fbpx

Save up to 50% on life insurance.

Self Insured Company Disability Plans

As part of the Nortel Bankruptcy, one of the biggest victims was employees on disability. The disability plans ended up in a mess, and those on disability lost their benefits. I knew a few folks who were directly impacted by this, and it makes me very upset thinking of them. Could this happen again? You’d hope not, but nothing much has changed.

More Insurance that Doesn’t Quite Insure

Behold the plight of the 400+ Nortel employees (Canadian) who have been living on disability insurance. They will be cut off from their benefits. This has come to light in the media finally. Nortel officially disappeared a while ago.

How can this be, you ask? Nortel and other large companies typically self insure these kinds of plans. This means though it looks like you have your insurance with a large insurance company, you don’t. Your policy is held by your employer and is paid out by your employer (when you make a claim). It is much cheaper to have the insurance company administer the Insurance Policies to the large company. The money comes from the large company directly (rather than merely paying premiums to the insurance company and profit from the programs).

So what is the problem? The apparent issue with Nortel is that the company does not exist anymore. Anyone owed money through this kind of disability policy is now only an unsecured creditor and is likely to get very little (if any) more money. The fact that the firm can dodge this debt by simply declaring bankruptcy is terrible (in my opinion).

So what can be done? For the folks at Nortel, not much more. They have hammered out a deal to get whatever money they can. However, as of the cut-off date, they will be without income, leaving them few options to live on. They may have access to the Canada pension plan disability, but not much else. Those with disability insurance with large firms that are currently self-insuring should be contacting their MP’s right away to have put in place some protection system for this kind of insurance policy.

Former Legislation

There are two pieces of legislation on the books about this topic:

  • Bill S-216 An Act to amend the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement to protect beneficiaries of long term disability plans (authored by Senator Art Eggleton)
  • C-476 An Act to amend the Bankruptcy and Insolvency Act and other Acts (unfunded Pension Plan Liabilities) (author Wayne Marston (Hamilton-East-Stoney Creek))

Talk to your MP and MPP about these two acts and why they died.

Pension reform is needed as well, but these “policies” being held on the companies books as debt liabilities and not like a pension (which is owned by an Arm’s length company that the Insurer funds) puts 1.1 Million people at risk currently (according to the Canadian Life and Health Insurance Association (from the CBC post Disability Insurance at risk for 1.1 Million)).

If you are in this kind of disability insurance program, you may be at risk, and it would be in your best interest to follow up on this issue.

What upsets me is I paid for this insurance when I worked at Nortel, and it was a costly premium that was paid for peace of mind, yet the money effectively went into the companies coffers instead of a safe place. In case I needed it?

The worst part of this whole story is I know people directly affected by this cut-off, and they are the ones who need help. We shall see how this shakes out, but please feel free to comment if anyone knows more about this.

Addendum

I am most likely in the same situation now. I am a Civil Servant, and I guess that the Government self-insures. This couldn’t happen again, could it? Remember, Nortel was too big to fail. The government couldn’t declare bankruptcy, could it?

Other Nortel Disability Stories

From the archives 2010

{ 5 comments }

Financial Reboot

One of the major tricks I learned when I was an I.T. dude, was how easy it was to fix problems if you asked your customer, “Have you rebooted your system lately?“. I also knew this drove my customers nuts, but it worked most of the time, and they had to then go away, and I usually had a good chuckle. A financial reboot might not be a bad idea as well.

a financial reboot

Now THIS is a COMPUTER (Vic 20)

When I was at the Maundy Thursday service at my Church during Holy Week, it ends with a complete stripping of the alter and the turning off all the lights in the Church, effectively ending the Church year, and then on Easter morning, this is the start of a new year, effectively a spiritual reboot.

Restart Financially?

This strikes me as a useful idea for those who may be stuck in a financial rut, or feel they are drowning in their own financial plans. I am not espousing declaring bankruptcy or walking away from your financial issues (that is the ultimate financial reboot, and should really be a solution of last resort), but I am saying that maybe a financial reboot in your  thinking is needed?

How can you reboot financially? Some ideas that might work are:

  • Re-vamp your investment ideas, and move away from an active investment plan to a passive or Index based plan. Maybe your issue with your investments is that you just don’t know enough about how to invest (I know I don’t), but if you go with the indexes you are more likely to succeed (as long as you choose the right indexes). This kind of reboot in your methodology may help you in the long run?
  • If you and your spouse don’t talk about money much, maybe it’s time to reboot, and then plan weekly discussions about what is going on with money so that both of you know what is going on. This might ease the money tension in your house and give you new ideas about things.
  • If you have no financial plan, reboot, and make one. If you feel living day to day is not working for you, reboot and restart with a plan that will help you feel more in control.
  • When you retire a debt (especially if it is a Credit Card), maybe retire that debt vehicle (i.e. close the account), so that it cannot resurrect itself later. Rebooting your credit vehicles by getting rid of unneeded credit devices is a good idea, if you have had issues with them previously.

A financial reboot gives you a fresh start, and maybe can put you back on the right path?

{ 1 comment }

One Thing You Can Buy on Boxing Day

So a while ago, I spoke about how Anti-Virus software is needed, but the pricing trickery is ridiculous.

On Boxing Day here in Ottawa, pricing games were driven home like a nail from a pneumatic nail gun.

I have noticed that the Boxing Day sales regularly have Anti-Virus software on sale, so I decided I would wait and see what might happen with the sales.

Sure enough, our Amigos at Future Shop delivered and had Norton 360 on sale for $29.99, for three machines and for a 15-month subscription (remember to renew for one device for 12 months was going to cost $79.99), so my patience seems to have paid off. I checked the Norton site and they had a Boxing Day sale for the same product (3 licenses Norton 360) for $69.99 (wow).

I guess we can add Anti-Virus software that you can purchase at the Boxing Day madhouse.

Previous Boxing Days?

I have written on the topic of Boxing Day a few times.

{ 2 comments }

Cell Phone Cameras, not just for Duck Faces

In the early days of Cell Phones, I ridiculed when I heard that they were including a Camera in Cell phones (who would use that, and what for, I believe was my arguments about the validity of melding these two technologies), however (as usual), I have been proven wrong and these two technologies are now permanently cemented together (much to the chagrin of Kodak and Polaroid, I would wager). The Cell Phone Camera has caused an explosion of media on the web with folks sharing and posting pictures of:

  • Food: what you are eating, where you are eating it, and who you are eating with, astoundingly interesting. Evidently that is the biggest use for Cell Phone cameras.
  • Billions of photos of our children taking pictures of themselves in bathroom mirrors, in various states of disrepair (and or dress), smiling in odd ways (or even the infamous duck face). This has forced the porn industry into rethinking itself yet again.
  • Very jerky videos of odd events as they occur.

A Bad Example, but you get the idea. This is a photo of my wife’s new iPhone!

And this really only scratches the surface of what the Cell Phone Camera has touched in our lives, however, it can actually do a useful thing as well (no, not supply blurry pictures for blogs) it can help us more easily catalog the valuables in our houses.

As I mentioned in Theft and Insurance having a valid home inventory which is up to date, with photos of your valuables is a very good thing to have, and with a Camera Phone you really have no excuse any more.

Some tips that could make this even better:

  • Create an account on one of the many picture archiving sites (preferably one that allows for PRIVATE Albums of photos), where you can upload your pictures to.
  • When you are taking your pictures, if your camera has a GPS capability, use it to tag the photo as well. Never hurts when your insurance company gets the photos, to say they were taken at your house.
  • Make sure you are using your camera in Highest Definition mode and download them in that format as well.
  • Add a detailed description of what the picture is of, and possibly the value of the object
  • Make sure the picture is clear as well (you can take many pictures, you only need 1 clear one).

With this, you now have an off site backed up archive of the valuables in your house, in case of a fire, or theft, and it didn’t really cost you too much either (upload your pictures using Wi-Fi as well, saves you high data charges by your cell phone company).

Give the insurance company as much information as you can, and you are more likely to get your claim dealt with in a quick and concise manner.

 

{ 0 comments }

Facebook IPO and Random Thoughts

The long-awaited Facebook IPO (stock symbol FB) has been announced (published in February 2012) , is it time to jump in and make some money on this Tech darling (but the voices in my head say remember Nortel and Yahoo)? I will not be buying in, mostly because I wouldn’t buy a stock directly (I am in my passive investing phase) and while Facebook could be the next Google (symbol: GOOG) it has a chance not to be as well. I will simply watch with interest to see how the feeding frenzy goes.

It was Groundhog Day yesterday too, and as usual the various entrants all made their own predictions, but I can safely predict that Spring will come this year, some time (and if it doesn’t we are really in trouble).

It is also a Super Bowl weekend, where non-football lovers get to watch their loved ones turn into raving loonies over 1 game. I will attempt to create my standard chilli, and make sure I have enough beer, in case the Giants don’t play well. The Super Bowl seems to be an event bigger than Christmas (and with a longer lead-up period too).

Weekly Recap

We washed the all-stars out of Ottawa, this week Winterlude begins, but in terms of posts I am fixated on mass transit it seems:

And thanks to those who added me on Twitter I am now over 1000 folks who follow me, zut alors! Check out my facebook page as well (but no I won’t be buying Facebook stock because of this either).

Facebook’s IPO was big in the news, but RIM is still out there bubbling up, and TAX TIME is even more important too:

Remember my RSS feed is available too, for those who enjoy reading without looking at my crappy page lay out, and I have added an RSS Comment Feed as well.

Have alook at my micro-blog on Twitter, where you can see a whole plethora of good articles and pithy comments by me as well. Twitter feed where I re-tweet many great articles by some of my featured writers (and make the occasional odd or off colour commentary on life (in 140 characters or less)). I am also on Digg as Big Cajun Man, on reddit, Tumblr and other Social Media sites (look for the BigCajunMan userid) as well.

If you have social media accounts, don’t forget to vote for my posts (see the nifty dashboard on the bottom of each article, where you can cast your votes). As they say in Quebec, vote early and vote often!

This site is iPhone Friendly (and Android , iPod Touch and iPad Friendly), enjoy it on the go, in a readable format for the device. If you are reading with an iPhone or Android device, drop me a comment and tell me if this needs any improvements. This site is also in the Kindle US Blog list, if you are interested, not available in Canada yet (because no Blogs are available in Canada on a Kindle?!?).

A Quote for Groundhog Day

“There is no way that this winter is *ever* going to end as long as this groundhog keeps seeing his shadow. I don’t see any other way out. He’s got to be stopped. And I have to stop him. ”  

Phil Conner from Groundhog Day (played by Bill Murray), yes, I think the groundhog must be STOPPED!!!!

{ 4 comments }

%d bloggers like this:
/