Thursday, May 29, 2014

NOAA Predicts Near to Below Normal Hurricane Season

The National Oceanic and Atmospheric Administration (NOAA) is predicting a near-normal to below-normal 2014 Atlantic hurricane season.

“The main driver of this year’s outlook is the anticipated development of El Niño this summer. El Niño causes stronger wind shear, which reduces the number and intensity of tropical storms and hurricanes,” says NOAA in a statement after announcing its prediction this morning in New York. “El Niño can also strengthen the trade winds and increase the atmospheric stability across the tropical Atlantic, making it more difficult for cloud systems coming off of Africa to intensify into tropical storms.”

In total, NOAA is calling for 8-13 tropical storms, compared to a 30-year average of 12; 3-6 hurricanes, compared to a 30-year average of six; and 1-2 major hurricanes, compared to a 30-year average of three. NOAA says there’s a 70% likelihood of its prediction for 8-13 storms.



Wednesday, May 28, 2014

Travelers List the Top Risk Concerns for American Businesses

American businesses of various sizes identified medical cost inflation, legal liabilities and technology risks among their top concerns, according to Travelers' newly released annual Business Risk Index.

Travelers polled more than 1,100 business decision-makers to learn what they believe pose the biggest threats to their business--and, perhaps not surprisingly, many of those polled said the risks they identified as their biggest concerns are also the ones their business is least prepared to address.

“While the new Business Risk Index revealed some typical risks for businesses, it also uncovered some uncertainties that are indicative of the times, including medical cost inflation and technology risks,” said Bill Cunningham, Travelers' executive vice president of business insurance. “Many respondents believe their businesses are least prepared to handle these risks. The good news is that many of these risks can be mitigated and there are resources available to help businesses of any size stay protected.”



Wednesday, May 21, 2014

Has Online Shopping for Auto Insurance Peaked?

Shopping over the internet for auto insurance is down for the second year in a row, says a survey by a company that tracks the behavior of consumers with credit history.

The latest TransUnion Auto Insurance Shopping Index reports that shopping rates for auto insurance were down about 3 percent in the 12 months ending Feb 2014 relative to a year earlier. While 15.0 percent of the credit-active population shopped for new auto insurance policies in the 12 months ending Feb 2014, this was down from 15.4 percent for the 12 months ending Feb 2013, according to TransUnion.

“We are finding that despite billions of dollars being spent on advertising each year, the percentage of consumers shopping for auto insurance has been dropping for approximately the last two years,” said Mark McElroy, executive vice president of TransUnion’s insurance business unit. “This places additional pressure on insurance carriers as their pool of potential customers declines.”


Read the full article here!

Tuesday, May 20, 2014

Senn Dunn Insurance Launches Website for Divers Equipment Insurance

Senn Dunn Insurance is pleased to announce the launch of the newly redesigned website,, exclusively for Divers Alert Network (DAN) members. This online portal allows members to obtain a quotation for new dive equipment insurance, renew an existing policy and file a claim for damages.

Thursday, May 15, 2014

5 Extra Years

Kids today are the first generation ever that will not live as long as their parents.
Experts predict this generation of kids will live 5 years less than their parents.
Nike recently implemented a study and devloped "Designed to Move", a program focused on getting children to MOVE!
Below is a short, but powerful video where kids were asked..."What woudl you do if you could live 5 Extra Years?"
"We are designed to move.  Standing still is only moving backwards.  It's time for action."  -Nike

Tuesday, May 13, 2014

6 Steps to Trouble Free Spring Driving

April was National Car Care month and California Low Cost Auto encourages drivers to conduct essential vehicle maintenance to prepare for the spring driving season.

Spring Cleaning: The holidays can lead to a buildup of clutter in your car. Unloading your car removes unnecessary weight and improves gas mileage. Winter wear and tear will also affect the outside of your vehicle. Salt and dirt will collect on the body of your car causing scratches and rust. Selecting additional options at a car wash or paying special attention to the undercarriage will help eliminate these issues.

Prepare for Spring Showers: April showers bring May flowers so check your windshield wipers. Look for cracks or poor contact on your car’s windshield. If the wiper blades skip, streak, split or squeak, they should be replaced immediately. Proper working wipers are crucial during spring downpours for the safety of you and your passengers.


Read more tips!

Monday, May 12, 2014

Employee Benefits Evolution

Take a look at where employee benefits began with a glance at our graphic titled “Three Key Events That Lead to the Evolution of Benefits.” See which events helped to shape the employee benefits evolution in the U.S. You may be surprised by how far back pensions started and relate to how far they have come. Let us know if you have any input in the comments section below!

If your business in located in the U.S. and you have employee benefits questions, contact Senn Dunn today and we will be happy to assist you!

Weighing the Obesity Factor in Workers’ Compensation

Obesity costs U.S. businesses $13 billion a year, according to Reuters. The disease impacts healthcare, workers’ compensation claims costs and outcomes and comorbidities, according to Kevin Glennon, a certified workers’ compensation claims professional and vice president at One Call Care Management.

Glennon and Kate Wolin, associate professor at Loyola University of Chicago’s School of Medicine, presented on the subject at the Risk Management Society conference in Denver last week.

The experts said additional adverse costs associated with obesity include $5 billion more spent on jet fuel than in 1960 and $4 billion more in gas, due to heavier automobile passengers.



Guidance Released on Coordination of Health FSA Carryover with HSAs; FSA Correction Procedures

On March 28, 2014, the Internal Revenue Service (IRS) Office of Chief Counsel released two memoranda that provide guidance on certain administrative issues affecting employers who sponsor health flexible spending arrangements (health FSAs).

Memorandum number 201413005 provides guidance on various issues relating to the $500 health FSA carryover and its effect on employees' health savings account (HSA) eligibility. The memorandum addresses several issues including the transfer of funds from a "general purpose" health FSA to a "limited purpose" health FSA for employees who wish to establish an HSA after participating in a health FSA the prior year.
Memorandum number 201413006 addresses common issues associated with health FSA claim substantiation requirements. Notably, it clarifies that Form W-2 (rather than Form 1099) is the correct form on which to report improper payments to an employee that the employer treats as includible in the employee's income.

Memorandum Number 201413005 - FSA Carryovers and HSA Eligibility
On October 31, 2013, the IRS modified the "use or lose" rule for health FSAs to allow a $500 annual carryover of unused contributions. However, several issues were left unaddressed at that time, including the effect of the carryover on an employee's HSA eligibility. The memorandum includes the following clarifications:
-  An individual who is covered by a general purpose health FSA is not HSA eligible, even if the coverage is solely as the result of a carryover from the prior year. Moreover, an individual covered by a general purpose health FSA solely as the result of a carryover may not contribute to an HSA even for months in the plan year after the health FSA no longer has any amounts available to pay or reimburse medical expenses.
-  However, an individual who elects to enroll in HSA-compatible FSA coverage in the following plan year may elect to have general purpose FSA funds carried over to a limited purpose FSA (i.e., an HSA-compatible FSA) in order to preserve the individual's HSA eligibility for that next plan year. An individual may also elect to decline or waive a carryover for the following year. 
  • Plans may apply the HSA-compatible carryover automatically for an individual who elects coverage in an HDHP for the following plan year.
  • Carryover amounts may not be carried over to a non-health FSA or another type of cafeteria plan benefit.
-  If an individual elects to carry over unused amounts from a general purpose health FSA to a limited-purpose FSA, the carryover amount is available after the general purpose FSA's run-out period.

Memorandum Number 201413006 - Health FSA Correction Procedures
Cafeteria plan rules provide that after an expense for a qualified benefit has been incurred under a health FSA, it must first be substantiated before the expense is reimbursed. For paper reimbursement requests, the substantiation process always occurs before the expense is reimbursed. However, when a health FSA offers participants the use of a debit card, an expense may be incurred and paid via the debit card before it is substantiated (i.e., at the point of service). There are certain limited situations where health FSA claims are automatically substantiated at the point of service (e.g., under the copayment matching system), but in general the rules require employees to substantiate expenses within a reasonable amount of time after the transaction.

FSA Correction Procedures
Cafeteria plans are required to have the following procedures in place in the event employees do not timely substantiate health FSA expenses reimbursed through a debit card:
1.  The debit card must be deactivated until the claim is substantiated or the improper payment recovered (the employee may continue to submit paper claims);
2.  The employer must demand that the employee repay the plan;
3.  If the employee fails to repay plan after the employer's demand per (ii) above, the employer must withhold the amount from the employee's pay, to the full extent allowed by law;
4.  If neither (2) nor (3) above result in full repayment, the employer must apply an offset against properly substantiated claims incurred during the same plan year; and
5.  If neither (2), (3) nor (4) above result in full repayment, the employer may treat the improper payment as it would any other business indebtedness. In other words, it may include the improper payment in the employee's gross income.

The memorandum notes that the above correction procedure for debit cards may be applied to improper payments from a health FSA (e.g., an expense that is later identified as an ineligible expense).

Exhaustion of Correction Methods Required before Expense is Included in Income
The memorandum clarifies that an employer may alter the order of the above correction procedures as long as it does so consistently for all participants. However, the memorandum requires exhaustion of correction procedures (ii) through (iv) above before an employer may apply correction procedure (v) and include the improper payment in the employee's income. The IRS notes that including the improper payment in employees' gross income should be the exception rather than a routine occurrence, and that repeated inclusion in income of improper payments suggests that proper substantiation procedures are not in place or that payments may be a method of cashing out unused FSA amounts.

Corrections Occurring After the End of the Plan Year
The memorandum clarifies that in the event correction procedures (ii) through (iv) were not applied during the plan year in which the improper payment occurred, the employer should report the improper payment as wages on a Form W-2, which are subject to withholding for income tax, FICA and FUTA. Form 1099 should not be used for this purpose.

Next Steps
Employers that sponsor HDHPs and HSA-compatible FSAs should discuss the impact of these memoranda with their FSA vendors and benefit consultants to determine if any plan design changes are desired in light of this latest guidance.

Thursday, May 8, 2014

Study Reveals 2/3 of Drivers are Distracted on the Road

Nearly two-thirds of drivers engage in distractive driving behavior on a daily basis, reveals a new Plymouth Rock Assurance study.

The study, which consists of data surveys of 3,300 consumers, shows that texting and driving is one of the biggest distractive driving habit among drivers. More than half of respondents have witnessed another driver texting with at least one adult passenger in the car, and nearly 40% have witnessed a driver texting with at least one child in the car.

Despite the prevalence of distracted driving behavior, however, between 70 and 80% of respondents, depending on the situation, did nothing after witnessing another driver engage in a distracted driving behavior.

"As a company dedicated to keeping our drivers safe on the road, the results of this study are enough to keep us up at night," stated Gerry Wilson, President and CEO of Plymouth Rock in New Jersey. "However, hope is certainly not lost—the study also revealed that over the last year, the number of drivers polled in New Jersey who park safely before texting has doubled. To us, this trend means we are on the right track toward a cultural shift in driving behavior, not unlike the adoption of seat belts or awareness of the dangers of drinking and driving. We know change is possible, and we intend on doing everything we can to continue to raise awareness about distracted driving," Wilson said.



Monday, May 5, 2014

4 Places You Should Never Swipe Your Debit Card

Breaking news such as the massive data breach at Experian or Target now seems common. Leaving aside the victims of actual fraud, I hear constantly from people who've had to swap out every debit and credit card, or whose cards were unilaterally replaced by their bank. This causes all sorts of problems.

Sometimes it makes you long for the days of cash. While cash is not practical for everything, there are very compelling reasons to consider it or other alternatives instead of those debit cards.

Of course, you also have to watch where you get your cash, too. Criminals are good at installing near-invisible skimmers on ATMs. These steal your card information and then a miniature camera over the keypad steals your PIN. It's everything a thief needs to drain your account.