Aflac Insurance Policies

[EricaCallaha]

So we have the option through my husband's employer to obtain an Aflac insurance policy. We have filed our 13, are confirmed and making payments. My question is...When AFLAC pays us, do we have to give that money to the trustee? It is not an insurance settlement, so do we have to notify the trustee of the payment? Or should we just not obtain this policy at all?

Thanks...

[justbroke]

If you're talking about a term life policy, that has value, then the Trustee sees that as an asset. You should consult your attorney before getting such a policy to understand the impacts on a Chapter 13 Plan and case.

[EricaCallaha]

It is not a life insurance policy. Aflac is a supplemental insurance policy that pays you...for example..if you go to the doctor, break your arm, have to go to the ER, have a baby. The amount of money you get varies. For example, if you have a baby then they pay you about $4k. Would that money have to go to the trustee?

Thanks.

[justbroke]

It is not a life insurance policy. Aflac is a supplemental insurance policy that pays you...for example..if you go to the doctor, break your arm, have to go to the ER, have a baby. The amount of money you get varies. For example, if you have a baby then they pay you about $4k. Would that money have to go to the trustee?

Thanks for letting me know it's supplemental medical insurance. I didn't even read the word AFLAC above!

So, not that I know of... if it offsets medical co-pays...

[EricaCallaha]

Hmmmm....I guess I will have to seriously consider this policy. We have kids and this might be nice to have. I guess I will have to put a call into the atty to be extra safe.

Thanks.

[EricaCallaha]

Now, in thinking this further....this insurance offsets medical co-pays and then some.

For instance..Say I were to have a baby. I only have to pay $15 for office visits (and only 1 time) and $350 to have it at the hospital. I have a healthcare flexible spending account that reimburses me with pre-tax money that I contribute. So for having a baby I get $365 from my FSA and 4k from Aflac. I know the $365 is mine to keep, but what about the 4k? The 4k isn't really to offset the medical co-pays. It is kind of like reimbursement for my time.

Do you think this still would stay with me or go to the trustee?

Thanks.

[justbroke]

Do you think this still would stay with me or go to the trustee?

I really don't know if it's "income" or not. If it's taxable (you get some sort of 1099 at the end of the year), the Trustee could see it in your tax return. However, they don't generally try to modify plans for small amounts. If you're in a plan what is 70%+ then they generally don't bother you at all.

[EricaCallaha]

I will have to research if it is taxable or not. I am sure that it is. Our trustee seems pretty relaxed about most things. Maybe he would let this slide. The way the numbers settled..we look to be in about a 40% payback to unsecureds.

[walkthaplank]

Is this like disability insurance?

[car67]

I think in this case if the plan is already confirmed and active then use the money and at the end of the year if you get some form of tax document just send it in with your taxes the review team i am sure will contact you if it appears they are interested but would definetly use it for the first time until told different?

[EricaCallaha]

It is not disability insurance. It is supplemental insurance. Basically they pay you when you have things happen to you. If you go to the ER..you get x amount of dollars, if your kid breaks her arm..you get x amount of dollars.

[welovedis]

We have AFLAC & the payments are not taxable. It has never come up in our Ch 7/conversion to Ch 13 even though we were paid twice d/t our son's injuries. We explained the deposits into our acct but nothing else was mentioned.

Also, I'm not sure that term life insurance (which has nothing to do with AFLAC but was mentioned above) has value, except in the event of death. Term doesn't build in value like whole or universal life--it is only paid in the event that the insured dies.

When we filed we have a term, universal and whole and the only policies considered were the universal & whole life policies. The term was not a consideration.

[EricaCallaha]

Perfect...Exactly what I wanted to know about Aflac. Thanks!