The pupil dilates in darkness and in the end finds light, just as the soul dilates in misfortune and in the end finds God. ~ Victor Hugo, Les Misérables

The Bipartisan Budget Act of 2015

Yesterday the Budget Act of 2015 was signed into law. The link below will give you a summary of want it could mean to you.



The Bipartisan Budget Act of 2015

Puerto Rico: Small Island, Big Debt

Puerto Rico: Small Island, Big Debt

TAKE STEPS TO PROTECT THEMSELVES FROM IDENTITY THEFT

NAIC REMINDS CONSUMERS TO TAKE STEPS TO PROTECT THEMSELVES FROM IDENTITY THEFT FOLLOWING ANTHEM SECURITY BREACH If you have difficulty displaying this article, please click on the link below: http://www.naic.org/Releases/2015_docs/protecting_consumers_after_breach.htm WASHINGTON, D.C. (Feb. 12, 2015) — The National Association of insurance Commissioners (NAIC) is reminding consumers to take extra precautions regarding identity theft protection following a security breach at Anthem, Inc. The Indiana-based health insurer provides coverage for 37 million policyholders. State regulators have learned the cybersecurity hack may have also compromised data of past enrollees, which could mean as many as one in four Americans—80 million people—could be exposed to risk. “Regulators from states affected by the breach are meeting with Anthem executives on a daily basis and consumers can be assured we are asking the company to provide the best possible protection to all current and former policyholders,” said Monica J. Lindeen, NAIC President and Montana Commissioner of Securities and Insurance. “We appreciate the identity protection services being put into place by Anthem, but reviewing the scope and implications of this event will be a long process.” Regulators have called for a multi-state examination of Anthem and its affiliates. The NAIC Cybersecurity (EX) Task Force will monitor these efforts, update best practices and determine whether regulatory action is warranted. Past and present policyholders are urged to find information provided by Anthem here. Anthem has committed to contacting affected policyholders with specific information regarding protective measures. Further information may be provided by your state insurance department here. “We encourage consumers to carefully review financial statements and routinely monitor credit reports from one of the national credit reporting companies,” said North Dakota Insurance Commissioner and Cybersecurity Task Force Chair Adam Hamm. A free credit report is available online at www.annualcreditreport.com.

About the NAIC The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization created and governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally. NAIC members, together with the central resources of the NAIC, form the national system of state-based insurance regulation in the U.S. For more information, visit www.naic.org.

New Legislation Extends Popular Tax Provisions

New Legislation Extends Popular Tax Provisions

Client Alert: New Legislation Extends Popular Tax Provisions

The Tax Increase Prevention Act of 2014 Extends Expired Provisions - December 19, 2014 In one of its final actions, the 113th Congress passed the Tax Increase Prevention Act of 2014. This legislation extends through 2014 a host of popular tax provisions (commonly referred to as "tax extenders"). Client Alert: New Legislation Extends Popular Tax Provisions We'll continue to pass along timely, relevant information.

LIFE INSURANCE KEY TO MOST EXECUTIVE COMPENSATION PLANS

The vast majority of large businesses rely on life insurance to fund key portions of their executive compensation plans, according to a new report.

The latest edition of The Newport Group’s “Executive Benefits: A Survey of Current Trends” found that 73 percent of America’s largest companies—those with $1 billion or more in annual revenue—use company-owned permanent life insurance, or COLI, to fund their non-qualified deferred compensation (NQDC) plans for key executives. Even more—82 percent—use life insurance to fund their supplement executive retirement plans (SERPs).

NQDC plans and SERPs are often used as incentives to attract and retain high-level employees. Among those surveyed, 78 percent said they offer an NQDC plan to executives. Among those who didn’t, 55 percent said they plan to offer one in the next one to two years.

The report shows, when it comes to funding NQDC plans and SERPs, COLI was heavily favored over all other investment vehicles, including mutual funds, bonds and company stock, by the businesses surveyed. Why? Life insurance has several advantages over other investment vehicles when it comes to funding NQDC plans and SERPS, including:

• The inside build-up of cash value occurs tax free, though some employers are subject to the alternative minimum tax (AMT).
• The owner of the life insurance policy—in this case, the company—can make tax-free withdrawals from the policy up to the amount of the owner’s basis. After that, the owner can take a tax-free policy loan, depending on the policy’s contract limitations and charges.
• Life insurance death benefits are income tax-free to the employer (yet still subject to the AMT).

Employers can use the policy’s cash value distributions to pay the employee’s retirement benefits or, upon the employee’s death, the death benefit can be distributed to the employee’s beneficiaries. Cash value distributions or the death benefit can also be used to reimburse the employer for funds paid out to the employee in the form of retirement or disability benefits.

Want to learn more about life insurance and its role in executive benefits packages? Contact Schnack Financial today at 888.734.6575.