R&R Insurance Blog

Despite slight declines in accident rates, auto insurance rates have been on the rise for the past decade.  American car insurance rates have risen 29.6%, outpacing inflation and the increase in average car prices.

According to an article by Wired, a few culprits are to blame:

• Vehicle theft is rising
• Extreme weather, fueled by climate change, can destroy cars in a shorter amount of time
• Hurricane Harvey wrecked close to 1 million cars in 2017

The biggest culprit in rising auto insurance rates: the newer technology features within the cars themselves.

The reason: the sensors that power the systems make cars much more expensive to fix when they do crash.  Dent a steel bumper and a couple hits of a hammer will fix the issue.  Dent a bumper on a newer vehicle and it could mean repairing or replacing a camera, a radar, and ultrasonic sensors.  And then have everything calibrated!

Those who pay for blind spot warning, driving alertness monitoring, lane departure warning, night vision, or parking assistance systems may not actually save anything, depending on the insurance company.

Not to be overlooked, other leading causes of higher auto insurance costs:

1. Shift from halogen to carbon fiber.  It's lighter and stronger than steel or aluminum, but when damaged needs to be replaced.  In general, the cost of repairs has risen 5% to 6% annually since 2015, however frequency of crashes has dropped by 2% to 3%.  The gap explains the steep rise in rates.
2. Distracted driving. Smartphone use has risen from 35% to 81% in the past decade and have accounted for more than two-thirds of crashes.  Inattention behind the wheel has been blamed for the recent rise in traffic fatalities among pedestrians.  Insurance companies have responded by increasing rates for smartphone violations by as much as 23% year-over-year.

On the bright side, these higher rates may not last.  As mechanics learn to replace and calibrate sensors and as the prices of parts begin to fall, repairs should get cheaper.

Effective 2/1/2021, the Workers Compensation Rating Bureau (WCRB) will no longer issue courtesy postcard reminders to employers eligible to file for the Wisconsin Contractor's Premium Adjustment Program.

Read the full Circular Letter from the WCRB

WCRB will mail an orange WCPAP postcard notification to complete the WCPAP Online Application for one more renewal cycle (fiscal year 2020). 

Beginning with policies effective 7/1/2021 eligible employers should create their own reminders to complete their WCPAP Online Application every year. 

REMINDER: employers must submit a WCPAP Online Application every year, no less than 90 calendar days prior to the first day of the month of their worker’s compensation policy renewal.  The WPAP Online Application is updated every year on the evening of September 30th.  Therefore, you may complete this online application as soon as October 1st, regardless of your policy effective date.

Policies Expiring	WCPAP Online Application Deadline*
January	November 2
February	November 3
March	December 1
April	January 1
May	January 31
June	March 3
July	April 2
August	May 3
September	June 3
October	July 3
November	August 3
December	September 2

*Updated as of January 2020 - dates subject to change

 

This holiday season, you may find that online shopping is a convenient way to check items off your list. While shopping from the comfort of your couch has its benefits, have you considered the risks involved with having a package delivered to your front door? Package thieves, sometimes referred to as “package pirates”, are stealing millions of packages every year. According to a study done by C+R Research, 31% of individuals had a package stolen last holiday season. On average, stolen packages can be an expensive loss. According to a study by Ring last year, the median value of a stolen package was about $250. With the Holiday season among us and online shopping on the rise, you and your family may want to discuss some options to keep your gifts and deliveries safe. Here are a few tips for how to prevent a package theft from happening at your door step.

1. Outdoor Security Camera

   Installing a camera at your front door is a great way to provide piece of mind, and can deter a thief from attempting to steal your package. Doorbell camera systems such as Nest and Ring are user-friendly and easy to install. These home security systems will allow you to view a live stream of your home from your personal smart phone, so you always know who is knocking at your door. Most doorbell camera systems will notify you when activity is detected, so you’ll know exactly when your item is delivered (even if they don’t ring the doorbell!). Use this function to prevent a package theft by stopping at home to bring your item inside, or even teaming up with neighbors by asking them to hold your package temporarily.

2. Ship to Work or to Friend/Family’s Home

   For some individuals, stopping at home in the middle of the day might not be an option. A great alternative is to have your item shipped to your workplace. Speak to your manager and see what your company policy is- most employers understand that you spend most of your time at work therefore it may be acceptable to receive deliveries there. Sometimes workspace is limited though, so brainstorm people you know that are usually home during the day. Family members who are retired or friends that work from home would be great people to reach out to! The more the merrier when it comes to preventing package theft in our community.

3. Amazon Hub Locker or In-Store Pick Up

   If you are shopping on Amazon, there is now an option to ship packages under 20lbs to an Amazon Hub location. Instead of having your package shipped to a home or business, you can select a “Pickup Point” in your area and have your item shipped to a secured locker kiosk. These Kiosks are located in more than 900 cities and towns across the US! You can use an easy online locator tool to find one near you. They tend to be at neighborhood grocery stores, banks, pharmacy and other easy to access locations. You will receive an email when your item is delivered, and you must pick it up within 3 days of delivery. When you arrive for pick up, just enter your unique pick up code, retrieve your item from the locker, and you are good to go!
   
   Alternatively, if you are shopping at an online retailer other than Amazon, check to see if there is an “in store pick up” option. Insider tip: call the store directly if you do not see a “ship to store” option online. Often times, stores will offer free shipping when you ship to their location!

Online shopping has become a common part of our lives, and its safe to say its here to stay. That being said, porch theft has become all too common as well. Being aware of the risk is the first step to protecting your deliveries. Taking a few moments to consider the above tips may save you from being a part of the staggering porch theft statistic. We hope that these tips were helpful, and wish you have a very happy Holiday season!

On Friday, Nov. 15, 2019, the Trump administration released its final rule regarding hospital price transparency. This final rule will take effect January 1, 2021, a year later than originally proposed.

Hospitals will now be required to provide easily accessible billing information to patients. This means having all standard charges available online and in one single data file that can be “read by other computer systems,” according to a CMS press release.

Learn more here about the final rule released by the Centers for Medicare and Medicaid Services (CMS) regarding hospital price transparency.

Many employee benefits are subject to annual dollar limits that are periodically updated for inflation, such as HSAs, health FSAs, and transportation fringe benefit plans. The IRS recently released Revenue Procedure 2019-44 revising the Health Care FSA and Limited Purpose FSA maximum for 2020. For tax year 2020:

• The dollar limitation for employee salary reductions for contributions to health flexible spending arrangements is $2,750, up $50 from the limit for 2019.
• The monthly limitation for the qualified transportation fringe benefit is $270, as is the monthly limitation for qualified parking, up from $265 for tax year 2019.

The IRS typically announces the dollar limits that will apply for the next calendar year well in advance of the beginning of that year to give employers time to update their plan designs and make sure their plan administration will be consistent with the new limits. Check out our convenient chart with all of the major IRS benefits limits for 2020!

Contact a Knowledge Broker for more information.

Think of this as a friendly alert to double check your personal retirement contribution amounts with your HR or payroll department to ensure you continue contributing at the maximum amount as that limit has increased for 2020.

For business owners, this is great information to share with employees who are maxing out so they can continue fully maximizing their retirement savings potential.

Looking for additional guidance personally or for your employees?  Reach out to R&R Wealth Management with questions: MyKnowledgeAdvisor.com / 262.696.5167.

 

2020 Contribution and Benefit Limits

For 401(k) and other Qualified Plans

Type of Limitation	2020	2019
401(k), 457 and 403(b) maximum annual elective deferral limit	$19,500	$19,000
401(k), 403(b), or 457 plans catch-up contribution limit for individuals aged 50 or over	$6,500	$6,000
Defined contribution plan annual limit	Lesser of: $57,000, or 100% of compensation	Lesser of: $56,000, or 100% of compensation
SIMPLE maximum annual elective deferral limit	$13,500	$13,000
SIMPLE 401(k) or SIMPLE IRA catch-up contribution limit for individuals aged 50 or over	$3,000	$3,000
Traditional IRA contribution limit	Lesser of: $6,000, or 100% of compensation	Lesser of: $6,000, or 100% of compensation
Traditional IRA catch-up contribution limit for individuals aged 50 or over	$1,000	$1,000
Defined Benefit plan annual limit under section 415	$230,000	$225,000
Annual allowable compensation limit for deduction, benefit and contribution purposes	$285,000	$280,000
Highly Compensated Employee	$130,000*	$125,000*
Key Employee/officer in a top heavy plan	$185,000	$180,000
Income subject to Social Security tax	$137,700	$132,900

 

*Applies for determining Highly Compensated Employees for the 2020 plan year.

Limits stated above are subject to the provisions of the plan. Refer to your plan document or contact your plan consultant (TPA) for more information.

The content of this document is for general information only and is believed to be accurate and reliable as of posting date but may be subject to change.

Online retailer Amazon recently announced that you can now use your flexible spending account (FSA) or health savings accounts (HSA) to purchase eligible medical products on its site. Amazon’s FSA and HSA stores enable you to add your respective health payment card to the site and shop for your eligible products as you would shop for any other item.

Some examples of eligible medical expenses include the following:

• Bandages
• Eyeglasses
• Blood glucose monitors

For more information about using your respective health payment card through Amazon, read more here.

An employee’s mental health encompasses how they think, feel and act. It also includes their emotions and social well-being. While mental health does include mental illness, these two are not interchangeable.

1 in 5 U.S. adults experience mental illness annually;

a recent study by Deloitte revealed that less than half receive treatment.

It has also been found that mental illness is the leading cause of disability for adults in the U.S. between the ages of 15 to 44—making more work days lost to mental health-related absenteeism than any other injury or illness.

The discussion of mental health has been more popular in recent years with the tagline of “end the stigma,” this discussion will only keep growing as society realizes that not all illness are visible ones.

So what does this mean for employers?

It is important that organizations create a culture that supports its employees and their mental health. This process is easier than one might think. Below are five easy ways to implement support at your organization:

1. Promote Mental Health Awareness in the Office
   • This is the first step in supporting employees and their mental health. There must be awareness and de-stigmatizing of mental health or illness. Provide resources / information to employees and those seeking support.
2. Offer Flexible Scheduling
   • Help employees better balance their work and personal lives by embracing workplace flexibility. This will look different at every company but provide employees with job satisfaction, better health, increased work-life balance and less stress.
3. Address Workplace Stress
   • Chronic workplace stress can cause fatigue, irritability and health problems. While it’s probably not possible to eliminate job stress in its entirety for employees, you can help them manage it more effectively.
4. Evaluate Your Benefit Offerings
   • Review the benefits you offer and make sure they support mental well-being. Also evaluate your current health plan to see if it covers mental health services.
5. Provide Mental Health Training for Managers
   • It’s important to properly train management in recognizing the signs of mental illness, excessive workplace stress, workplace bullying and fatigue. Furthermore, managers should be trained to handle potentially difficult conversations with employees surrounding mental health.

For more information, you can listen to this short podcast: Mental Health Awareness and Employer Strategies or read 5 Ways HR Can Support Employees’ Mental Health.

Many homeowners avoid installing home security systems because of the cost associated with the installation, monitoring and servicing. The security company charges a monthly fee for monitoring, and false alarms will also incur charges. Is the cost worth it?

Aside from the primary reason (keeping your family safe), you must consider other benefits of a security system, such as the cost of replacing stolen items and broken doors and windows. The peace of mind you have when your family is safe is invaluable.

Together with our from our friends at PropertyCasualty360.com, there are five reasons why a home security system worth the investment.

1. Fire detection
   • Features such as smoke detection provide a timely warning for smoke in the house. Heat detectors can alert you if they sense a source of heat. Heat detectors can establish the presence of a growing fire in your home and provide a timely alert when they detect a small change in temperature. Early detection can help prevent further damage from the fire. Some heat detector will signal the authorities to respond to a fire crisis in your home.
2. Detraction from possible intruders
   • Protecting valuables is the immediate benefit that people enjoy when they install a home security system. You continuously buy, inherit, and collect items that mean a lot to you or cost you a lot of money. The items reflect your values and accomplishment in life, but they are also the target for burglars.  The system alerts authorities of burglary, which increases the chances of catching the criminal. The cameras not only monitor your home but help identify the criminal for the committed crime. The video footage will also help you create a list of items lost during the burglary.
3. Potentially lower home insurance premium
   • While there are many factors that make up the cost of home insurance, many insurance companies provide discounts to property owners who have a home security installed on their premise.  A home security system will also help protect your identity. Some invaders target your identity. Identity theft can occur if an invader if you keep crucial documents at home or forget them in the car. An invader can use the information on these documents and cause you significant financial losses.
4. Protect against carbon monoxide gas
   • Carbon monoxide gas is part of combustion fumes. Burning wood, stoves and other heating systems produce carbon monoxide gas. The gas is colorless, tasteless, and odorless. Thus, the human senses cannot detect the presence of the gas in the air. Prolonged exposure causes the gas to build up in the bloodstream. Large amounts of the gas in the air will cause your body to replace the oxygen in the red blood cells with the gas. The side effects include serious tissue damage, and in severe cases, carbon monoxide poisoning culminates in death. A home security system can incorporate a carbon detector. The detectors will sense high amounts of the poisonous gas in your home and alert you so you can take the right measure.
5. Peace of mind
   • Various security breach situations can disturb your peace of mind. For instance, if you live in an insecure area where burglary can occur at any time, having a home security system is crucial. Peace of mind is essential for the seniors or another person with a disability who frequently remain at home. Such people cannot respond with the necessary speed to a dangerous situation. The security system will monitor your home and dispatch security personnel whenever the need arises. Some security systems also feature a wearable medical alert device for those with specific medical conditions to call for help when a medical situation arises. You can go on a vacation or attend to your job feeling confident and safe.

 

On July 23, 2019, the Internal Revenue Service (IRS) issued Revenue Procedure 2019-29 to index the contribution percentages in 2020 for purposes of determining affordability of an employer’s plan under the Affordable Care Act (ACA). The ACA’s employer shared responsibility or play or pay rules require ALEs (Applicable Large Employers) to offer affordable, minimum value health coverage to their full-time employees (and dependents) or pay a penalty. ALEs are those employers with an average of 50 or more full-time and full-time equivalent employees during the preceding calendar year.

For plan years beginning in 2020, employer-sponsored coverage will be considered affordable if the employee’s required contribution for self-only coverage does not exceed 9.78% of the employee’s household income for the year, for purposes of both the pay or play rules and premium tax credit eligibility.

For more details, read more here. If you have any questions, please contact a KnowledgeBroker today!