does it need 3% compound inflation and 30 da elimination period?the minimum amount of coverage someone should purchase if they want to opt-out of the Washington LTC Trust Act is:
$100 daily benefit
$36,500 lifetime maximum
3% compound inflation growth with no cap
30 day elimination period
Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
so what is the minimum requirement when looking for LTCi? one of the agent I talked to mentioned this:
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
In terms of opting out there are no requirements other than it be classified as a LTC plan (as defined in RCW 48.83.020). There was some early talk that the ESD rules would require a plan that offers at least the same benefits as the State's, but those didn't materialize so any valid LTCi plan will work.chupapa wrote: ↑Sun May 23, 2021 3:56 pm so what is the minimum requirement when looking for LTCi? one of the agent I talked to mentioned this:
does it need 3% compound inflation and 30 da elimination period?the minimum amount of coverage someone should purchase if they want to opt-out of the Washington LTC Trust Act is:
$100 daily benefit
$36,500 lifetime maximum
3% compound inflation growth with no cap
30 day elimination period
- willthrill81
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Correct. Right now, any LTC plan as defined in the referenced statute qualifies for the opt out.definitelynotMike wrote: ↑Mon May 24, 2021 12:09 pmIn terms of opting out there are no requirements other than it be classified as a LTC plan (as defined in RCW 48.83.020). There was some early talk that the ESD rules would require a plan that offers at least the same benefits as the State's, but those didn't materialize so any valid LTCi plan will work.chupapa wrote: ↑Sun May 23, 2021 3:56 pm so what is the minimum requirement when looking for LTCi? one of the agent I talked to mentioned this:
does it need 3% compound inflation and 30 da elimination period?the minimum amount of coverage someone should purchase if they want to opt-out of the Washington LTC Trust Act is:
$100 daily benefit
$36,500 lifetime maximum
3% compound inflation growth with no cap
30 day elimination period
The Sensible Steward
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
when people say it's permanent opt out, so they won't come back and check again? like when you change the job later or something you have to proof every year that you still have the policy
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
They will give you some sort of certificate/record saying you're opted out, which you present to future employers. There is no funding for the ESD to do ongoing verification years in future.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
If nothing else it has forced people to consider it...but I'm too young.Soon2BXProgrammer wrote: ↑Sat May 22, 2021 11:20 amThe flip side is.. maybe its a reasonable decision to buy a small but reasonable policy that is decent but less than the tax. (Such as one with $100 day benefit for 2 years but with a 2% compound inflation adjustor)
As rates vary by age, rule of thumb I've seen is around 50 years old is the optimal balance between premium, and years of payments.
However, the one advantage of the WA plan is you stop paying when you stop getting a W2, while private plans you pay until death.
If you're low income, and a little more than 10 years from retirement (the vestment duration), it would probably make a lot of sense to just take the WA plan, but you also have to spend your retirement year in WA.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
For simplified issue, they checks seem to be mostly automated. If it's less expensive to create the policy (especially for the bulk plans that large employers are setting up), with a strong incentive for people to sign for these due to the impending deadline and hassle of a traditional policy, and these policies will be cancelled next year - the insurance company may be turning a profit. I hope they do, at least; they're providing a public service.prd1982 wrote: ↑Fri May 21, 2021 8:33 pmSo back to my question. Why would an insurance company write a policy they expect to be canceled in a couple of months? It has got to cost them and the agent more than the premiums.willthrill81 wrote: ↑Fri May 21, 2021 8:09 pmAs long as you have proof that you were covered by a policy on 11/1/2021, the law is clear that you qualify for the permanent opt out. This is a legitimate, legal loophole, and the ESD cannot 'close it' afterward; only the legislature could, but I don't think that even they could do it retroactively.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Agree, I think this is a massive windfall for the LTCI companies.Whakamole wrote: ↑Mon May 24, 2021 3:39 pm For simplified issue, they checks seem to be mostly automated. If it's less expensive to create the policy (especially for the bulk plans that large employers are setting up), with a strong incentive for people to sign for these due to the impending deadline and hassle of a traditional policy, and these policies will be cancelled next year - the insurance company may be turning a profit. I hope they do, at least; they're providing a public service.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
WoW2012- hoping you can chime in on a couple questions re: LTCi policies.
1. If one has a policy, can they cancel anytime by simply not paying their premium? Or is there a process to go through?
2. As follow-up to question #1, is there a penalty fee to cancel?
3. When one applies for LTCi, can they request it start on a specific future date that might be past when it takes to underwrite and approve. For example, apply in June, get approval in September, but request it take effect on Oct 31?
Thank you in advance for your help!
1. If one has a policy, can they cancel anytime by simply not paying their premium? Or is there a process to go through?
2. As follow-up to question #1, is there a penalty fee to cancel?
3. When one applies for LTCi, can they request it start on a specific future date that might be past when it takes to underwrite and approve. For example, apply in June, get approval in September, but request it take effect on Oct 31?
Thank you in advance for your help!
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
These are excellent questions to ask your agent before you sign up.Kookaburra wrote: ↑Tue May 25, 2021 10:11 am WoW2012- hoping you can chime in on a couple questions re: LTCi policies.
1. If one has a policy, can they cancel anytime by simply not paying their premium? Or is there a process to go through?
2. As follow-up to question #1, is there a penalty fee to cancel?
3. When one applies for LTCi, can they request it start on a specific future date that might be past when it takes to underwrite and approve. For example, apply in June, get approval in September, but request it take effect on Oct 31?
Thank you in advance for your help!
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I didn't see this mentioned in the thread so far: I work for a late stage pre-IPO tech company that I expect to IPO within the next two years. The tax hit from this one-time windfall of W-2 income may range from $50k to $200k for me, which makes opting-out of the LTCi wage tax an obvious choice.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I read the whole thread and found that this is the list of companies selling LTC in WA, thanks to WoW2012
Bankers Life & Casualty
Federal Long-Term Care Insurance Program (for federal employees and retirees and their spouses)
Genworth (only if you buy directly from the home office, not offered through agents/brokers)
Knights of Columbus (for members of the fraternal organization)
LifeSecure (worksite only)
Mutual of Omaha
National Guardian Life
New York Life
Northwestern Mutual
Thrivent
Transamerica (worksite only)
Should I request a quote on their website or is there a consensus on which one is best. Also does anyone have any recommendation for an agent.
Bankers Life & Casualty
Federal Long-Term Care Insurance Program (for federal employees and retirees and their spouses)
Genworth (only if you buy directly from the home office, not offered through agents/brokers)
Knights of Columbus (for members of the fraternal organization)
LifeSecure (worksite only)
Mutual of Omaha
National Guardian Life
New York Life
Northwestern Mutual
Thrivent
Transamerica (worksite only)
Should I request a quote on their website or is there a consensus on which one is best. Also does anyone have any recommendation for an agent.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Has there been any update from ESD on minimum coverage requirements of a private LTC policy used as a basis for exemption?
How are folks approaching the inflation benefit aspect in terms of obtaining policies simply for exemption? I’ve seen posts with references to 0%, 2%, and 3%. I don’t even know what the State’s program offers as a point of comparison.
How are folks approaching the inflation benefit aspect in terms of obtaining policies simply for exemption? I’ve seen posts with references to 0%, 2%, and 3%. I don’t even know what the State’s program offers as a point of comparison.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I think it depends on whether you plan on keeping the policy or cancelling it after November 1st. If you plan on keeping it, 2% is probably fine since the state plan's benefit will be adjusted for inflation. If you plan on cancelling your policy later this year, then you don't need any inflation adjustment.Kookaburra wrote: ↑Tue Jun 01, 2021 4:24 pm How are folks approaching the inflation benefit aspect in terms of obtaining policies simply for exemption? I’ve seen posts with references to 0%, 2%, and 3%. I don’t even know what the State’s program offers as a point of comparison.
The Sensible Steward
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I plan on cancelling after approval/verification . Doesn’t the possible need for an inflation benefit depend on what the ESD comes back with in terms of minimum criteria for exemption? If they end up requiring a policy at least as good as the state’s program, then having 0% might not cut it.willthrill81 wrote: ↑Tue Jun 01, 2021 4:29 pmI think it depends on whether you plan on keeping the policy or cancelling it after November 1st. If you plan on keeping it, 2% is probably fine since the state plan's benefit will be adjusted for inflation. If you plan on cancelling your policy later this year, then you don't need any inflation adjustment.Kookaburra wrote: ↑Tue Jun 01, 2021 4:24 pm How are folks approaching the inflation benefit aspect in terms of obtaining policies simply for exemption? I’ve seen posts with references to 0%, 2%, and 3%. I don’t even know what the State’s program offers as a point of comparison.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Do you believe that they will institute minimum criteria shortly before November 1st? At this point, I don't see how they legally can. The law is clear that any LTCi policy qualifies for the opt-out.Kookaburra wrote: ↑Tue Jun 01, 2021 4:41 pmI plan on cancelling after approval/verification . Doesn’t the possible need for an inflation benefit depend on what the ESD comes back with in terms of minimum criteria for exemption? If they end up requiring a policy at least as good as the state’s program, then having 0% might not cut it.willthrill81 wrote: ↑Tue Jun 01, 2021 4:29 pmI think it depends on whether you plan on keeping the policy or cancelling it after November 1st. If you plan on keeping it, 2% is probably fine since the state plan's benefit will be adjusted for inflation. If you plan on cancelling your policy later this year, then you don't need any inflation adjustment.Kookaburra wrote: ↑Tue Jun 01, 2021 4:24 pm How are folks approaching the inflation benefit aspect in terms of obtaining policies simply for exemption? I’ve seen posts with references to 0%, 2%, and 3%. I don’t even know what the State’s program offers as a point of comparison.
The Sensible Steward
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
willthrill81 wrote: ↑Tue Jun 01, 2021 4:46 pmDo you believe that they will institute minimum criteria shortly before November 1st? At this point, I don't see how they legally can. The law is clear that any LTCi policy qualifies for the opt-out.Kookaburra wrote: ↑Tue Jun 01, 2021 4:41 pmI plan on cancelling after approval/verification . Doesn’t the possible need for an inflation benefit depend on what the ESD comes back with in terms of minimum criteria for exemption? If they end up requiring a policy at least as good as the state’s program, then having 0% might not cut it.willthrill81 wrote: ↑Tue Jun 01, 2021 4:29 pmI think it depends on whether you plan on keeping the policy or cancelling it after November 1st. If you plan on keeping it, 2% is probably fine since the state plan's benefit will be adjusted for inflation. If you plan on cancelling your policy later this year, then you don't need any inflation adjustment.Kookaburra wrote: ↑Tue Jun 01, 2021 4:24 pm How are folks approaching the inflation benefit aspect in terms of obtaining policies simply for exemption? I’ve seen posts with references to 0%, 2%, and 3%. I don’t even know what the State’s program offers as a point of comparison.
My understanding is that the Act currently only references RCW 48.83.020 which doesn’t specify criteria. But after having re-read this entire post, it seems the ESD can still “write or change the rules” over the next few months with respect to minimum criteria (inflation adjustment, Elimination period, etc.). Or is that not the case?
Back in April, there were numerous replies about soon-to-be-released update from ESD on minimum criteria. But then I never saw anything come of that. I know the ESD is notoriously slow. So I’m wondering if we are all still in limbo waiting on them, or if people are proceeding assuming that any policy will do, even if coverage isn’t as good as the state’s program?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
In this post is reasoning for why I don't believe that the law allows the ESD to say that a LTCi policy doesn't qualify. The law says that LTCi qualifies and puts no restrictions on it. I don't believe that the ESD can change the legal definition of LTCi down the road.Kookaburra wrote: ↑Tue Jun 01, 2021 4:52 pmwillthrill81 wrote: ↑Tue Jun 01, 2021 4:46 pmDo you believe that they will institute minimum criteria shortly before November 1st? At this point, I don't see how they legally can. The law is clear that any LTCi policy qualifies for the opt-out.Kookaburra wrote: ↑Tue Jun 01, 2021 4:41 pmI plan on cancelling after approval/verification . Doesn’t the possible need for an inflation benefit depend on what the ESD comes back with in terms of minimum criteria for exemption? If they end up requiring a policy at least as good as the state’s program, then having 0% might not cut it.willthrill81 wrote: ↑Tue Jun 01, 2021 4:29 pmI think it depends on whether you plan on keeping the policy or cancelling it after November 1st. If you plan on keeping it, 2% is probably fine since the state plan's benefit will be adjusted for inflation. If you plan on cancelling your policy later this year, then you don't need any inflation adjustment.Kookaburra wrote: ↑Tue Jun 01, 2021 4:24 pm How are folks approaching the inflation benefit aspect in terms of obtaining policies simply for exemption? I’ve seen posts with references to 0%, 2%, and 3%. I don’t even know what the State’s program offers as a point of comparison.
My understanding is that the Act currently only references RCW 48.83.020 which doesn’t specify criteria. But after having re-read this entire post, it seems the ESD can still “write or change the rules” over the next few months with respect to minimum criteria (inflation adjustment, Elimination period, etc.). Or is that not the case?
Back in April, there were numerous replies about soon-to-be-released update from ESD on minimum criteria. But then I never saw anything come of that. I know the ESD is notoriously slow. So I’m wondering if we are all still in limbo waiting on them, or if people are proceeding assuming that any policy will do, even if coverage isn’t as good as the state’s program?
The Sensible Steward
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
My guess is it does not travel with you state to state as you move. Ie, it’s a tax with little benefit. Not to mention that it covers very little needed when the time comes.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Of course they can. Some companies have already stopped accepting applications from anyone under the age of 40.willthrill81 wrote: ↑Fri May 21, 2021 9:11 pm I'm pretty sure that they cannot legally refuse legitimate customers.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
The state's insurance commissioner will allow them to refuse customers for no objective reason?WoW2012 wrote: ↑Tue Jun 01, 2021 10:23 pmOf course they can. Some companies have already stopped accepting applications from anyone under the age of 40.willthrill81 wrote: ↑Fri May 21, 2021 9:11 pm I'm pretty sure that they cannot legally refuse legitimate customers.
The Sensible Steward
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I've read the rules several times, but still have questions about qualifying for benefits under this policy.
At 65 I don't plan to work much longer, not more than 3 three year or so.
It says to qualify you need to have worked for 3 of the last 6 years and contributed to the program.
It also I says that benefits will begin in 2025.
From this I understand that if I work for three years after 1/1/2022 and retire, I should qualify for benefits.
At 65 a qualifying LTC plan to opt out of the state plan would cost me more than the state plan for the three years. I don't plan on buying a LTC because if I do need LTC I plan to sell my house, which is paid for.
So if I work 3 years I at least get this benefit at very reasonable cost.
Am I wrong in my understanding of this?
At 65 I don't plan to work much longer, not more than 3 three year or so.
It says to qualify you need to have worked for 3 of the last 6 years and contributed to the program.
It also I says that benefits will begin in 2025.
From this I understand that if I work for three years after 1/1/2022 and retire, I should qualify for benefits.
At 65 a qualifying LTC plan to opt out of the state plan would cost me more than the state plan for the three years. I don't plan on buying a LTC because if I do need LTC I plan to sell my house, which is paid for.
So if I work 3 years I at least get this benefit at very reasonable cost.
Am I wrong in my understanding of this?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
If you work for three years, and then you retire, you need to use the long term care benefit during the next three years. After that you no longer qualify as paying in three of the last six years. So of you need long term care almost immediately, you might be able to claim a benefit. Otherwise, you need to pay in for the full ten years to qualify for benefits.From this I understand that if I work for three years after 1/1/2022 and retire, I should qualify for benefits.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Age is objective.willthrill81 wrote: ↑Tue Jun 01, 2021 10:39 pmThe state's insurance commissioner will allow them to refuse customers for no objective reason?WoW2012 wrote: ↑Tue Jun 01, 2021 10:23 pmOf course they can. Some companies have already stopped accepting applications from anyone under the age of 40.willthrill81 wrote: ↑Fri May 21, 2021 9:11 pm I'm pretty sure that they cannot legally refuse legitimate customers.
Health is objective.
Choice of benefits is objective.
Yes, the insurance commissioner will allow insurance companies to refuse policies for someone because of their age or their health or because they apply for benefits that do not meet the companies minimum standards. (Nearly every LTC insurance company has already raised the minimum required benefit amounts for new applications for Washington residents).
As an agent I can refuse an applicant based upon subjective reasons or objective reasons.
#BeNiceToYourInsuranceAgent
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
ondarvr wrote: ↑Tue Jun 01, 2021 11:43 pm I've read the rules several times, but still have questions about qualifying for benefits under this policy.
At 65 I don't plan to work much longer, not more than 3 three year or so.
It says to qualify you need to have worked for 3 of the last 6 years and contributed to the program.
It also I says that benefits will begin in 2025.
From this I understand that if I work for three years after 1/1/2022 and retire, I should qualify for benefits.
At 65 a qualifying LTC plan to opt out of the state plan would cost me more than the state plan for the three years. I don't plan on buying a LTC because if I do need LTC I plan to sell my house, which is paid for.
So if I work 3 years I at least get this benefit at very reasonable cost.
Am I wrong in my understanding of this?
Your understanding is wrong.
After you've been retired for 4 years, you will no longer qualify for benefits under the Trust Act because you will no longer be satisfying the "worked 3 of the last 6 years" requirement.
2022 working, not yet covered
2023 working, not yet covered
2024 working, not yet covered
2025 retired but covered since you worked 3 of last 6 years
2026 retired but covered since you worked 3 of last 6 years
2027 retired but covered since you worked 3 of last 6 years
2028 retired but not covered since you have not worked 3 of the last 6 years
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Why would you think that?
Is that the intent of this law?
The law does allow for verification by the ESD separate from the "attestation period".
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Because the law says that those who have a LTCi policy in place on 11/1/2021 qualify for the opt out. I haven't seen anything in the law that says that the policy must be maintained for the opt out to remain in effect. Everything says that the opt out is permanent.WoW2012 wrote: ↑Wed Jun 02, 2021 10:22 amWhy would you think that?
Is that the intent of this law?
The law does allow for verification by the ESD separate from the "attestation period".
The Sensible Steward
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
We'll see.willthrill81 wrote: ↑Wed Jun 02, 2021 10:25 amBecause the law says that those who have a LTCi policy in place on 11/1/2021 qualify for the opt out. I haven't seen anything in the law that says that the policy must be maintained for the opt out to remain in effect. Everything says that the opt out is permanent.WoW2012 wrote: ↑Wed Jun 02, 2021 10:22 amWhy would you think that?
Is that the intent of this law?
The law does allow for verification by the ESD separate from the "attestation period".
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Insurance Agents work for the Insurance company. They are required by their contracts with their companies to protect the company.Kookaburra wrote: ↑Wed Jun 02, 2021 10:47 amWow. And this why the insurance industry has the reputation that it does.
#BeNiceToYourCustomers
The term "agent" means "a person who acts on behalf of another person or group." which means they are an agent of the insurance company. They write insurance that they think is good business for the insurance agency.
Insurance agents are NOT agents of the customer.
This is similar to "registered representative" of a broker/dealer in the investment world.
Last edited by Soon2BXProgrammer on Wed Jun 02, 2021 11:08 am, edited 1 time in total.
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Why, in this case. If you get a job offer at 500K/yr, but then find out they plan to lay you off after a month, I bet you would decline as well.Kookaburra wrote: ↑Wed Jun 02, 2021 10:47 amWow. And this why the insurance industry has the reputation that it does.
#BeNiceToYourCustomers
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
That’s not really the point here. How about #BeNiceToEveryoneSoon2BXProgrammer wrote: ↑Wed Jun 02, 2021 11:07 amInsurance Agents work for the Insurance company. They are required by their contracts with their companies to protect the company.Kookaburra wrote: ↑Wed Jun 02, 2021 10:47 amWow. And this why the insurance industry has the reputation that it does.
#BeNiceToYourCustomers
The term "agent" means "a person who acts on behalf of another person or group." which means they are an agent of the insurance company. They write insurance that they think is good business for the insurance agency.
Insurance agents are NOT agents of the customer.
This is similar to "registered representative" of a broker/dealer in the investment world.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I am not arguing the "be nice" statement. I agree be nice. there is nothing nice or not nice about deciding that someone's risk profile isn't profitable.Kookaburra wrote: ↑Wed Jun 02, 2021 11:17 amThat’s not really the point here. How about #BeNiceToEveryoneSoon2BXProgrammer wrote: ↑Wed Jun 02, 2021 11:07 amInsurance Agents work for the Insurance company. They are required by their contracts with their companies to protect the company.Kookaburra wrote: ↑Wed Jun 02, 2021 10:47 amWow. And this why the insurance industry has the reputation that it does.
#BeNiceToYourCustomers
The term "agent" means "a person who acts on behalf of another person or group." which means they are an agent of the insurance company. They write insurance that they think is good business for the insurance agency.
Insurance agents are NOT agents of the customer.
This is similar to "registered representative" of a broker/dealer in the investment world.
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
As an insurance agent who specializes in long-term care insurance here in Washington, I'm passing out "get out of jail free" cards. Don't be mean to the people who are authorized to give you that card.Kookaburra wrote: ↑Wed Jun 02, 2021 10:47 amWow. And this why the insurance industry has the reputation that it does.
#BeNiceToYourCustomers
Sadly, at least 25% of those who want to opt-out won't be able to because they can't health-qualify for long-term care insurance. Make sure you work with a specialist who knows who will and who won't insure you.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
From my reading of the law, it would have to be changed in order for the ESD to deny the opt out to those have a policy on 11/1/2021 but don't maintain the policy beyond that date. As it is currently written, the law is very clear that those with a LTCi policy on 11/1/2021 are permanently opted out.WoW2012 wrote: ↑Wed Jun 02, 2021 10:36 amWe'll see.willthrill81 wrote: ↑Wed Jun 02, 2021 10:25 amBecause the law says that those who have a LTCi policy in place on 11/1/2021 qualify for the opt out. I haven't seen anything in the law that says that the policy must be maintained for the opt out to remain in effect. Everything says that the opt out is permanent.
The Sensible Steward
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
The law has already been changed 3x.willthrill81 wrote: ↑Wed Jun 02, 2021 11:40 amFrom my reading of the law, it would have to be changed in order for the ESD to deny the opt out to those have a policy on 11/1/2021 but don't maintain the policy beyond that date. As it is currently written, the law is very clear that those with a LTCi policy on 11/1/2021 are permanently opted out.WoW2012 wrote: ↑Wed Jun 02, 2021 10:36 amWe'll see.willthrill81 wrote: ↑Wed Jun 02, 2021 10:25 amBecause the law says that those who have a LTCi policy in place on 11/1/2021 qualify for the opt out. I haven't seen anything in the law that says that the policy must be maintained for the opt out to remain in effect. Everything says that the opt out is permanent.
Stopping tax cheats is a good thing, isn't it?
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
- willthrill81
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Taking advantage of the law as it is written is not cheating or tax evasion.WoW2012 wrote: ↑Wed Jun 02, 2021 12:01 pmThe law has already been changed 3x.willthrill81 wrote: ↑Wed Jun 02, 2021 11:40 amFrom my reading of the law, it would have to be changed in order for the ESD to deny the opt out to those have a policy on 11/1/2021 but don't maintain the policy beyond that date. As it is currently written, the law is very clear that those with a LTCi policy on 11/1/2021 are permanently opted out.WoW2012 wrote: ↑Wed Jun 02, 2021 10:36 amWe'll see.willthrill81 wrote: ↑Wed Jun 02, 2021 10:25 amBecause the law says that those who have a LTCi policy in place on 11/1/2021 qualify for the opt out. I haven't seen anything in the law that says that the policy must be maintained for the opt out to remain in effect. Everything says that the opt out is permanent.
Stopping tax cheats is a good thing, isn't it?
https://klasing-associates.com/tax-evas ... s%E2%80%9D.The Supreme Court in Gregory v. Helvering, 293 U.S. 465 (1935) defined permissible tax avoidance as actions that “reduce, avoid, minimize, or alleviate taxes through wholly legitimate means”.
The Sensible Steward
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I would be interested to understand how selling a policy is giving a “get out of jail free card.” I think you give yourself too much credit.WoW2012 wrote: ↑Wed Jun 02, 2021 11:39 amAs an insurance agent who specializes in long-term care insurance here in Washington, I'm passing out "get out of jail free" cards. Don't be mean to the people who are authorized to give you that card.Kookaburra wrote: ↑Wed Jun 02, 2021 10:47 amWow. And this why the insurance industry has the reputation that it does.
#BeNiceToYourCustomers
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
The state's insurance commissioner would love to have people under 40 pay this tax for as long as they work in the state, whether they plan to stay or not. It's part of the scam.willthrill81 wrote: ↑Tue Jun 01, 2021 10:39 pmThe state's insurance commissioner will allow them to refuse customers for no objective reason?WoW2012 wrote: ↑Tue Jun 01, 2021 10:23 pmOf course they can. Some companies have already stopped accepting applications from anyone under the age of 40.willthrill81 wrote: ↑Fri May 21, 2021 9:11 pm I'm pretty sure that they cannot legally refuse legitimate customers.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Because without an LTCi policy people are in the WaLTCTA tax jail.Kookaburra wrote: ↑Wed Jun 02, 2021 12:44 pm
I would be interested to understand how selling a policy is giving a “get out of jail free card.” I think you give yourself too much credit.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
I am still confused whether we can have the permanent opt out or we will eventually end up having LTCi for as long as until we still work and live in WA. Please correct me if i am wrong, currently any LTCi will be qualify for opt out?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
currently there is no definition for what qualifies as LTCi in the law except, that they call out that life insurance with living benefit riders that don't test for activities of daily living, do NOT count.
You need to assume you need to pay for the LTCi. the state legislature has changed the law multiple times, i wouldn't take the risk of cancelling after a month after the opt out period.
I would buy something that you might consider keeping... Say $100/day, 2 years, with 2% compound inflation. It will probably be less then the tax if your high income, and over the long run the inflation adjuster will keep it worth something. if your young any policy without an inflation adjuster is probably worthless by the time you would make a claim. (unless you picked some crazy face value today, but the issue with that is that its more expensive because they are providing more insurance for when your young, and more then likely you don't need it.. so its providing the biggest real benefit at the wrong time in life).
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
what do you mean by 2 years? mean the policy will valid only 2 years?Soon2BXProgrammer wrote: ↑Thu Jun 03, 2021 12:22 pmcurrently there is no definition for what qualifies as LTCi in the law except, that they call out that life insurance with living benefit riders that don't test for activities of daily living, do NOT count.
You need to assume you need to pay for the LTCi. the state legislature has changed the law multiple times, i wouldn't take the risk of cancelling after a month after the opt out period.
I would buy something that you might consider keeping... Say $100/day, 2 years, with 2% compound inflation. It will probably be less then the tax if your high income, and over the long run the inflation adjuster will keep it worth something. if your young any policy without an inflation adjuster is probably worthless by the time you would make a claim. (unless you picked some crazy face value today, but the issue with that is that its more expensive because they are providing more insurance for when your young, and more then likely you don't need it.. so its providing the biggest real benefit at the wrong time in life).
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
sorry, two years of benefits at $100/day.chupapa wrote: ↑Thu Jun 03, 2021 9:42 pmwhat do you mean by 2 years? mean the policy will valid only 2 years?Soon2BXProgrammer wrote: ↑Thu Jun 03, 2021 12:22 pmcurrently there is no definition for what qualifies as LTCi in the law except, that they call out that life insurance with living benefit riders that don't test for activities of daily living, do NOT count.
You need to assume you need to pay for the LTCi. the state legislature has changed the law multiple times, i wouldn't take the risk of cancelling after a month after the opt out period.
I would buy something that you might consider keeping... Say $100/day, 2 years, with 2% compound inflation. It will probably be less then the tax if your high income, and over the long run the inflation adjuster will keep it worth something. if your young any policy without an inflation adjuster is probably worthless by the time you would make a claim. (unless you picked some crazy face value today, but the issue with that is that its more expensive because they are providing more insurance for when your young, and more then likely you don't need it.. so its providing the biggest real benefit at the wrong time in life).
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
so what happens after 2 years then? you need to renew the policy?Soon2BXProgrammer wrote: ↑Thu Jun 03, 2021 9:55 pmsorry, two years of benefits at $100/day.chupapa wrote: ↑Thu Jun 03, 2021 9:42 pmwhat do you mean by 2 years? mean the policy will valid only 2 years?Soon2BXProgrammer wrote: ↑Thu Jun 03, 2021 12:22 pmcurrently there is no definition for what qualifies as LTCi in the law except, that they call out that life insurance with living benefit riders that don't test for activities of daily living, do NOT count.
You need to assume you need to pay for the LTCi. the state legislature has changed the law multiple times, i wouldn't take the risk of cancelling after a month after the opt out period.
I would buy something that you might consider keeping... Say $100/day, 2 years, with 2% compound inflation. It will probably be less then the tax if your high income, and over the long run the inflation adjuster will keep it worth something. if your young any policy without an inflation adjuster is probably worthless by the time you would make a claim. (unless you picked some crazy face value today, but the issue with that is that its more expensive because they are providing more insurance for when your young, and more then likely you don't need it.. so its providing the biggest real benefit at the wrong time in life).
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
you pay until you use it... but long term care has a limited number of days or years of benefits . (there used to be uncapped benefits, but those policies have mostly disappeared or are too expensive). A lot of people die within two years of needing LTC, another huge chunk dies within 3... but there is a long tail for those that only need it due to memory care, such as my aunt who has been in a facility for a decade+.chupapa wrote: ↑Fri Jun 04, 2021 12:19 amso what happens after 2 years then? you need to renew the policy?Soon2BXProgrammer wrote: ↑Thu Jun 03, 2021 9:55 pmsorry, two years of benefits at $100/day.chupapa wrote: ↑Thu Jun 03, 2021 9:42 pmwhat do you mean by 2 years? mean the policy will valid only 2 years?Soon2BXProgrammer wrote: ↑Thu Jun 03, 2021 12:22 pmcurrently there is no definition for what qualifies as LTCi in the law except, that they call out that life insurance with living benefit riders that don't test for activities of daily living, do NOT count.
You need to assume you need to pay for the LTCi. the state legislature has changed the law multiple times, i wouldn't take the risk of cancelling after a month after the opt out period.
I would buy something that you might consider keeping... Say $100/day, 2 years, with 2% compound inflation. It will probably be less then the tax if your high income, and over the long run the inflation adjuster will keep it worth something. if your young any policy without an inflation adjuster is probably worthless by the time you would make a claim. (unless you picked some crazy face value today, but the issue with that is that its more expensive because they are providing more insurance for when your young, and more then likely you don't need it.. so its providing the biggest real benefit at the wrong time in life).
The WA state plan is basically a $100/day policy that pays for a year, it comes with a "potential' of inflation adjustor if the fund is actuarially sound.
$100/day doesn't cover ltc but its a start, and can help fill in on top of Social Security, etc. we pay $7000/mo for a facility for my aunt. So if you take that fee, subtract her social security, pension, etc, a $100/day policy would go a long way to cover the gap..
When you increase the length of potential payments of a policy it gets more and more expensive. So.. if you want to stay less than the tax, with something that might be useful, some small policy with a compound inflation benefit is the way to do that. it isn't going to cover all potential LTC costs and made planning for ltc a non issue, but it is a middle ground between self insuring and buying an expensive/full featured policy, and the cost could be reasonable.
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
Thank you for this being (healthy 34 year old male), I do not have a group plan with my employer.daave wrote: ↑Thu May 13, 2021 9:52 pm WA DSHS has put together a website, http://www.wacaresfund.wa.gov/private-insurance/, which clarifies:
My employer offers a group plan which does not require a health exam, and with the minimal possible benefit costs $20/month. Seems I should be able to get this for 1-2 months, and for $20-40 total avoid a 0.58% payroll tax for the long term (which would cost me several thousand $/year). I also got quotes from a local agent which were closer to $40/month (healthy 32 year old male).
- Exemptions are permanent, there's no re-attestation each year that you're still covered
- To get an exemption, any LTCI plan as defined under RCW 48.83.020 will do
- You need the coverage by Nov 1 2021 to get an exemption
- You must apply for the exemption between Oct 1 2021 and Dec 31 2021
"PSX will always go up 20%, why invest in anything else?!" -Father-in-law early retired.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
"The initial premium rate is fifty-eight hundredths of one percent of the individual's wages. Beginning January 1, 2024, and biennially thereafter, the premium rate shall be set by the pension funding council at a rate no greater than fifty-eight hundredths of one percent." -- RCW 50B.04.080
I know there is a small panel in charge of making sure this remains solvent that is supposed to review it every 2 years. Could that panel recommend to the lawmakers that the tax needs to be increased (every 2 years)? I read somewhere that analysts thought the tax needed to start at .66% so I'm worried that it will increase in the future despite what is in the RCW. What is stopping that from being revised?
Thanks in advance,
Healthy 45 year-old
I know there is a small panel in charge of making sure this remains solvent that is supposed to review it every 2 years. Could that panel recommend to the lawmakers that the tax needs to be increased (every 2 years)? I read somewhere that analysts thought the tax needed to start at .66% so I'm worried that it will increase in the future despite what is in the RCW. What is stopping that from being revised?
Thanks in advance,
Healthy 45 year-old
Last edited by RoyHobbs9 on Wed Jun 09, 2021 1:29 pm, edited 1 time in total.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
There is no guarantee what the tax will be in the future to keep the program solvent. If you don't want to pay the tax, the best?? option is to get a small LTCi policy. The largest deciding factor is how large is your income.RoyHobbs9 wrote: ↑Wed Jun 09, 2021 1:13 pm "The initial premium rate is fifty-eight hundredths of one percent of the individual's wages. Beginning January 1, 2024, and biennially thereafter, the premium rate shall be set by the pension funding council at a rate no greater than fifty-eight hundredths of one percent." -- RCW 50B.04.080
I know there is a small panel in charge of making sure this remains solvent that is supposed to review it every 2 years. Could that panel recommend to the lawmakers that the tax needs to be increased (every 2 years)? I read somewhere that analysts thought the tax needed to start at .66% so I'm worried that it will increase in the future despite what is in the RCW. What is stopping that from being revised?
Thanks in advance,
Healthy 45 year-old
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit
RoyHobbs9 wrote: ↑Wed Jun 09, 2021 1:13 pm "The initial premium rate is fifty-eight hundredths of one percent of the individual's wages. Beginning January 1, 2024, and biennially thereafter, the premium rate shall be set by the pension funding council at a rate no greater than fifty-eight hundredths of one percent." -- RCW 50B.04.080
I know there is a small panel in charge of making sure this remains solvent that is supposed to review it every 2 years. Could that panel recommend to the lawmakers that the tax needs to be increased (every 2 years)? I read somewhere that analysts thought the tax needed to start at .66% so I'm worried that it will increase in the future despite what is in the RCW. What is stopping that from being revised?
Thanks in advance,
Healthy 45 year-old
Because of the low interest rates caused by COVID, the state's actuary has recommended the "premium" be increased from .58% to .70%.
OR
Pass a law that allows the funds to be invested in equities.
The way the law was first written in 2019, it is more likely that they will lower the benefits or make eligibility stricter, rather than increase the tax.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.