Benefits and Insurance Considerations in a Changing World

By Jamie Caudill, CFP™, Senior Wealth Advisor and Managing Director, MAI Capital Management LLC

The COVID-19 pandemic has created a seemingly endless list of new challenges for business owners. As the second quarter of 2020 began, many companies were scrambling to manage their business workflows, their IT capabilities, and maintain customer contact, all while making sure their employees were as safe and protected as possible.

As our current year draws to a close, many business owners will consider changes to better protect their business from interruptions, while also managing employee retention and attracting new employees in a competitive environment for talented people.

Many companies were forced to create work from home policies and procedures in 2020. This has led some employers to offer positions as “remote” on a full-time basis. Split scheduling between home and the office has become more popular as well. For some industries, working from home has been an easier transition while in other industries working from home is challenging or just simply not possible.

The impact of the pandemic has been far-reaching, and its long-term consequences are still unknown. Some people who were very sick are now experiencing lengthy recoveries and may never be able to return to their previous jobs. While not all companies offer short-term and long-term disability, a growing number are adding this benefit to their offering. Whether you are an employee or business owner, it makes sense to consider this type of insurance to protect your income. Long Term Care Insurance (LTC) can also provide financial security from a catastrophic health condition. Many LTC policies today combine the benefits of traditional life insurance with the ability to use funds for LTC needs.

The pandemic has also caused individuals to review their coverage or consider life insurance for the first time. Adequate coverage for your outstanding debt and obligations (mortgage, car loans, college education, etc.), as well as for the future needs of your family, are important areas to protect. As an employer, this is another benefit that can be part of a sound employee retention strategy and for attracting new employees. If your employer does not offer this benefit, you can always look into buying your own policy.

Health and wellness programs are another growing area of employee benefits. Many programs provide incentive-driven tasks that promote healthy eating, exercise, and daily movement. Typically, these programs offer a reduction in costs for monthly premiums or cash amounts added to Health Savings Accounts.

Speaking of Health Savings Accounts (HSAs), this is also a good time to explore if your company is offering this benefit. HSAs are typically available to use if your employer has a high-deductible health care plan. With an employer plan, HSA contributions are pre-tax, which reduces your taxable income. Most HSAs today allow you to invest unused balances in accounts that can grow to provide a larger benefit to you in future years. Review your plan and your contribution amount.

The evolving remote workforce and the use of laptops has created some challenges for business owners. Keeping a business’s records and client information safe needs to be a top priority, and the last few years have made this more difficult. Malware attacks, phishing schemes, and ransom attacks are becoming more prevalent. A recent survey suggested that over 50% of small businesses stated that they are not allocating any budget to cybersecurity. Beyond prevention techniques, many businesses are now purchasing insurance for their IT systems, which provides coverage for business outages, security breaches, ransoms, etc. Whether you are a sole-proprietor or a large employer, technology protection should be on your list.

It’s always a good idea for individuals and business owners to meet with their trusted advisors to discuss how they may better protect themselves or their businesses. The last few years should remind everyone to take another look at all aspects of their insurance and workplace benefits as it would be time well spent, so consider making this a priority for your 2022 planning.

Disclosures:

MAI Capital Management, LLC (“MAI”) is a fee-based registered investment adviser and wealth management firm based in Cleveland, with additional offices in Cincinnati, OH, Ponte Vedra Beach and Naples, FL, Nashua, NH, Irvine, CA, Reston, VA, Little Rock, AR, Marriottsville, MD, North Canton, OH, New York City and St. Louis and a presence in Columbus, OH and Miami. MAI’s Cincinnati office is located at 625 Eden Park Drive, Suite 310, Cincinnati, OH 45202. For more information, call 513.579.9400 or visit www.mai.capital.  The opinions and analyses expressed herein are subject to change at any time. Any suggestions contained herein are general, and do not take into account an individual’s or entity’s specific circumstances or applicable governing law, which may vary from jurisdiction to jurisdiction and be subject to change. Distribution hereof does not constitute legal, tax, accounting, investment or other professional advice. Recipients should consult their professional advisors prior to acting on the information set forth herein. In accordance with certain Treasury Regulations, we inform you that any federal tax conclusions set forth in this communication, were not intended or written to be used, and cannot be used by any taxpayer, for the purposes of avoiding penalties that may be imposed by the Internal Revenue Service.

For more information, contact Jamie Caudill at jamie.caudill@mai.capital.

MAI Capital Management LLC is a Goering Center sponsor, and the Goering Center is sharing this content as part of its monthly newsletter, which features member and sponsor articles.