R&R Insurance Blog

Policy ownership is the number one issue when it comes to taxation. Having the policy set up incorrectly could mean the difference between a Tax-Free Death Benefit and a Taxable Death Benefit.

Buy-Sell Agreements
Every business should have a continuation plan, either in the form of a Buy-Sell Agreement or via will. It should specify what would happen with their ownership if they died, were disabled, or wanted to retire. Typically, these agreements are drafted as Cross Purchase Agreements or Entity Purchase Agreements. Most businesses fund these agreements with Insurance, but how that insurance is owned will make a big difference in terms of taxation.

S-Corp vs C-Corp
Whether you own an S-Corporation (LLC) or a C-Corporation, having the insurance owned by that entity could seriously affect the tax treatment of the death claim. Not only do you possibly trigger a 15% Alternative Minimum Tax (AMT) on the death benefit, but you could also be increasing the value of the business at the worst time, your death. Plus, the loss of step-up in basis to the surviving owners could be even more devastating. Allowing us to review those policies, and determine the correct ownership structure can alleviate any worries, and ensure your insurance is set up in the most efficient way.

Personal Policies & Estate Planning
Currently, in 2017, each individual has a lifetime exclusion of $5.49m. Anything over that amount gets taxed at 40%. Keep in mind, this is subject to change and most likely will change going forward. Which is why having a plan that provides flexibility is essential. Even if your estate is not over that exclusion amount, you may still want to consider having your policy owned by an Irrevocable Life Insurance Trust (ILIT). An ILIT will provide creditor protection as well as outline how you want the money handled in the event you pass away and your spouse remarries.

Don’t wait until it’s too late! Contact Pat Driscoll or Tom Driscoll for a complimentary review of your policies.

A 2015 airplane crash killed two men and seriously injured a third during filming of Tom Cruise's upcoming film "American Made".  Whether flying as part of a Hollywood movie production or flying for hobby, this serves as a great reminder not only for aviation consumers but general commercial consumers as well.    

Read full article: Fatal plane crash in Tom Cruise movie leads to insurance fight

Specific to aviation insurance the article  shows why it’s so important to be a “named pilot” and not just meet the open pilot warranty. This provides the protection of insured status at that point without the possibility of an exclusion applying.  

In all types of commercial insurance it’s a good reminder of how important the following points are:  

1. Proper risk transfer agreements (hold harmless, additional insured and waiver of subrogation)
2. Review and confirmation that there is adequate limits of insurance with the company you have entered an agreement with.

Have questions regarding coverage on your insurance policy?  Contact a KnowledgeBroker.

It's a topic no one wants to talk about.  And everyone hopes will never happen to them.  But the reality is that sometimes the unfortunate happens.  Do you know what to do when an accident occurs that results in a death?

Reporting a Fatality

• OSHA - within 8 hours of finding out
  
  • Call local OSHA office
  • Call 24-hour OSHA hotline
  • Report online www.osha.gov
• Department Workforce Development (DWD) - within 24-hours of death
• Insurance carrier - within 24-hours of death

Reporting Considerations

• Contact R&R Insurance
  • We can help facilitate contacting the carrier and DWD
• Who / how will the family be contacted?
• What is the criteria for the carrier?

Investigation

Law enforcement will be involved! The area will be considered a crime scene, and should be treated as such, until they are done with their investigation. Be sure to preserve all areas and equipment as part of the accident.

• Take photos
• Identify witnesses
• Obtain maintenance records for involved machinery / automobiles
• Document contributing factors: weather, road conditions, construction zone, etc.

Other Consderations

• Crisis management
• Death / marriage certificates
• Media involvement
• Other potential claims: psych treatment for those affected
• Jurisdiction (were employees travelling?)

Looking for crisis management assistence? Contact your Knowledge Broker or safety@rrins.com to get the conversation started.

Whether embedding a “health-first” mentality into an employer brand proposition or developing a multi-channel communication system to better deliver health messages to all employees, it is becoming increasingly clear: health is declining, individual attitudes are shifting, and the role of the employer in helping health decision-making is becoming more and more important.

Across all generations there is an opportunity for employers to improve their approach to health care-related technology. Millennials, Gen Xers, and Boomers all cite that an information-based website, including cost and quality information, is the most important thing an employer can do to assist in getting employees to access to the best health care services and programs.

Many workplaces today are generationally more diverse than in the past. Therefore, it is often difficult to determine the best form of communication, what health issues are important, and understand how each generation values the world of work and wellness.

Millennials (Generation Y), 1981 - 2000

• Leading positive health-thinking and behaviors
• Think holistically about health, prioritize stress management and sleep
• Want an innovative wellness program that caters to their needs and aligns with their preferences
• Collaboration with peers via discussion boards, team based competitions, peer to peer challenges, and motivational coaching.
• 73% of this generation says a company’s health and wellness programs makes one employer more attractive over another.

Generation X, 1965 - 1980

• More interested in the program’s voluntary benefits than the health benefits; want incentives for participating
• Like to be provided with online educational resources such as blogs or health libraries
• Work/life balance is a continual complaint

Baby Boomers, 1946-1964

• Larger emphasis on financial wellness than bodily wellness.
• Look for onsite support and need opportunities to ask questions
• Like to research and consume content
• Stuck in their ways
• Workaholics

Learn more about the differences between each generation by downloading my Generational Wellness in the Workplace white paper. Understanding each lifestyle better can help employers leverage employees’ differences as strengths and provide a variation of resources that provide value in different ways.

Questions? Don't hesitate to contact me. 

Did you know that replying to a text message while driving 55mph is like driving blindfolded the length of a football field? Answering a text message takes your eyes off the road for an average of 4.6 seconds - which would be approximately 100 yards.

In 2016, texting while driving became outlawed for all Wisconsin drivers. In addition to the danger you pose to yourself and others, the tickets you may be penalized with are often considered "major violations" by insurance carriers. Which can result in an increase to your insurance premium.

While there are many distractions on the road today, your mobile phone is one of the worst offenders. Take this quiz for the essential facts on distracted driving and your phone.

For more information on your auto insurance, contact a KnowledgeBroker at R&R Insurance.

With the US Open being hosted in our backyard this week and a whirlwind of summer events on the horizon, there are hundreds of ticket sale transactions taking place each day. While technology has made it easier to purchase tickets with the click of a mouse, it has also come with a price. Unfortunately, with increased sales come increased scams. Here are a few tips to help you avoid falling into the trap:

Take Time to Research

The beauty of the internet is the opportunity to read reviews, check ratings, and find out the good and bad experiences others have had with vendors. An easy way to learn more about the legitimacy of a company is to run their name through a quick online search. If the company is in the business of scamming people out of tickets, there’s a good chance others who have been affected have posted about their experience.

Stick With Reliable Sellers

There are a plethora of opportunities to buy tickets directly from other individuals through social media platforms. Though great deals often appear, purchasing tickets from other consumers is risky as it may result in ticket scams and the misuse of your personal information. It’s also important to be wary of electronic tickets. E-tickets can be easily reproduced and scammers will print off as many copies of a certain ticket as possible. All of these tickets will work perfectly when entering the event, but only the first one scanned will be valid - while the rest will be denied entry. 

Closely Examine the Ticket

After your purchase has been made and your ticket arrives, always take a closer look. Does the ticket include the block, row and seat details? Other easy-to-spot signs of a fake ticket include: incorrect event information, low quality paper, blurry text, uneven margins and jagged paper edges.

Don’t let ticket scams take the fun out of your upcoming summer events. Take the extra time to make a conscious ticket buying decision – and enjoy!

To illustrate the benefits of rebalancing an insurance program to strengthen wealth protection and better manage expenses, the following example presents a before-and-after comparison for one of our valued clients.

Dave and Nicole are a couple in their early 50’s, with two grown children and one still at home.  They have four autos, two homes in Oconomowoc, WI along with a boat, a jet ski, a converted school bus used for tailgating and a moped.  Dave is a business owner and Nicole also works for the business.  They recently purchased a rental property in Madison, WI, and will act as property managers each fall when they spend their weekends cheering on the Wisconsin Badger football team. 

As their previous captive agent recently retired without an adequate perpetuation plan in place, their relationship with their insurance provider was non-existent.  This led to a lack of consistent coverage reviews and resulted in some major coverage deficiencies:  unfortunately a recently constructed detached garage, along with their boat and jet ski, were uninsured.  Dave and Nicole significantly reduced their risk exposure while decreasing their total premium 30% by rebalancing their program as follows:

Savings Opportunities:

• Incorporate substantial “prior carrier” discount provided to direct insurance policyholders.
• Combine all policies into one program, with one bill, and save on service fees by paying in full.
• Extend liability from the primary home to the two other locations.

Coverage Improvements:

• Acquire 30% more replacement cost coverage for their primary and secondary homes.
• Add Original Equipment Manufacturer (OEM) parts coverage to their 2016 Mercedes.
• Increase Other Structures coverage in order to fully protect the newly constructed garage.
• Include coverage for both the boat and jet ski, and incorporate them onto their $2,000,000 umbrella.
• Add Identity Theft and Sewer/Drain Backup coverage to their homes.
• Add Full Glass Coverage and increase Rental Reimbursement Coverage on their autos.
• Include Deductible Dividends and Waiver of Deductible program features.

Contact a Private Client Executive, to learn more about properly protecting your most valuable assets.

*Client names have been changed to maintain anonymity.

On May 5, 2017, the Internal Revenue Service (IRS) released Revenue Procedure 2017-37 to announce the inflation-adjusted limits for health savings accounts (HSAs) and high deductible health plans (HDHPs) for 2018. The IRS limits for HSA contributions and HDHP cost-sharing will all increase for 2018. These limits include:

Over the last week the WannaCry ransomware was released and spread to over 200,000 computers in over 100 countries throughout the world. Following WannaCry, a new attack called Adylkuzz has crippled computers over 150,000 computers. Both attacks exploit a vulnerability in the Microsoft operating systems that are no longer being supported, even though Microsoft did release a patch in March to protect against an attack. Also this week, a hacking group called Shadow Brokers posted an internet message saying it would release a new trove of cyber-attack tools next month.

Even if your business was not impacted these attacks they should be sounding loud warning bells in your organization.  Let’s consider the following:

1. How prepared are you for the next attack?  While attacks such as these have been released for years, they are indicative of a drastic increase in Ransomware over the last year.   Do you have a response plan in place?  Are you conducting exercises to measure your response and how effective your plan is? 
   
   
2. Are you running any legacy software that is no longer being supported? Many companies have some version of legacy software to power a portion of their business.   Have you identified vulnerabilities in this software?  How up to date are you in installing patches and updates? Are un-patched computers connected to your network?
   
   
3. Do you have a plan in place if you are no longer able to access third party vendors which your business relies upon?  For example, if you are a manufacturer and rely on a product or material obtained through a third party, what happens to your business if that vendor is not able to fill orders due to a cyber attack?
   
   
4. Are you conducting regular training of employees to identify phishing emails?  We know that malware and viruses are delivered by either clicking on a link in an email or an internet site.  Do you have a corporate culture that makes cyber security a priority for everyone in the organization?

If your emergency response plan hasn’t been updated to incorporate a cyber attack, now is the time for action.  Also, if you have not purchased cyber insurance, the coverage, proactive risk management tools, and response services could be a life line for your business. 

R&R Insurance is proud to congratulate the Arrowhead High School Robotics Team, Cyberhawks Team 706, on their win at the 2017 FIRST Robotics Wisconsin Regional competition. The Cyberhawks took home the Industrial Safety Award for the 2nd consecutive year. Sponsored by Underwriters Laboratories (UL), this award recognizes a team that progresses beyond safety fundamentals by using innovative ways to eliminate or protect against hazards. The UL Safety Advisors focus on the combination of individual and team safety behaviors and safe physical conditions, along with safety outreach to other teams. By winning this award over the 53 other teams, the Cyberhawks demonstrated continued safe practices in all aspects of the team operation.

R&R’s own Scott Brookes acts one of Arrowhead's Lead Robotics Advisors. Scott was recruited by his son two years ago, who saw the need for a Team Safety Advisor. Scott's background in engineering and his experience in the insurance industry enable him to bring safety education and risk management training to the robotics environment. Together, the Cyberhawks are working to become an OSHA compliant organization.

With the help of R&R and Community Insurance Corporation (CIC), Scott educated the Cyberhawks on top ten OSHA industry losses. They identified which of the OSHA industry losses applied to the industrial machine shop setting in which the team works. The Cyberhawks studied information from R&R's Risk Management Center (RMC), which provides detailed training on relevant safety concepts. In addition, Scott implemented training processes for common cause of loss, including Slip Trip & Fall, fall from height, machine usage and guarding, auto fleet safety, lifting/bending, and PPE usage. All of these training techniques educated the team to properly implement and act out correct safety procedures.

R&R uses a very similar approach with businesses when implementing safety procedures. The process of safety training and utilization of resources, such as the RMC, are used to educate employees to enhance the safety culture of their organization.