Adam & Cassie Porterfield

Adam and Cassie Porterfield, a healthy couple in their mid- 30s, were delighted when Adam landed a new job with a promotion and increased salary. But, they were disappointed to learn that he would not be eligible for benefits for 90 days. The company offers a comprehensive package of health insurance, vision insurance, dental insurance, life insurance (1.5 times salary at no premium charge), short- and long-term disability insurance, and long-term care insurance. An employee can choose how to spend the employer-provided premium dollars to purchase any combination of insurance or additional life insurance. Fortunately, Cassie has group health insurance with a $1 million lifetime per covered individual.

Please answer in complete sentences

QUESTIONS

1. Adam has heard that his employer offers a health insurance opt-out option with a $75 a month payment to the employee. Assuming Cassies employer offers very similar coverage limits, should Adam and Cassie consider the opt-out option? Discuss the pros and cons of opting out, including the protection of the Health Insurance Portability and Accountability Act of 1996. What premium costs and opt-out payments should they consider in their analysis?

2. In the mix of premiums the Porterfields can spend, how should Adam and Cassie rank Adams insurance needs for the seven types of coverage offered? What factors should they consider?

3. Name two or three important factors to consider when purchasing disability insurance. Should Adam first consider short-term or long-term disability?

4. Should Adam consider purchasing more life insurance than the company-provided free benefit? What two methods could he use to assess his needs relative to his total life insurance coverage?

5. Should the Porterfields consider changing their company-provided insurance benefits if they become parents? Defend your answer.

6. To avoid exclusion of any preexisting conditions by his new employers health insurance coverage, what should Adam do? Would a Health Savings Account be a better option for coverage during his first three months with the company?