Replies

1. 
   xMikeSmith | Mar 29, 2003 05:06am | #1

   greg.. i had one for a couple of years.. but the more i thought about it , the less sense it made..

    three years ago , i incorporated.. and now i'm covered for job related injuries just like the rest of the employees of my company..... and the supervisory rate is pretty good compared to the straight carpenter rate...

   how much of your worry is about job related ?  thought about including yourself on your company's WC ?

   Mike Smith   Rhode Island : Design / Build / Repair / Restore

1. 
   Piffin | Mar 29, 2003 05:10am | #3

   Mike, what is your supervisor rate? and how much do they cover? I seem to remember about 2/3s of normal salary recorded..

   Excellence is its own reward!

1. 
   xMikeSmith | Mar 29, 2003 06:21am | #5

   pif... from memory.. my carps are about 11%.. i think i'm at 5%.. but i'd have to check the ploicy to swear by itMike Smith   Rhode Island : Design / Build / Repair / Restore

1. 
   JeffBuck | Mar 29, 2003 07:28am | #6

   How does Aflac(sp?) fit into all this?

   Is that anything worth looking into?

   JeffBuck Construction   Pittsburgh,PA

    Fine Carpentery.....While U Waite                  

1. 
   CHARITY116 | Mar 29, 2003 04:48pm | #7

   In a previous life, I was an attorneywho did a lot of ERISA work.  ERISA is the federal law that governs employee benefits (from retirement plans to things like disability plans).  Based upon litigating ERISA cases for ten years, for both employees and employers, if I bought a disability policy, I would NOT buy a policy that is going to be governed by ERISA.

   Georgia, where I live, is a fairly conservative state, but our state laws that govern insurance, including case law ("law" comes from at least three sources, legislatures (Congress, the State General Assembly), administrative agencies, and from court decisions).  Federal case decisions interpreting ERISA are almost uniformly "pro-employer, pro-administrator, pro-insurer."

   So, don't buy a policy "wearing your business hat," instead buy a policy wearing your "consumer hat."  What that means in a specific case is probably best explained by a competent CPA, but it includes things like (1) don't buy the policy through your business, but it out of your personal checking account, (2) don't deduct the cost of the policy as a business expense, instead treat it as a part of your household budget.

   Hope this helps. 

2. 
   Piffin | Mar 29, 2003 07:22pm | #10

   I'm afraid that left me totally confused, in light of the fact that wwe normally try to pay out as much as possible in the business for tax savings benefit.

   ie. - how do I benefirt by buying disability as an individual instead of through the compnay?.

   Excellence is its own reward!

3. 
   CHARITY116 | Mar 30, 2003 02:11am | #11

   I agree that, normally, one should expense every possible item.  The problem though is that an employer-sponsored benefit plan, regardless of what type it is (retirement, medical, disability) is governed by ERISA.  Insurance, on the other hand, is almost exclusively the province of state law.  ERISA has been interpreted by federal courts in a generally pro-employer, pro-insurer manner.

   For example, only an idiot benefit plan drafter would fail to include a "reservation of discretion" clause in the master plan document.  Typically, such a clause would say something like "the plan administrator reserves the right to interpret the plan document and to make findings of fact."  Under such a clause, its almost impossible to challenge the plan administrator's (which is often the insurance carrier) interpretation of the plan document or "findings of fact."

   In contrast, under Georgia law, insurance contracts (including disability insurance) are "interpreted" by courts (not the insurance company) and are "construed against the drafter."

   Also, as a tax issue, if you deduct the premiums, then if you ever need to collect on the policy, the disability payments will be taxable.  In contrast, if you purchase the policy "yourself,"  with no deduction, then any payments will be non-taxable.  (I would check with a good CPA to make certain this is still true.  I believe that it is.)  

4. 
   ehBeth | Mar 30, 2003 02:19am | #12

   I know that it varies from jurisdiction to jurisdiction, but there are a number of jurisdictions where the benefit paid out is non-taxable if you pay the premium yourself. It is taxable when the employer has paid for the premium.   Where I live and work, it is definitely beneficial to pay your own premium.  (there's a whole implied rant here on scammer employers who convince people they're getting a huge benefit by the employer kicking in about $10/person/month - it's usually a comparatively cheap benefit for the employer - and then the person loses about 30 - 40% of the benefit payable to taxes - grrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr).

    

   edit to say - i didn't read carefully enough - Chris covered this already (but i still think it's worth an extra note)

    

   If you can't play a sport, be one.

   Edited 3/29/2003 7:23:11 PM ET by ehBeth

5. 
   BillHartmann | Mar 29, 2003 07:02pm | #8

   I am not sure what there current products are, but in the past AFLAC had products that where sold, not bought.

   One of them was "cancer" insurance. If you had a major illness/accident you need the same coverage whether the cause was cancer or something else.

   From the ads that I hear now I think that they are focusing on selling through employeers. It does not cost the employer much to offer it. And they think that they are offering a benifit to the employees. It is the employees that end of paying it through payroll deduction. But check out what it covers and the return.

   I suspect that it high profit item with little return.

2. 
   Piffin | Mar 29, 2003 07:19pm | #9

   Mike, that doesn't sound too bad for both some medicl and income protection. I'll have to check with my MEMIC policy.

   Our rates are up around 14 - 17% for carps now.

   .

   Excellence is its own reward!

2. 
   Floorman | Mar 29, 2003 05:28am | #4

   A neighbor of mine (our association president), got rear ended a few weeks ago and his back was broken. The doctor performed surgery and placed a metal rod (ugg!) in his back. We saw him at a ten minute meeting to elect board members and he can stand with a cane, but he is a CPA and can still perform his job on some basis per day with lots of drugs. If that happened to us where would we be financially? Even if the other drivers insurance will pay a million dollar settlement at some point in time, like 3-5 years, that would put me out of my home in two years with my current savings. I'm not worried about job related so much. I do yoga twice a week and work out at the gym on Saturday to stay in shape. I don't lift heavy items for anyone. I respect my age and the limitations that come with it. GW

2. 
   Piffin | Mar 29, 2003 05:08am | #2

   you're right. There are lots of variables.

   time lapse until coverage kicks in

   potential monthly income covered

   total coverage

   renewability

   premium

   Self employeds are hard to cover and ascertain actuall income on if you aren't coverd by an accountant.

   I've been quoted from sixty/month for worthless disability insurance to over $800/mo for every thing I wanted - and less. ;)

   Just today, I was shown an offer (I'm about same age) for about $150/month for two grand of coverage from IDS financial services, with a hundred days until coverage kicks in. I'm seriously considering it.

   .

   Excellence is its own reward!