Cheap Laptop Insurance

When you think about protecting your laptop, what do you usually think of-A nice cover? Yes! Anti-Virus protection? Of course! Insurance? Umm no, not so much. Who has insurance on a laptop? A smart, informed consumer who wants to get the most out of their investment is who. However, insurance is one of the most needed and essential protectors to ensure that you get all the possible wear out of your laptop. Just think about if your laptop falls or gets stolen, insurance is the route to go. And if you think it’s too expensive or too cumbersome or too anything, you are wrong. Laptop insurance is just a click away.

Getting Started

Getting started on purchasing your insurance is quite simple. First, choose the value of your laptop. Once you do that, you are given a list of possible insurance policies. For example, a lower priced laptop can run you around $6 a month for coverage. In addition, you’ll be protected from accidental damage, theft and even worldwide cover. Even electrical and mechanical issues are covered, so if you’re in the middle of a big project and your computer stops working, you’re covered.

Get a Quote

Once you choose the best policy for your gadget, you can click on “quote” where you will be taken to another site that will give you more detailed information. You fill in your details and you and your laptop could be insured in just a matter of minutes. You’ll have the peace of mind knowing that you’re protected from a wide array of mishap and misfortune.

Top Reasons to Insure

Still not convinced? Here are some more reasons why you need laptop insurance. You can get a multi-gadget discount when you insure two or more items, including phones, iPads and even game consoles. In fact, you can get up to a 30% discount with 4 items. It only takes about 2 minutes from start to finish. When you submit a successful claim, it usually takes around 48 hours for your computer to be replaced. A repair is usually completed within 5 days. No matter where you go in the world, guess what? You’re covered!

Making an Informed Decision

Now, you all have the information you need to make an informed decision to protect you and yours. You have your choice of a wide array of policies, great coverage, and the best thing of all; it’s cheap. It’s simple and easy and keeping your laptop safe will be the furthest thing from your mind. Cheap laptop insurance is within your reach.

Why Renters Insurance? A Story That Explains It All

So you just got out on your own, got out of your parents place and want to prove to the world that you can survive. You’ve saved up enough money to pay for the first and last month’s rent for your apartment, you just put utilities in your name, and filled your fridge and cabinets with all sorts of food you know you will never eat. You bring your big screen TV, your Xbox, your Wii, and every other electronic device you have into your new apartment. You sit back and relax, knowing that you are independent. No longer attached to your parents, you feel really good about yourself. You are finally living every teenagers dream.

You awaken later that night just in time to hear the door slam. You remember hearing voices, but you thought they were part of your dream. Did you imagine the door slamming? You didn’t invite anybody over. What was that noise? You slowly creep to the door of your bedroom and look out towards the living room. Something isn’t quite right. You keep taking small cautious steps towards the living room, and confirm your worst nightmare. All of your stuff is gone. The only item you set up was your bed, the rest of it, was gone. They even took some of your food. Your hands fumble for your phone, the first person you think to call: your dad. He always knows what to do. Your muscle memory quickly kicks in as you realize you didn’t even think about it when you dialed his number. “Hello?” a very quiet voice comes on the phone, a voice you recognize as your dad. He sounds very tired, suddenly you realize its 2:45 in the morning. “Dad,” you whisper, “Somebody stole my stuff.”

A short while later, the police arrive at your apartment. Your dad’s there now, trying to help you prepare a list of everything that’s missing. “I just can’t remember it all,” you snap at your dad as you rack your brain to remember what you had. Even though you sounded angry, you still feel glad your dad is there to help comfort you. The police ask you questions, many of them you feel like you can’t answer. You finally finish your list and hand it the police officer. You know the list is not complete, you forgot half of the stuff that you had. The officer explains to you that there were no signs of forced entry. Your years of watching C.S.I. kick in and you realize that means somebody didn’t have to break in. You tell the officer you remember locking the door. Your dad always taught you to do that. The officer explains that the previous tenants may still have a key, and that you should change the locks. “That advice is a little late don’t you think?” you say angrily to the officer, quickly regretting saying that. You knew it wasn’t his fault. The officer is quick to come back though, “Well, I hope you have renters insurance.”

“Renters insurance?” You asked more politely. “Yeah,” the officer says, “renters insurance covers theft of your personal belongings. I recommend it to people who are renting, did you know that it’s the only way to protect your personal belongings, even if they are in your car? I rent too, and I have renters insurance for my place. It’s only about ten bucks a month.”

“Ten bucks a month.” You say as I looked around the empty room. “You mean I could have all of my stuff replaced from this, and it would only cost me ten bucks a month?”

“Yup,” the officer says reaching for his wallet and pulls out a card, “here, why don’t you talk to my insurance agent. He sells Farmers Insurance, good rates, and he will treat you right. Tell him I sent you. Here is his card.”

“Thanks!” you say with maybe a little too much excitement. “I will call him tomorrow. What are the odds you will find my stuff?”

“Honestly?” The officer asks, “I don’t think we will ever find it. You don’t have a complete list, and there is no way to identify the property as yours even if we do find it. Sorry, but most of these crimes just go unsolved.

Once the officer leaves, your dad asks you if you wanted to come home for the night. You really want to, but you have waited for this moment for so long. You tell your dad you think you will be okay. As your father walks out of your apartment, you turn the lock on your door. You almost laugh as you think how pointless that action was. Somebody out there has complete access to your apartment, you might as well leave it unlocked.

For the rest of the night, you don’t get any sleep. Every little noise in the new apartment startles you. You think of things you forgot to add to the list you gave to the officer.

The next morning you call the agent on the card. While speaking with the agent, he explains what Farmers Insurance does differently from other companies.

“Well,” he says, “We have a feature called Contents Replacement. Basically, if you have a couch now, and something happens to it, you get enough money to buy a new couch of equal or greater value. Without that feature, you would only get about the ‘garage sale’ value of the couch. How would you buy a new couch with only twenty bucks? That may be the value of the couch to an insurance adjuster, but it was a couch to you! You don’t need twenty bucks, you need a couch.”

The agent finishes filling you in on all of the features and low cost of renters insurance, you finally breathe a sigh of relief. “Once I buy a new lock for my apartment, I think I can finally sleep well again.” You think as you read off your credit card number to the agent. “I just wish everything was this simple.”

Types of Property Insurance Coverage

There are Twelve types of Property Insurance coverage

    1. Replacement cost coverage: Replacement cost coverage is the type of property insurance that will always make sure that the cost of your property assurance is being paid regardless of downfall or increasing of currency. Replacement cost coverage is made easy so that property insurance client, spend less money to get new same type of product that the assurance company does not consider to pay.


    1. Explosion Insurance: Explosion allowance coverage is a kind of insurance policy one needs to have, this kind of a insurance is designed to protect and cover the loss of property due to explosion.


    1. Fire Insurance: This is a type of property allowance that basically concentrated to damages caused by a fire. Fire assurance coverage provides the protection for damage caused by a fire into your property.


    1. Aircraft Insurance Coverage: Aircraft allowance coverage is kind of insurance that deals or designed to protect your property in case the Aircraft crush on your property.


    1. Home Insurance: Home provision covers both property and Liability,using single premium which covers for all risks. Home Insurance is also known as multiple line insurance coverage, it covers private homes also bond’s various types of personal Insurance.


    1. Theft Insurance: Theft insurance is the kind of property coverage that covers the damage of the property due to burglary, theft etc.


    1. Riot/Civil commotion: This is a type of property coverage that protect or covers your property from the damage caused by the Riot. It covers the cost caused in violent disturbance caused by four or more people in your property. types of provision include an aspect of liability coverage. For example, a homeowner’s insurance policy will normally include liability coverage which protects the insured in the event of a claim brought by someone who slips and falls on the property; automobile insurance also includes an aspect of liability provision that indemninate against the harm that a crashing car can cause to others’ lives, health, or property.


    1. Volcanic Eruption: Volcanic Eruption is a kind of property provision that covers your property against the explosion caused by Volcanic Eruption.


    1. Hail Insurance: Hail Insurance coverage is a kind of insurance cover that protect your property against losses due from hail.


    1. Hurricanes: Hurricanes Insured coverage is the kind of insurance that is designed to cover or protect your property against the losses caused by hurricane


    1. Flood Insurance: Flood Insurance coverage is a kind of property insurance made to cover your property from the damage caused by floods into your property.


  1. Earthquake Insurance : This is a kind of property allowance that is design to cover the damage that has been caused by an earthquake to your property. Rates differ rates are determined on the location you are situated in. Homes made of wood have cheaper rates than Homes made of brick.

Property Insurance Comes In Many Varieties

Property insurance is a fairly straightforward concept that can become confusing if you don’t know what kind of policies protect against which kinds of perils. In general, if you own property of any kind, it could face damage or destruction or its use could result in damage or destruction to other people’s things, such as a car, truck, van or other vehicles that is wrecked during an accident. In such cases, a good insurance plan will pay to costs to repair or replace the damaged or destroyed items up to policy limits and minus any deductibles that might apply.

Another threat people who own things face include if someone is injured or killed due to some sort of use involving the insured property. That could mean something as simple as a slip and fall while coming or going or could be more serious, such as a permanent disability or worse, death, resulting from the use of the insured item or parcel. And that could leave the owner in serious financial trouble without the right kind of protection in place. Without the proper coverage, it would be possible to lose virtually all assets and even future earnings if facing a lawsuit resulting in a large judgment against the owner.

Fortunately, insurance can reduce the risk of going bankrupt or losing everything due to liability arising from use of an insured item or parcel. Liability of course, is the legal obligation to care for what is owned and ensures others are not harmed or their things damaged while on an insured parcel or other tangible asset, such as a home or car. And when liability coverage is in place, the policy will pay up to its limits for the injuries or damages.

In addition to monetary limits, there are other limitations on such policies. A deductible typically would apply in the event of a total loss or damage to the insured item, home or parcel. A deductible is designed to keep litigation at a minimum and stop the potential for several claims being filed as a result of small incidents that inflict only a small amount of monetary loss to the policyholder. Deductibles might range from zero dollars to $1,000 or more on a car, for example. And possibly even higher for a home or other insured parcel. And if the insured item is harmed, the policyholder must pay for those costs rather than file a claim if they fall within the range of the deductible.

Deductibles do not apply if causing injury or damage to somebody else or their property, which prevents yet more possible lawsuits from being filed and running up costs even more than they already might be. Deductibles are designed to reduce costs for insurers as well as policyholders and can make rates more affordable when purchasing coverage. But having too high of a deductible can be a problem for people who have limited means of income and can result in a short term financial hardship if choosing a $1,000 deductible.

Skip The Warranty

Until recently I had no problems with any warranty I have purchased for a product I’ve bought. I’m sorry to say that has changed. I had a bad business and consumer issue with a company that has changed my views on customer service. Some people are more friendly or helpful than others then there’s the ones who don’t care about helping you resolve your issue.My issue with this company didn’t get resolved.

Anyway here is my rant about a recent phone call to them. Back in 2010 I purchased a laptop through the company and the customer service representative offered me accidental damage insurance. This insurance is to cover any type of accidental damage that may occur to your purchase item such as spilling liquid in your laptop or dropping it and it doesn’t work properly. I have dropped my laptop hundreds of times without any type of damage to it until a few weeks ago. I dropped it on the floor and the metal piece inside the laptop charger port broke off.

I realized I have coverage for that and I picked up the phone to report my issue with the company. After 30 minutes of being on hold off and on, they calmly told me that they couldn’t fix the damage even though I had damage coverage. It made absolutely no sense to me. I asked how this is possible and they explained that my warranty had expired and the accidental insurance was only valid if the warranty was active. The warranty and accidental insurance are two different things. I then told them there was no purpose for the insurance if it isn’t for repair of the laptop. This was not explained to me when I made the purchase. I thought buying this insurance for my laptop covered it for any accidental damage until 2015 with a replacement. Because I let my warranty of the laptop expire the accidental insurance which is still in effect isn’t valid without the warranty.

I paid them $100 for this insurance to find out I can’t do anything with it unless I have the laptop warranty active. I wish the person I had talked to the day I bought my laptop would have made that clear; I could have saved $100. Skip the warranties it’s a waste of money and eventually all your products will break down or an upgraded version will come available.

4 Tips to Ensure That You Are Prepared For Disaster

A disaster can strike at any moment and it can be caused by anything from extreme weather to accidents and other human activities. Your survival during a disaster will largely depend on how prepared you are. While everyone hopes that they are safe at all times, it helps to assume that disasters can and do happen and being emotionally and mentally prepared is essential. There are several tips that can come in handy in case the worst happens.

Avoid panic

While it is normal to be scared, you have to try to keep calm and avoid panicking. Living through the disaster will be stressful, but if you had prepared in advance you can deal with the emergency more effectively. Going through some form of survival training is important but it also helps to learn the facts from a reputable source to avoid unnecessary fear.

Get information

You enhance your chances of survival by getting as much accurate information as you can. Know your limits and specific needs so that you know what you can do. Proper disaster preparedness will help you to have everything you need for your survival. Do not attempt to perform activities that are beyond your abilities. There are specific items that you need and it helps to have a survival plan for your family.

Survival tricks

It helps to learn survival tricks including how to survive on less. Going on camping trips is a good way to learn how to live with less. You should also read survival guides and take the time to learn how to act when you find yourself in different situations. Having a good camping kit in a convenient location will help to make sure that you have all the gear you need to survive during the disaster.

Keep it simple

Most people make the mistake of trying to do too much and in the end, they find that they cannot operate their equipment or salvage anything. It is important to keep it simple when putting together survival gear to make sure that the items will not fall apart under pressure. Testing your equipment will help to ensure that everything is in good working condition.

You need to prepare for the type of disaster that is likely to affect your area. Different places have different needs and you need to plan for your situation. Make sure that you have adequate emergency supplies for any eventuality and be prepared to act by practicing as often as you can. Make sure that you inspect your equipment regularly and rotate items such as foods and medications.

Insurance: A Necessity for Peace of Mind

There are many choices for insurance. Insurance is a
policy where you pay in a certain figure, that you do not
usually get back, and pays out in the event of a certain
situation. The details vary according to the type of

Health insurance was invented to help with your medical
care. You will typically pay in a certain amount every month
called premiums and you may have invest a certain
on your presciptions and doctor’s visits but the insurance
is created to help you with the costs. It will also help
you in emergencies such as a broken bone, accident or a
sudden illness. Insurance is there to benefit you if you are
having a baby or any other time you require regular care.

Car insurance is intended for accidents; either your fault
or someone else’s. You pay on your car insurance premium
every month (or quarterly or yearly) and if you are in an
accident, the insurance can cover damages. There are two
basic kinds of car insurance; liability and full-coverage.
Liability will only cover what you are liable for.
Full-coverage will cover anything that happens to your car,
your body or to the other party in an accident.

The main purpose of life insurance is to cover the survivors
of the person who dies. Life insurance can be used to pay
off debt, cover burial expenses or take care of surviving
children. Life insurance can be very important, especially
if you are leaving a spouse that doesn’t work, young
children, or debts. In the event of your death, the life
insurance company would award the amount of the policy to
your beneficiaries.

As the name implies, home insurance is meant to protect
home and property. There is home owner’s insurance and
renter’s insurance. Renter’s insurance will take care of
personal items that are in the home and most often cover
damages to the house itself if there were a robbery or
similar damage to the property. This will keep the renter
from having to pay the owner personally if damage to the
property occurred as a result of a burglary.

The home owner’s insurance will protect the same things;
damage to personal property and also to the premises.
Many insurance plans cover natural events such as
floods or earthquakes. Some plans cover fire and others do
not. Most cover fire only if it was not set by the owner.

There are many other kinds of coverage that are necessary
for business owners, including disability and business
interruption insurance. The only way to assure proper
coverage is to consult with an agent and one that has your
particular situation in mind.

Alternate Risk Transfer (ART) – Insurance Strategies

Risk Management

Alternate Risk Transfer is a fancy way of saying alternate methods of insurance and risk management, of which there are many. From the most basic alternative of going without insurance (self-insuring) to so-called “program business captives”, there are a wide variety of strategies from which to choose.

To understand why ART strategies are so popular it is important to understand a few facts about insurance pricing.

►Insurance Premiums are related primarily to economic cycles NOT primarily to claims.

“The claims that recent increases in medical malpractice liability insurance premiums in Connecticut are attributable to overly generous jury verdicts are unfounded. The more likely explanation for the sudden rise in rates is the decrease in investment earnings of the medical malpractice insurers…” Professor Tom Baker, Director, Insurance Law Center, University of Connecticut School of Law

Every time insurance industry profits decline sharply, the industry declares an “insurance crisis” – rates go up sharply, deductibles rise and underwriting guidelines tighten.

►Insurance Premiums have risen much faster than claims.

Median medical malpractice payments rose 35 Percent from 1997 to 2001 (an average of 8.5% a year).
Average premiums for single health insurance coverage increased 39 percent over that time period (9.5% per year). (Source: National Practitioner Database)

►A small number of insured may be responsible for a large percentage of losses.

National Practitioners Database:

For example, in Florida, 6% of the doctors were found to be responsible for 51% of the malpractice claims. 2,674 out of 44,747 doctors have paid two or more malpractice payments. These doctors are responsible for 51% of total malpractice payments.

24 Florida physicians have paid 10 or more malpractice settlements since 1990.

Needless to say, the 94% pay for the poor claims experience of the 6%.
ART Strategies

Conventional insurance markets are one-year indemnity contracts designed to transfer specific hazard risks. Typical features of an ART strategy are:

►Multi-year, multi-line coverage

►Coverage tailored to special need of insured

►Provides coverage not generally available in the marketplace

►Risk retention by insured

There is a multifarious trade-off between risk retention, complexity and cost among the various different ART strategies. Not surprisingly, the plans with the least risk, complexity and expense generally provide the least benefit. As more risk is retained, the greater and greater benefits can be obtained. Of course, complexity and administrative expenses grow as well. Windward Harbor can help you find, execute and manage the right strategy for you. We have listed the basic ART strategies below.

►Guaranteed Cost Insurance Plans

Traditional insurance coverage.

►Loss Sensitive Insurance Plans

Insurance coverage for a specific insured where the final premium is based on the insured’s losses.

►Risk Purchasing Groups (RP’s)

Risk Purchasing Groups were created by the Liability Risk Retention Act of 1986. The purpose of the act was to break through the myriad of state insurance regulation in the hopes of making it easier for groups to purchase liability insurance. The act allows groups of individuals combine to purchase liability insurance while prohibiting states (regulators) or insurance companies from discriminating against them.

►Self-Insured Retention Plans (SIRS)

The primary difference between a deductible and a self-insured retention is that a deductible amount counts against the total limits of the policy, reducing total coverage, whereas a self-insured retention plan provides limits of coverage in excess of the self-insured retention so that the amount payable under the policy is not reduced by the amount of the retention.

►Protected Cell Captives (Segregated Portfolio Companies)

PCCs (SPC’s in certain domiciles) are essentially rent-a-captive companies that ensure complete separation among program participants. According to the laws of specific domiciles, PCCs or SPC’s generally guarantee complete separation of each cell’s assets, capital, and surplus from each other. Because they can achieve economies of scale, rent-a-captives make captive insurance affordable for companies that would not otherwise be large enough to profitably own and operate their own captive.
Windward Harbor LLC owns a BVI licensed Segregated Portfolio Company – Windward Harbor SPC Ltd, which provides rent-a-captive services for selected clients on an annual fee basis. Each segregated portfolio has its own economic ownership, tax Id number and files a separate tax return.

►Self-Insured Groups & Pools (SIG’s)

While the concept differs slightly from state to state, SIGs work similarly in the nearly 40 states in which they are legal. A group of employers form a nonprofit corporation or trust and hire a professional to manage it. This new entity then purchases the insurance, meaning the SIG members essentially “own” their own workers’ comp company.

The group pools the money it otherwise would pay an insurer, earning investment income on funds held in reserve. If a SIG program cuts down on workplace injuries and claim costs, the surplus, or “dividend,” from premiums is returned to members.

Of course, if a company or the group as a whole has catastrophic losses, members pay the difference, up to a limit. Above that point, the group buys excess insurance to offset a single large loss or a combination of losses.

►Captives (See Captive Services)

A captive insurance company is an insurance company that is owned and controlled by its insureds. According to Captive Insurance Companies Association (CICA), the first captive ever formed was in the late 1800s, and was designed to write more cost effective fire insurance policies for New England textile manufacturers that were hit hard by increasing market rates.

Captives gained popularity in the 1980s as a result of the US liability crisis, particularly in the medical arena.

As captives have continued to grow over time, employers are considering employee benefits as a new or expanded coverage. The more recent hard market and changing economy is expected to spur even more and rapid industry growth yet this year.

Single Parent (Pure) Captive: A single parent captive is owned and controlled by one owner, typically the parent organization, and is formed as a subsidiary company. The captive subsidiary underwrites policies for the parent, and solely bears the risks of the parent.

►Group Captive: A group captive is owned and controlled by multiple insureds. They may or may not be related entities or a part of a homogeneous group like industry or trade groups. Typically, companies of similar size pool their risks in an industry captive with customized insurance plans. Similarly, companies of similar size in different industries can also form group captives to enjoy the benefits of a captive model. More recently, associations have been forming association captive insurance companies to offer captive services as part of their membership benefits.

►Agency Captive: Agency captives are companies typically owned by groups of brokers or other insurance intermediaries and are typically structured like rent-a-captives.

►Risk Retention Groups

Risk Retention Groups were also created by the Liability Risk Retention Act of 1986, which provides for streamlined regulation. A RRG is an insurance company in every regard but has one very important regulatory distinction. Every RRG chooses a single state in which to be domiciled and regulated. The act provides that the RRG is then eligible to do business in all states.

►Program Business Captives

Associations, regional producers and corporations who desire to assume some selected third-party exposure.

Wayne Walker, Windward Harbor Insurance Management LLC ©Windward Harbor LLC 2004

Windward Harbor Insurance Management LLC is a licensed insurance manager in the British Virgin Islands with office in Pinehurst, NC, Atlanta, GA, and St Petersburg, FL.

What Does Buildings Insurance Cover?

You will find that your lender will insist that you have this cover when you take out a mortgage. The lender, remember, owns your home until you have paid off the mortgage. However, because they don’t live in it, you are responsible for it, thus you need to insure the building. Should the property fall down, the lender wants it to be covered for the catastrophe.

But buildings insurance cover permanent fixtures and fittings as well. It will also cover toilets, baths and fitted kitchens, your interior decorations and bedroom cupboards.
To know what your buildings insurance will cover, try this simple test – can you reasonably remove the fixture and take it to a new home? If you can it will be covered by contents insurance – as if you can remove it, so can a thief! If you can’t, it will be covered by your buildings insurance.

Your buildings policy insurance should also be able to cover – perhaps for a small extension to your premium – outbuildings such as your garages, garden sheds and greenhouses. However, it is unlikely that you can extend it to cover your swimming pools, fences, paths, gates or drives.

The risks which are covered by your buildings insurance are many. Your property faces damage from so many angles. Perhaps reading this list will make you realise just how important buildings insurance is.
Fire, lightning and explosions can cause damage to your house, as can earthquakes, storms and floods. Don’t underestimate the damage that thieves can cause to your home. They have to get in somehow, and can damage property that way. Sometimes, they will try and steal fixtures that aren’t easily removable (e.g. a chandelier) or will damage your property whilst looking for valuables. This damage would not be covered by contents insurance.

Should you suffer problems with your tanks or pipes, in terms of water leaking from them, or perhaps oil could escape from fixed heating installations, you should be covered under your buildings insurance.
Then there are the more unusual occurrences. Your home could be damaged by being caught in the middle of a riot. It could be the victim of an attack by vandals (‘malicious persons’ in insurance parlance). Perhaps a falling tree will crash through your window, or an aerial will fall off the roof and through your window.

Subsidence, land slip and heave can also cause damage to your home, which is why the insurance company will want to know if your home is in an area at risk from them. Finally, it has been known for cars and animals to cause damage to homes, and occasionally an aircraft or “things falling from an aircraft” can cause damage.

Consumer Directed Health Plans

Most of you have heard about “consumer directed health plans”. The Bush administration has been a strong supporter of this concept as a way to get a handle on soaring healthcare costs. The recent inaugeration of Mr. Bush signals that consumer directed health plans will increasingly make up a larger percentage of group medical plans over the next several years. In the past, consumer directed plan designs have taken on many forms: Medical Savings Accounts (MSAs), Flexible Spending Accounts (FSAs), Health Reimbursement Arrangements (HRAs) and Health Savings Accounts (HSAs).

Many experts consider HRAs and HSAs to be the first generation of viable consumer directed health care products. HRAs are typically paired with a high-deductible health plan and are employer-funded Section 105 defined contribution plans. HSAs are the latest version of consumer directed health care plans. The core components of HSAs include a high deductible insurance product and a cash spending account. HSAs combine the pre-tax treatment of a FSA, the portability and roll-over characteristics of a 401(k), and the tax-free distributions of a Roth IRA.

One of the main goals of any consumer directed health plan should be to get the consumer more involved in both the cost and statistical outcomes of certain healthcare procedures. Informed healthcare consumers will make wise healthcare decisions and typically these decisions will result in both lower costs and improved quality.

Although the advantages of HRAs and HSAs can be substantial, employers will want to do their homework prior to setting them up. Effective implementation will require a clear understanding of the consumer directed healthcare plan that best fits your organization as well as the administrative requirements. Employee education will be essential. Companies will also need to look into how the creation of a HSA or HRA may affect their HIPAA medical privacy compliance requirements.

Just like most endeavors, the successful implementation of a HSA or HRA will greatly depend on how much research your organization does on the pro’s and con’s of each alternative. The type of consumer directed health plan that best fits your company will depend on a combination of your corporate structure as well as the overall objectives of your group health insurance plan.

Although consumer directed healthcare plans are becoming very familiar to human resource managers and other benefit professionals, remember that your employees and their dependents will need a substantial amount of education and communication.