Navigating Transgender Leave

The societal understanding of what it means for an employer to be truly inclusive of all diversity groups has expanded exponentially since the turn of the 21st century. Employers are increasingly faced with multifaceted Human Resources related topics including cannabis, cybersecurity, sexual harassment, and a push, in many states, for equal opportunity for paid leave. Equal opportunity accommodations do not just vary between male and female employees but also between groups based on race, religion, and gender identity.

Gender identity itself varies extensively, but one concentration is the difference between individuals that identify as either cisgender (the same gender as their sex at birth) or non-cisgender (not the same gender as their sex at birth). The non-cisgender identity includes a wide umbrella of individuals who do not identify or present themselves with the sex they were assigned at birth, including transgender (not the same gender as their sex at birth) and non-binary (neither exclusively female or male) individuals. This particular group of individuals has historically faced major roadblocks in society and until recently, had not experienced inclusion and accommodations in the corporate world. Even with the progress that has been made, there is still a gap in today’s employee benefits environment for anyone deviating from “the norm”.

Fill out the form below for the full white paper, which covers:

  • Unique challenges faced by LGBTQ employees and their employers, including leaves of absence and insurance coverage
  • Terminology and proper usage
  • Protective regulations, including a state-by-state analysis
  • How to expand inclusivity to the LGBTQ population and tips for building a benefits program and culture that accommodates accordingly

 

Syzygy Insurance Co. v. Commissioner of Internal Revenue

What You Should Know

Recently, the Courts ruled that Syzygy Insurance Company (“Syzygy”), a micro captive created by Highland Tank & Manufacturing Co. and its Associates (“HT&A”) did not qualify as an 831(b) micro-captive entity between the years of 2009 and 2011. Federal courts have been especially assertive outlining bad fact patterns for certain captives, as seen in similar case results such as Avrahami v. Commissioner (“Avrahami”) and Reserve Mechanical Corp v. Commissioner (“Reserve”).

Understanding the criteria and results of these court rulings is imperative to ensure that your clients’ captives, or even your own, are appropriately managed and operated.

In this whitepaper, we outline an in-depth analysis of the court case and decision, and provide you with a checklist for ensuring compliance and validity for your captive, no matter its size. Download to learn more about:

  • Circular flow of Funds
  • Arm’s-Length Contract
  • Valid and Binding Policies

and more, so that your captive isn’t the next one getting negative press!

 

Crafting Cell Captives

Cell captives can help companies achieve a range of goals, and their use cases and utilization rates have been increasing in recent years. While moreCell Captive companies are adopting a cell captive structure, that doesn’t make them any less complicated. Accounting guidance and other regulatory factors often prohibit organizations from aligning the financial reporting of their cell captive with the corporate objectives of the entity.

In this whitepaper, co-authored by Karin Landry, Managing Partner of Spring and Josh Partlow, Partner at Johnson Lambert, will walk you through the evolution of cell captive structures, and provide guidance on financial reporting options and how to address GAAP guidance.

Download the white paper to get a brief history of cell captives, understand the different structures available, insight into the decision to consolidate or not, how variable interest entities come into play and more. We’ll use a sample balance sheet to illustrate these concepts.

Download the White Paper: Crafting Cell Captives

 

Verification

 

 

State of the Industry: Cyber Risk & Captives

The threat of a cyber attack seems to increase with each passing day. With every new technology and security measure developed, somehow hackers always seem at least a step ahead. On a personal level, it’s scary – the possibility of a stolen identity or a hacked bank account is enough to keep you awake at night. However at the corporate level, there’s even more at stake: national security, the safety and livelihood of customers and employees, etc.Cyber Risk

We’ve all seen the headlines: Target, Yahoo!, Equifax, Verizon, and the list goes on. These companies made the news because they are large, global organizations with influence. However, it is not the size or scale of the companies that caused them to fall victim to cyber attacks. Gone are the days when tech firms were the only ones who really have to worry about hackers; the threat is very real for all kinds of organizations.

So as cyber attacks continue to grow in both frequency and impact, we wanted to ask our colleagues in Risk Management about their thoughts on cyber risk and insurance. Further, what does the commercial insurance market look like for cyber coverage? It is extensive? Are companies well protected? Are captives being utilized?

Through our proprietary survey and research, we uncovered some surprising insights on cyber risk and insurance. We can’t give it all away, but we can tell you that the commercial market for cyber insurance is new, imperfect and fluctuating, causing gaps in coverage for most organizations, some of which are questioning the validity of such a purchase. This creates an opportunity for captives in the cyber space, but you’ll have to fill out the form below to learn more.

 

Voluntary Benefits: No Longer Voluntary for Employers (A White Paper)

The evolution of voluntary benefits – that is, those made available by employers but typically funded by employees – over the last five to ten years is truly significant. Once considered a burden that just wasn’t sought after enough by employees to be worth the effort, voluntary is now a critical component to many corporate benefits packages. It offers a win-win-win solution for employers, employees and vendors alike. It allows employees access to more customized products and services without the employer needing to shoulder the cost, in a time when rising healthcare costs are already keeping them up at night.Voluntary Benefits

In this white paper, we’ll take a deep dive into this market shift and uncover the advantages of voluntary programs for all stakeholders. We’ll also share tips and best practices for getting started – or maintaining – your voluntary benefits program, as well as point out potential pitfalls of voluntary plans and how to avoid them. We’ll discuss things like plan design, workforce demographics, ERISA, program communications and other factors that come into play.

Whether you’re already offering voluntary benefits or are considering starting, you’ll want to read our advice and guidelines. We’ve been helping clients navigate these tricky waters for years, and have picked up quite a few tricks of the trade along the way! Fill out the form below for your copy of the white paper, “Voluntary Benefits: No Longer Voluntary for Employers.”

 

 

Watch the Webinar: ERISA Considerations for Voluntary Plans

Once a bit of an afterthought, voluntary benefits are now quite mainstream and used as a tool for employers to provide top-notch, competitive benefits to employees while not increasing their costs. At a time when organizations are struggling to battle the rising costs of healthcare while retaining and recruiting top talent, many have recognized the value of a voluntary program in recent years. With such increased popularity, it’s important for employers to understand all the legal ramifications of their offerings.ERISA voluntary benefits

The Employee Retirement Income Act of 1974 (ERISA) is a federal law that outlines standards for certain pension and health plans. ERISA effectively guides what an employer is allowed and prohibited from doing when it comes to establishing, maintaining and publicizing these benefits. When it comes to voluntary plans, its relationship with ERISA is a bit murky:

  • which plans does ERISA apply to?
  • what is the safe harbor policy?
  • what are the consequences of violating ERISA for voluntary?

In this recorded webinar, I explain the answers to these questions and more. Failing compliance when it comes to voluntary and ERISA is likely a misunderstanding that your organization cannot afford, and it’s important to know the legal nuances that exist when talking about ERISA and voluntary benefits vs. other types. With many employers turning to voluntary programs to solve some of their benefits challenges, it’s critical that they are executed within the realms of the law.

Fill out the form below to learn all about this complex topic. I’ll outline key points and info and you’ll be able to listen to real questions asked by your peers.

 

Watch the Webinar: Time for a Captive Checkup?

Most of us stay on top of things like dental cleaning appointments and routine car maintenance without giving it much thought, but we’re afraid a lot of companies aren’t treating their captives the same way. Our team recommends regular “captive check-ups” every few years for a variety of reasons, and have a clear, proven system for taking organizations through this refeasibility process.

Spring Partner and Chief Actuary, Steven Keshner, along with our Senior Actuarial Consultant and property & casualty expert, Peter Johnson, led an educational session on captive optimization through

Captive Optimization

refeasibility studies. With a combined 40 years of experience in the insurance, actuarial and captive industries, the two have a wealth of knowledge to share, and we wouldn’t want you to miss it.

Fill out the form below to view and listen to our webinar, “Time for a Captive Checkup?” which was conducted live in September of 2017. You’ll take away valuable learnings, such as:

  • The importance of refeasibility and the different factors that make it necessary
  • A recommended, step-by-step refeasibility process including suggested strategies, modes of measurement, and how to piece everything together
  • Questions to be answered through your captive check-up
  • Resources for getting started

 

5 Potential Pitfalls of Voluntary Benefits & How to Avoid Them

You already read that Voluntary Benefits Are No Longer Voluntary for Employers. Now it’s time to dig deeper into Voluntary Benefits best practices- program design, what constitutes success when it comes to voluntary benefits and outline tips to prevent an ineffective voluntary program.

The term voluntary benefits was coined long ago when employers fully funded (or significantly subsidized) core benefits and voluntary benefits were an add-on, paid for by the employee through payroll deductions.  As the landscape changed, core benefits evolved to be partially funded by employers and partially funded through payroll deductions. As a result, many benefits became voluntary.

For today’s employees, it’s not as simple as core and voluntary; it’s about choice.  Employees need to balance what limited disposable income they have for all benefits, regardless of what they are labeled. Even still, the concept of core and voluntary resonates with employers as an industry norm, so it’s important to identify ways to avoid common pitfalls of voluntary program implementation:

  1. Think holistically
  2. Don’t forget about ERISA
  3. Consider enrollment options as a critical component in overall design
  4. Remember that education is key
  5. Help employees get the most from their plan

Think Holistically About Voluntary BenefitsVoluntary Benefits Tips

Many employers think offering voluntary benefits is like checking a box – something that can be done quickly and without much deliberation. However, programs without thoughtful preparation are rarely successful in terms of education, enrollment and satisfaction.  Voluntary benefits should be considered an integral part of the overall benefits package.  A strong offering should take into account various factors, including but not limited to:

Current population:

Although a one-size-fits-all approach does not and should not exist, employee demographics can help you pinpoint which products would be most sensible for your collective audience.  Generally speaking,                  those that are starting out in their careers have different priorities than those nearing retirement, and employees falling somewhere in the middle of the spectrum will have their own set of benefits needs as                well.  For example, accident insurance is more popular for families than for singles or empty nesters, while student loan repayment is more relevant for those in their 20’s and 30’s than for older employees.

Current benefit offering:

When considered in tandem, voluntary benefits can serve to protect employees and reduce their risk or perceived risk for various physical or financial troubles.  For example, introducing a high deductible                   health plan offering complementary voluntary products (i.e. hospital indemnity, critical illness, accident insurance) can help decrease the financial burden on employees.

Don’t Forget About ERISA Considerations for Voluntary Benefits

Voluntary Benefits Best PracticesVoluntary benefit programs may or may not be subject to the Employee Retirement Income Security Act of 1974 (ERISA), depending on how they are structured and supported by the employer.  ERISA provides important protections but can also pose constraints for employers and employees.  Assuming you do not want your voluntary programs to be covered under ERISA, you must be careful to manage enrollment and administration separately from your core benefit programs.  If you would like your voluntary plans to be subject to ERISA, then coordinating administration and enrollment will not be problematic; however, understand the potential impacts.  ERISA compliance and your potential fiduciary duties should never be an afterthought.

Consider Enrollment Options as a Critical Component in Overall Design

Our research affirms that employees better understand the offering and have higher enrollment when they participate in group meetings or individual meetings.  In addition, vendor partners are often willing to offer more competitive pricing and waive enrollment requirements if they can meet with employees directly or send them some type of material in the mail.

While some employers welcome the “free” education and enrollment, others are concerned about aggressive selling or having employees using work hours to meet with potential vendors.  If you think of voluntary benefits as part of your holistic offering, then leveraging work hours will be less of an apprehension when voluntary is an element of your complete attraction and retention tool.

The key is to think about the enrollment process as an essential design component of your voluntary program.  Ensure that decisions surrounding enrollment fit with the overall program strategy and make sense for your population.  Providing comprehensive enrollment with core and voluntary may be a best practice for your group.  This allows employees to make coordinated decisions regarding their contributions and programs.  It also enables you to offer complementary plans for optimal plan selection.  While that structure works for some, other employers feel employees have too many decisions to make during annual enrollment and prefer to stagger voluntary enrollment to allow more time for thoughtful decision making. There’s no right or wrong answer – each company and population is different.

Remember that Education is Important

Decision support tools have continued to evolve, providing employees with strong advocacy for traditional plans and voluntary benefits alike.  Although voluntary benefits are designed to be less complex and easier to understand, for some employees the language is new.  Summarizing the program(s) and sharing scenarios to help employees understand the products is often the best way to introduce a new plan.Voluntary Benefits Enrollment

Regardless of who funds the program, as the employer it is important that you educate your employees on the available offering.  Employees should not elect a benefit they do not understand and employers should not offer benefits that are not valued by employees, or that employers themselves cannot explain effectively.  Every dollar spent on voluntary benefits is money your employees are not spending on other necessities like monthly bills, student debt, groceries, emergency savings, or even 401k contributions; make sure they are knowledgeable about what they are buying and ensure that it’s a competitive product in the market.

Education can be facilitated in many ways including traditional employee meetings, brochures, benefit fairs, and onsite sessions with vendors.  At Spring we have also assisted clients with quick videos that provide the highlights of a program and generate interest.  These videos have been well received and employees are able to retain the information from a creative video more easily than a detailed presentation.  Videos are also shareable and can be viewed by family members who may be a critical part of the decision-making process.

Help Employees Make the Most of the Plan

Voluntary Benefits Vendors

After you have implemented a voluntary program and educated your membership it’s important that you continue to monitor the program and assist your employees in optimization.  Sometimes employees forget about the benefits they have available to them and continue to make monthly contributions to plans but they neglect to file claims because they don’t remember what they have elected.  A few simple actions can help your employees make the most of the plan:

  • Send a quarterly newsletter to all employees, or just those enrolled in voluntary benefits. This will give you the opportunity to remind them of the program benefits.  It can also help facilitate changes (i.e. enrolling spouses, children) and provide an opportunity to ask questions.
  • Partner with your vendors. For example, if you have a purchase program in place, they often run specials and send postcard reminders.  Take advantage of those specials!  Perhaps you could run a joint wellness campaign linked to specials on health equipment.  Ask if they would be willing to raffle off something like a treadmill or vacation to align with your wellness strategy.
  • Remind your employees to file claims. Even if you cannot leverage actual data, you can send a reminder at the midpoint of every year for wellness visits with a link to the claim form.  For example, most critical illness and accident plans offer a wellness rider – find out how many employees use that benefit and try to increase that percentage.
  • Ensure the program remains competitive from a pricing and design standpoint. Employees should feel assured that the benefit they’re purchasing through their employer remains is top tier.

Taking the above factors into account will help you establish a voluntary benefit offering that is accessible and relevant to your employees and that is well worth the effort on your part. Today’s workforce has come to expect more than just the basics when it comes to benefits, and voluntary products allow you to diversify your benefits package, keeping you competitive with market standards without any significant cost increase.

However, it is not enough merely to offer voluntary products and services – they need to be the right ones for your population, they need to be communicated effectively, they need to be readily understood, they need to account for regulations like ERISA, they need to be fully utilized and they need to be rolled out in a way that makes sense for your organization. By covering these bases you’ll be able to avoid the most common pitfalls and successfully offer a valued voluntary benefits programs.