ACA Update – Opt-Out Payments

Posted by on Jul 27, 2016 in Benefits Update, News |

As you know, under the ACA employees who have access to ‘affordable’ health insurance from their employer are not eligible for subsidies, and large employers (50+ FTEs) must offer affordable coverage.  This year (2016), affordable means that the employee’s portion of individual health insurance premiums is less than 9.66% of their household income; in 2017 that number rises to 9.69% of income.  What you might not know is that opt-out payments can affect the affordability calculation.  Conditional opt-out payments – you only provide opt-out payments to employees who are not enrolled in your plan but are enrolled in another plan that satisfies the minimum coverage requirements of the ACA – do not affect affordability.  Unconditional opt-out payments – you provide opt-out payments to any eligible employee who decides not to enroll in your plan – DO affect affordability. Here’s an Example Employees who enroll in your health insurance must pay $50/month in premium for individual coverage.  However, you offer an unconditional opt-out of $150/month to eligible employees who decide not to enroll in your coverage. As a result, your employees who enroll in your health insurance are deemed to pay $200/month for the purposes of the affordability calculation.  In this case a full-time employee’s annual pay will need to be at least $24,845 in order for coverage to qualify as affordable.  If you don’t offer the opt-out pay (or it is conditional), your full-time employee only needs to make $6211 a year for coverage to be affordable. As always, please let me know if you have any questions regarding the Affordable Care Act or employee benefits. Elizabeth Ingram Account Manager, Employee Benefits Insurance Trust Phone: 800-287-3379 x 312 info@insurancetrust.us   Sources: http://www.bna.com/irs-proposes-rules-b73014444675/ Broker World, July 2016.  Janet Letourneau’s ‘Affordability Determination, Government Entities, And Benefits Administered By The VA And...

Read More

Member Products: The Key to Loan Portfolio Sustainability and Growth

Posted by on Jul 12, 2016 in News |

Perhaps one of the greatest opportunities that credit unions have to sustain and grow non-interest income today exists with offering ancillary loan protection programs to members. Products like GAP, Vehicle Service Contracts, and Credit Life & Disability insurance help credit unions increase non-interest income, protect members when life interferes with their ability to repay loan obligations and proactively safeguards loans from delinquencies and charge-offs. Most credit union loan portfolios favor auto lending which presents a daily challenge in terms of creating profitable loans in our highly competitive loan rate marketplace. Because lending insurance programs have a strong correlation to the health of credit union lending, insurance agencies like Insurance Trust/CUAlliance play an important role in the success of a credit union. Most credit unions are not, nor should they be, expected to be insurance experts.  That’s why service, training and technical support are important resources to expect of your insurance agency to assist in maintaining effective member programs.  Our goal is to highlight the resources that are presently available through Insurance Trust to aid credit unions with convenience, expertise and support to protect member loans and support portfolio sustainability and growth.   Training Support We are dedicated to providing comprehensive training resources to credit unions through our ongoing Insurance Trust University initiative. Our yearly curriculum includes many different training delivery channels to accommodate the unique needs of all credit unions, including: Traditional Classroom: Product knowledge-specific face-to-face interactive training presentations, customized to accommodate small or large groups. Live Web-Based Training: Monthly webinars hosted by Insurance Trust and our vendor partners, to provide refresher training and new program demonstrations. Recorded Training Library: Access to our library of pre-recorded webinars that are viewable anytime. Semi-Annual Lending School Events: Insurance Trust hosts nationally recognized credit union industry speakers for both Spring and Fall live lending workshops. These events provide best practices to help improve the lending process, sales results and the critical essentials for lending success.   Due Diligence Our agency was created specifically to provide competitive alternatives to member insurance programs that serve the best interest of Maine credit unions.  Insurance Trust is continually performing vendor due diligence to deliver industry-leading member services that yield the greatest overall benefits for credit unions and their members.   In this way, when unexpected things happen with a particular insurance program or carrier, Insurance Trust has competitive options at the ready.   Sharing Back In the spirit of our origins as a trust created by credit unions, we are devoted to continually sharing back in several ways with our partners.  Here are some of the ways we share back: Free Consumer Lending Forms: We pay for 100% of the cost of consumer lending forms for our...

Read More

Trust Tips – GAP to the Rescue

Posted by on Jul 8, 2016 in News, Trust Tips |

A recent real-life GAP claim from one of our credit union clients. Make: Ford Model: F-150 Year: 2006 Mileage: Wicked High (a Maine pick-up truck!) Financed Amount: $18,300 NADA value: $16,075 The truck was totaled just 2 months after it was financed.   The Bad News  The members auto insurance company assessed the value of the vehicle at only $8,700 just 2 months after the NADA was assessed at $16,075.  This resulted in a $9,700 deficiency balance from the amount still owed on the loan.   The Good News  The credit union loan officer convinced the truck owner to place a GAP waiver on this loan agreement and the $9,700 was paid. Plus an extra $1,000 was applied towards this member’s next financed vehicle with that same credit union. Trust Tip Because insurance companies frequently pay settlements that are far less than NADA valuations, the value of the vehicle financed may be much less than what is assumed – particularly without full inspection.  This can especially be the case on older and high mileage vehicles.  Know the risks and explain the benefits of GAP on every loan.  Your credit union and members will be glad you...

Read More

Insurance Trust Supports America’s Credit Union Museum Legacy Campaign

Posted by on Jul 1, 2016 in News |

America’s Credit Union Museum, located in Manchester New Hampshire, is currently more than two years into their three-year legacy campaign with the goal of raising $3.3 million dollars by 2017.  Insurance Trust held its semi-annual lending school at the museum this spring with guest speaker Brett Christensen for staff and management from 27 credit unions representing all six New England states. Our agency was pleased to pledge a gift of $10,000 in support of the campaign. “We believe that the museum’s members, employees and board of directors have an important and purposeful vision for the future of this historical space. We are very excited to participate in the vision of America’s Credit Union Museum as a legacy campaign investor and sustaining member.” – David Baird CEO Insurance Trust The museum is close to reaching its goal which will provide funds for the creation of a new physical and digital credit union industry research center, add additional exhibit space and provide needed renovations to the existing museum building and improve conference facilities to continue serving as a catalyst for the education and growth of credit union professionals. An inspiring passage from the museums website imparts: “The credit union movement continues to grow and succeed thanks to the vision and commitment of its leaders. America’s Credit Union Museum preserves their legacies and inspires each new generation of credit union leaders to reach further.” If you are interested to learn more about the America’s Credit Union Museum legacy campaign, you can visit their website at...

Read More