly if you don’t have the appropriate insurance.

Workers’ compensation insurance — not to be confused with actual workers compensation — is insurance that guards against losses incurred because an injured employee can’t work (because they’re out on workers comp and cannot be easily replaced!).

What Would Happen To Insurance Rates If Obamacare Is Overturned?

The death of Ruth Bader Ginsberg means that new Supreme Court nominee Amy Coney Barrett will likely be seated before Election Day, providing the highest authority in the land with an overwhelmingly conservative 6-3 advantage — providing Republicans with the ability to overturn important historical benchmarks in our country such as marriage equality, Roe v. Wade, or even the Affordable Care Act (ACA).

This is why Democrats are in such an uproar. Majority Leader Mitch McConnell (Republican, Kentucky) said that the GOP has no expectation that the new Supreme Court will overturn the ACA — even though their Republican commander-in-chief is leading the charge to repeal the ACA through legal action expected to reach the Supreme Court. They say they want to “repeal and replace,” which is a talking point they’ve used for years and years — even without putting forth an actual replacement.

Should the ACA be repealed, it is expected that nearly 30 million people will lose their insurance. Also attached to the law are stipulations that all insurers, both public and private, are required to provide insurance to those with preexisting conditions. The repeal of the ACA means that insurers can remove those with preexisting conditions from their plans. Over a million people would also lose their jobs as less money is spent by consumers who would need to decide between insurance and other basic necessities like food or rent.

Insurance companies would also be able to take insurance away from countless 20-somethings, who under the ACA can stay on their parents’ plants until age 26. 

Because of these added benefits, insurance rates went up after the law was implemented — but most of the rate of growth was already expected by industry analysts looking at skyrocketing costs over the years. If the ACA goes away, a temporary lull in rising costs could be expected — but only at the cost of the benefits it provided.

Do Employers Have Insurance For Sexual Harassment And Sexual Assault?

Thanks in part to the ever-present #MeToo movement, the number of public cases against high-profile defendants accused of sexual harassment or sexual assault has grown exponentially over the past few years. Perhaps this is why we have received so many inquiries from readers who want to know whether or not large companies and corporations can buy insurance to protect themselves from the unwanted sexual advancements of their employees.

The answer is yes.

This will leave a foul taste in some people’s mouths, but for anything that can affect a business’s profits there is an insurance clause to cover it. There are a few different types of insurance that covers claims for sexual harassment or assault, such as an employment practices liability insurance policy (EPLI). Another possible avenue of protection is basic liability policy for directors and officers (D&O).

Not every claim will result in compensation — because the facts matter. Allegations of harassment or assault must meet the definitions provided by the Equal Employment Opportunity Commission (EEOC). According to this definition, sexual harassment is indicative of “unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature when this conduct explicitly or implicitly affects an individual’s employment, unreasonable interferes with an individual’s work performance, or creates an intimidating, hostile, or offensive work environment.”

We should make a few aspects of such a case clear based on this definition. First, the harassment or assault must be proved by factual evidence. Mere allegations are not enough. 

Vice President Marie-France Gelot of Lockton Northeast wrote, “Whether or not a claimant is able to actually make a case proving that sexual harassment occurred, the reality is that the bulk of liability faced by companies accused of such conduct is not generated after a jury trial. It is generated by attorneys’ fees in litigation, win or lose. In the current environment, this is a critical point; any perceived harassment can result in six-figure liability for a company, regardless of whether a judge or jury would ultimately find the harassment unlawful.”

That means that companies still pick up insurance simply based on the fact that a mere allegation can cost many hundreds of thousands of dollars — even if actual evidence of misconduct does not exist. This is in part due to the fact that any lawsuit will likely involve attorney’s fees for the other side, and a sexual abuse attorney can be pricey for a victim. 

Those seeking insurance — or those seeking damages for sexual harassment or assault — should remain keenly aware that the national conversation on this type of abuse is ongoing and that rapid-fire changes to laws in jurisdictions around the country and the world remain constant. That means that insurance adjusters are more likely than not to continue adjusting policies to reduce the possibility of collection from either side (because insurance only works properly if insurance companies cover aspects of everyday life that don’t often result in a good case). 

Gelot confirmed as much when she said, “It remains to be seen if EPLI insurers will react to the momentous changes occurring in the national conversation on sexual harassment in the workplace by limiting the scope of the coverage or making it more expensive.”