Edlund & Associates

Tax time is almost here, and of course you want to take advantage of every possible deduction you can qualify for.

If you are an eligible self-employed individual, or an S corporation shareholder, you can use the self-employed health insurance deduction to reduce your tax liability. Any premiums that you paid for health insurance covering yourself, your spouse and your dependents will generally qualify for such a deduction.

If you have a child under the age of 27 and paid premiums for their healthcare as well, these will qualify even if the child is not the taxpayer’s dependent.

The insurance plan must be set up under the taxpayer’s business. You cannot be eligible to participate in an employer’ sponsored health plan.

If you take the time to look over your homeowner’s insurance policy, you may notice that it includes coverage for loss from identity theft. This is one of the most popular and requested homeowners’ endorsements, for good reason – because identity theft is the fastest-growing consumer crime in the country.

Many statistics exist which establish that identity theft is on the rise. A study by the Bureau of Justice Studies in 2010 found that between 2005-2007, there was a 23% increase of this activity. In 2008, there was another 22% rise in incidents over the previous year. And by 2009, the number of adults affected by identity theft was a record 11.1 million – for a total fraud amount of $54 billion. The average victim spends 21 hours and $373 out of pocket resolving the crime.

You may hear a lot about identity theft online, through fraudulent emails and phishing schemes. However, stolen wallets and documents actually account for 43% of all identity theft, while online methods accounted for only 11%. And 13% of identity fraud crimes were committed by someone the victim knew.

Insurance coverage of this type protects policyholders from losses due to the theft, such as costs associated with repairing your identity, including attorney fees, loan application fees and lost wages. This endorsement is typically a very small addition to your policy premium, and helps give peace of mind.

Even though your auto insurance premium is determined by your insurance company, there are things you can do to keep it as low as possible: 

 Drive safely.  There can be a huge difference in insurance rates for drivers who have tickets or violations on their records. And they factor into your premium for years, so be mindful of this when on the road. Staying within the posted speed and careful driving can save you premium dollars as well as expensive tickets.

 Mileage.  If you increase the number of miles you drive on a regular basis, your car insurance rates will go higher. Car pooling with other workers or taking public transportation can help you control premium costs as well as the cost of gas and parking.

Review your coverage. Do you have the correct coverage on your policy? Request a policy review to make sure you know what you have, and that it makes sense for you and your family. Lowering coverage isn’t a good way to reduce costs, because it could be disastrous in the event of an accident. But raising your deductible is an easy way to save money on premiums.

Shop around. Staying with one insurer for a long time may result in your premiums being higher than the competition. Competition is fierce in the auto insurance market, and rates change regularly. Every insurance company out there is working to find new discounts or policy packages to attract new customers.

Because of this, rates can fluctuate a great deal within a single year. By shopping the competition, you get an idea of how your current premium compares. You don’t have to wait until your current policy expires to get this information. In fact, shopping early can add discounts to your quote.

The holiday season was recently over. You may have spent too much on electronics, toys or other gifts. But the greatest gifts you can give your children don’t come in a gift box.  They involve your spending a little time assuring their quality of life.

Did you manage your finances to give any of these gifts?

1.      Make a Will. Designate who you want to be your childrens’  guardian if you die. Otherwise, the court makes this decision. Do you trust the court to do the right thing?  Putting your choice of guardian in writing is a huge gift that could make all the difference in the world.

2.      Buy Life Insurance. Provide for your children, their living expenses and education in the event of your early death. Term life insurance is very reasonably priced; in fact, premiums have been dropping for years due to greater life expectancies. If you can’t afford a large policy, get a smaller one to start. You can add to it as you earn higher income and can purchase more.

3.      Get an Advance Directive. Putting your family through this wrenching decision should you be incapacitated can be heartbreaking. A living will lets you make the call on whether you want medical care or end-of-life measures under this circumstance.

4.      Update Beneficiary Designations. Despite what you put in your will, the person listed on your life insurance, annuities, retirement and other accounts is the one who will inherit that money upon your death.  If you have divorced, had more children, or other life change, review these designations so that you give the money to the beneficiaries of your choice.

5.      Organize Your Records. Where are your will, your advance directive, power of attorney, your life insurance policy, and financial records? Take the burden off your heirs by getting your documents in order. Let family members know where this information can be found. Also list your attorney, accountant and investment planner’s names, as well as computer and other important passwords.

6.      Purchase Long Term Care Insurance. Most children cannot pay for their parents care in the event there is a need for you to go to a nursing home. The wealthy can afford this expense, and the poor will be covered by Medicaid.  If you fall into the middle, look into getting a long term care plan at an affordable expense.

Usually people know that they need insurance, and make the purchase, but they don’t want to make a claim .

Every golfer would like to cash in on this policy!

At the Lake Merced Golf Club near San Francisco, members pay into an “insurance” pool which pays out when they hit a hole-in-one and then have to pay for a celebratory round of drinks at the club bar. Should they need the funds to pay for the drinks, the insurance pays out to the lucky golfer.

The original article on this type of insurance appeared in Daily Finance.

It’s a given that businesses need to have insurance, but many small business owners find it confusing and frustrating trying to understand the many kinds of coverage and what is right for them.

Property insurance protects against financial losses due to destruction or damage to the location of the business and its contents. Casualty insurance protects the business itself. Income interruption due to a loss, terrorism coverage, and employee dishonesty are some examples.

Liability insurance also has many faces. General liability, Professional Liability, Employers Liability and Directors and Officers Liability insurance are some of the types available. Figuring it all out could be a headache. A good agent will go over your individual needs.

Fortunately, many insurance companies offer packages for small business (Business Owner’s Policy or BOP) and they are often customized for particular industries. In this way, insurance can be offered to a business owner that includes common coverages needed for their business type and risk. Insuring commercial automobiles and Workers Compensation with those same companies often results in lower premiums due to multi-policy discounts.

Get a quote for business insurance by contacting us at (410)977-2915 or email us at cedlund@mdinsurancepro.com.

A major advantage of purchasing life insurance is that it can be easily and effectively used for estate planning purposes. Upon the death of the insured, payment is made to the beneficiaries – and the support of those beneficiaries, is a main reason for having life insurance.

But – it can also be used in planning for your estate as well, primarily to avoid taxes which are imposed on inheritance by the federal  and/or state government. How is this done?

-          An irrevocable life insurance trust is set up to which the insured contributes annually (this cannot be cancelled). When the insured dies, his/her beneficiaries will receive the proceeds tax-free.

-          The insured leaves in their will the legally tax-free amount that would go to their heirs. In this way,  between the trust and the will, the beneficiaries receive the same amount they would have gotten before estate taxes.

-          The insured wills the remaining amount of their estate to a charitable organization, such as a church, which is also a tax-free transaction in the eyes of the law.

Will and trust planning, to avoid probate, is best done by attorneys experienced in this field.

Interested in learning more about using life insurance in estate planning? Call our office at 410-871-0577 or email cedlund@mdinsurancepro.com.

Many of us recognize the need for Long Term Care (LTC) protection, especially if we’ve seen a loved one experience the high expenses associated with it in today’s world. It can be financially devastating. The national average for LTC costs are shown below (may vary by region):

-          Home Health Aide $20.27/hour

-          Assisted Living Unit $3,369/month

-          Nursing home semi-private room $71,175/year

-          Nursing home private room $78,840/year

We recognize the need for it, but worry about being able to afford LTC insurance.

Edlund & Associates now has access to a new concept in LTC and life insurance that guarantees your money back while providing you with both Universal Life Insurance and LTC Insurance.

In essence, you can maintain control of your investment no matter what.

-          If you Live – you receive Long Term Care Benefits, with no waiting period, for as long as you need it

-          If you Die – your beneficiaries receive the face amount of the life insurance

-          If you Quit – you receive your money back, guaranteed

As an illustration, below is an example of program benefits made available to a non-smoking 58 year old female who is a resident of Maryland.  The application process requires a few simple prescreening questions and a 45 minute phone interview – no exams, labs or doctor statements!

-          Premium Received: $100,000 (single premium received on policy effective date)

-          Total Long Term Care Benefit Limit: $529,359

-          Specified Amount of Death Benefit: $176,453

-          Guaranteed Surrender Value: $100,000

To participate, you need to use non-qualified assets in the amount of $100,000 (no 401K or IRA funds) and be under the age of 80.  To find out more about how this program works and the specific benefits that could be available to you, please contact our agency at 410-871-0577 or email us at cedlund@mdinsurancepro.com.

A new concept for life insurance – a policy that guarantees to pay your premium for you if you become unemployed or disabled. Prudential Life Insurance Company, one of our key carriers, is offering this new product which might be perfect for you and your family.  It offers peace of mind and continued protection despite challenges that you could face in life.

Called PruTerm WorkLife 65, this policy is designed for individuals between the ages of 25 and 65. With an unemployment rate hovering around 9% and statistics reflecting that 3 of every 10 individuals will become disabled sometime during their lives, PruTerm WorkLife 65 offers some unique benefits that could be important to you- and it’s very affordable!

Young adults between the ages of 25 and 35 may especially be interested in this product as their coverage extends to age 65 and is not limited to a term of 15, 20 or 30 years which is typical throughout the life insurance industry.

Contact us at cedlund@mdinsurancepro.com or call (410) 871-0577 to get more information and details on this and other life insurance plans.