The right choice for your dealership GNYADA has partnered with “A” rated insurance carrier AmTrust to offer competitive rates based on individual dealerships’MOD, specific employee classifications, and more. A dividend is also available through this program. Dividend payouts for GNYADA members in the AmTrust Safety Group could be as high as 40%, provided a group loss ratio of 15% or less. Call the Brokerage today to get a quote on your Workers’ Comp coverage (718.746.8100), or visit GNYADA.com/dealers/ insurance/overview to learn more.
How Much Do Workplace Injuries Really Cost a Dealership? Risk management can prepare you for the indirect costs that result from an incident.
• Replacing any vehicle(s) that may have been damaged in the accident. If a customer’s vehicle was damaged, that may add to the cost of offering a loaner vehicle. • Management’s time and effort to handle the incident. Get Risk Management Help The GNYADA Insurance Brokerage strongly recommends dealerships partake in risk management programs. These programs help make employees aware of situations that can lead to accidents. Managers should also be meeting with employees on a regular basis to make sure proper safety precautions are being taken and to promote a safe workplace overall. The Brokerage works with Applied Risk, an independent risk management company which helps assure that all dealership employees do their part to promote jobsite safety. To learn more about risk management techniques and programs, call the GNYADA Insurance Brokerage at 718.746.8100.
When an employee gets injured on the job, the costs incurred by the business as a result are not entirely covered by workers’ compensation insurance. The true cost of a workers’ comp accident has two components: Direct costs are paid by the insurance company to whoever submits the bill. Expenditures can include lost wages, hospital stays, physician bills, rehab costs, prescriptions and other related expenses. Indirect costs are expenses that result from on- the-job accidents, but are not related to an injured employee’s medical coverage. These costs fall to the dealership to pay, and they can reach even higher than the dollar amount that workers’comp covers. Some examples of indirect workers’comp costs include: • Repairing property damage that occurred at the same time as the injury. (Wrecked dealership vehicles, damaged walls or floors, etc.) • Overtime paid to employees who pick up the work of the employee who is out on workers’ comp. • Losses caused by slowed productivity. 1 2
Harry P. Mirijanian, President of Applied Risk Control Corp., contributed to this article.
BROKERAGE BRIEF I N S U R A N C E Is Your Dealership at Risk for an ERISA Violation? Under the Employee Retirement Income Security Act (ERISA), all private sector employers, including dealers, must automatically provide an ERISA Summary Plan Description (SPD) to all participants in the company health plan. It is important to note that while insurance carriers must provide covered employees with what are known as Evidence of Coverage (EOC) certificates, these certificates alone do note meet the ERISA disclosure requirement; only the SPD, provided to employees by their employer, satisfies this. Dealers must provide an SPD to any employee to whom they provide one of the following benefits: • Health, Dental and/or Vision Insurance • Health Flexible Spending Accounts • Accidental Death & Dismemberment Insurance • Group Term Life Insurance • Short Term and Long Term Disability • Severance Policies • Wellness and Employee Assistance Programs If your dealership does not provide SPDs for these products, you are in violation of ERISA and exposed to noncompliance fines. In the past, this has been something the federal government enforced lightly, if at all; however, dealers should be advised that it is now being viewed as a revenue generator.
Prepare for New York’s Paid Family Leave Law New York’s Paid Family Leave Benefits Law (PFLBL) — entitling employees to 12 weeks of paid family leave for certain qualifying reasons — is set to go into effect on January 1, 2018. The policy itself will be funded by employee payroll deductions, and employers will be able to begin taking these deductions on July 1, 2017. (The state will announce the maximum employee contribution rate at that time.) Once payroll deductions are made, dealers will have the option of paying the premium to either a State PFLBL insurance plan or to their DBL insurance carrier. The GNYADA Insurance Brokerage can answer questions about how to make these new Paid Family Leave benefits available to your employees. To discuss your options, call the Brokerage at 718.746.8100.
In egregious cases, ERISA has the power to bring civil actions against violators. Additionally, individual employees can themselves bring action against their employer and be entitled to $147 per day for every day they do not receive these ERISA SPD’s. (Employers offering benefits to 100+ employees must also file Form 5500 [Annual Return/Report of Employee Benefit Plan] with the IRS. This form reports the company’s financial condition, investments and operations.)
If you would like help ensuring that the proper information is being provided to your employees, the GNYADA Insurance Brokerage can connect you with a third- party administrator that has experience with dealerships. These administrators help dealers avoid potential severe federal penalties associated with ERISA noncompliance. Eric Meyerhoff, Regional Sales Director for AMERIFLEX, a third party administrator, contributed to this article.
Michael W. Conway , Executive Director of the GNYADA Insurance Brokerage, is available to discuss your current and future insurance needs. To discuss any of the topics contained in this newsletter, schedule an in-person visit at your dealership, or inquire about insurance issues, Michael can be reached at 718.746.8100 or email@example.com .
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No-Cost Supplemental Plans Enhance Your Employee Benefits Package
Hospital indemnity insurance plans pay cash for covered hospital stays, with optional benefits for diagnostic procedures, surgery, ambulance transportation, etc. Even if an employee has excellent medical insurance, that insurance probably won’t be enough to pay all expenses associated with a hospital stay. Term life insurance offers workers an economical option for providing peace of mind for themselves and their families. These plans can protect loved ones from unpaid debts, secure children’s education, and ensure financial stability in the event of death. 10-year, 20-year, and 30-year term policies available. Supplemental plans help employees prepare for medical events that can create a financial burden to their family. (Benefits are paid directly to the insured, regardless of any other insurance.) Contact the GNYADA Insurance Brokerage for more information.
The cost of providing workers with comprehensive health insurance often becomes difficult for employers to manage. To control costs, many employers offer plans with higher deductibles, copayments and coinsurance. However, these plans raise out-of- pocket costs for employees who may need to keep their healthcare costs low. Voluntary supplemental benefits can help manage healthcare costs in a number of ways. Employees can purchase them on a pretax basis and pay for them through payroll deduction, meaning employers can offer them at no cost to the company. Examples of supplemental plans: Critical illness plans cover incidents such as heart disease, stroke, cancer and kidney disease, and can offer lump sum benefits upon diagnosis and/or specific payments for treatments like radiation, physical therapy, rehabilitation, etc. Short-termdisability insurance has tremendous value.There is a 1-in-3 chance that an employee will suffer some form of disabling illness or injury, or undergo a surgery that could sideline them for three months or more. Many employees have concerns about paying their bills if they were out of work this length of time, making short-term disability insurance an attractive option. Accident insurance is another valuable benefit. Costs associated with an accident could include: emergency room treatment, hospital admission, x-rays, etc.
The Association thanks Benefits Consultant, Sharon Davis, for contributing to this article.
Helping Workers Offset Healthcare Costs Can Benefit Dealerships
HRAs are strictly employer-funded. They can be used to reimburse the same expenses as a health FSA, or they can be restricted to only reimburse specific items, like prescriptions. HRAs are also more flexible; many employers use them to help complement their group’s medical plan. For instance, some employers who offer a high deductible health plan may also implement an HRA that reimburses some or all of the deductible. Since high deductible plans are typically lower in premium, compared to traditional health plans, they can be more appealing to some employees; however, the deductible can be a burdensome expense for enrollees. Absorbing some of that cost through an HRA allows an employer to reduce the financial impact employees potentially face. Employer contributions to an HRA are tax-deductible, helping reduce company costs while providing an enhanced benefit to employees. If you are considering these FSA or HSA plans, the GNYADA Insurance Brokerage can connect you with Third Party Administrators (TPAs) who provide these programs for dealerships.
As costs increase, dealerships can make themselves more attractive as employers by offering insurance plans that can offset those expenses. Flexible Spending Accounts (FSAs) and Health Reimbursement healthcare
Arrangements (HRAs) are two options that can be included in employee benefits packages, and both can represent savings for the employee and the employer. FSAs —also known as Section 125 plans—allow employees to set aside pretax money to cover many out-of-pocket medical, dental, vision and dependent daycare expenses. Each type of FSA that employees can enroll in, including Medical Expense and Health Premium FSAs, are governed by IRS guidelines. Employees generally save an average of 30% on medical expenses by using this pretax account, and employers receive the matching FICA savings.
GNYADA thanks Kathryn Alfaro and John Puglisi from the P & A Group for contributing to this article.
718.746.5900 / WWW.GNYADA.COM
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BROKERAGE BRIEF I NS U R ANC E
Long-Term Care Risks and Solutions Americans are reaching senior-citizenship at the rate of 10,000 people a day. With life expectancies elongating year by year, many of these “fresh seniors” also have living parents. This has stirred a great amount of interest in long-term care insurance, whichmany employers are now adding to their suite of available insurance products. Caring for elderly relatives creates emotional and financial strains on families. It can take a spouse out of thework force and lower family income, and it adds new care expenses that may not have been planned for. These expenses are often in addition to coverage that may be provided by Medicaid, which can leave limited facility options and fail to cover all care costs. Planning for this eventuality should be done before you or a parent require long- term care services. This can be anything from allocating savings for the future costs of home health care or nursing home care, or finding and working with an insurer that provides LTC policies.
Long-Term Care (LTC) policies — depending on the benefits provided — are considerably less expensive than the out-of-pocket cost of care. Now, there are alternatives to standalone LTC policies. Many Life Insurance policies now provide additional LTC benefits or allow the insured to have early access death benefits, to ease LTC costs. To learn about ways in which you can help your family and your employees prepare for the pressure of administering long-term care, ask the GNYADA Insurance Brokerage about affordable insurance plans that will work for you.
Steve Quirk, AssistantVice President - FNA Group, contributed to this article.
Disability Coverage through GNYADA & ARCH Insurance Dealerships commonly offer disability programs to their employees to cover New York State’s “Statutory DBL Benefits”. These benefits provide 50% of average weekly wages up to a maximum of $170 per week for 26 weeks (and not beyond), after a 7-day elimination period. That $17O weekly maximum is taxable. This equates to $736.67 a month for an individual on disability, which fails to meet all the incurred expenses (doctor visits, prescriptions, etc.), particularly in a high-cost-of-living area like NewYork. GNYADA Has a Solution The GNYADA Insurance Brokerage now offers an enhanced DBL program through ARCH Insurance, an A+ rated company. Area dealerships can provide: • A benefit of either 50% of average weekly wages for 26 weeks or 60% for 52 weeks. • A choice of maximum weekly benefit: $170, $255, $340, $425, $510, $680 or $850 per week. The goal of this new offering is to present dealership employees with much needed security in the event of a disabling injury or illness. To learn more, contact the Brokerage at 718.746.8100.
GNYADA’s Brokerage Brief is published by the GNYADA Insurance Brokerage, a division of GNYADA. The Association is located at 18-10 Whitestone Expressway, Whitestone, NY 11357.