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New HRA and HSA Contribution Limits for 2025

August 6, 2024

As healthcare costs continue to climb, it's essential to leverage all available resources. For those using Health Savings Accounts (HSAs) or Excepted Benefit Health Reimbursement Arrangements (HRAs), there’s encouraging news: contribution limits for these tax-advantaged accounts have been increased for the coming year.


The Internal Revenue Service (IRS) recently released the inflation-adjusted contribution limits for HSAs and the maximum allowances for HRAs for 2025.


For individuals with self-only coverage under a high deductible health plan (HDHP), the HSA contribution limit will rise to $4,300 in 2025, up from $4,150 in 2024. For those with family coverage under an HDHP, the limit will increase to $8,550 from $8,300. The IRS defines an HDHP as a plan with a minimum annual deductible of $1,650 for self-only coverage or $3,300 for family coverage. Additionally, the total annual out-of-pocket expenses, including deductibles and co-payments (but excluding premiums), cannot exceed $8,300 for self-only coverage or $16,600 for family coverage.


HSAs are particularly beneficial because they are funded with pretax dollars, providing significant tax advantages. The IRS limits include both employee and employer contributions. Employees aged 55 and older can also make an additional catch-up contribution of $1,000 annually.


Excepted Benefit HRAs allow employers to reimburse employees for certain medical expenses not covered by primary group health plans, such as vision or dental care, coinsurance, and co-payments. These HRAs act as a supplementary resource for medical expenses. For 2025, the contribution limit for employers to an employee’s excepted benefit HRA will increase to $2,150, up from $2,100 in 2024.


These changes are tied to the Consumer Price Index (CPI), so adjustments in contribution limits are common during periods of inflation. These updates are designed to help employees better manage their healthcare expenses by providing them with adequate resources.


For more information about these benefits or to explore other group healthcare options, please reach out to us. Our knowledgeable health insurance specialists can assist your company in selecting the best plans for your employees, ensuring a healthier and more satisfied workforce.

The Benefits of Hybrid Life and Long-Term Care Insurance Policies

March 18, 2025
Planning for both future healthcare needs and financial security can be challenging. A hybrid life and long-term care (LTC) insurance policy offers a unique solution by combining life insurance benefits with coverage for long-term care expenses. Depending on exact needs and circumstances, this type of policy might be a smart choice for retirees and their families. What Is Hybrid Life and Long-Term Care Insurance? Hybrid policies blend life insurance coverage with long-term care benefits, providing financial support whether you need extended care during your lifetime or leave behind a death benefit for your beneficiaries. Unlike traditional long-term care insurance, which operates on a "use it or lose it" basis, hybrid policies ensure that your investment isn’t wasted if you never need long-term care. Key Benefits of Hybrid Policies Dual Protection – These policies provide coverage for both long-term care costs and life insurance payouts, ensuring that funds are used efficiently. Guaranteed Benefits – If long-term care is not needed, your loved ones will still receive a death benefit payout. Premium Stability – Traditional LTC insurance premiums can rise unpredictably, but hybrid policies often have fixed or limited payment periods. Flexible Use of Funds – Policyholders can use long-term care benefits for various needs, including home care, assisted living, or nursing home care. Potential Tax Advantages – Benefits used for qualified long-term care expenses are often tax-free, providing additional financial relief. Is a Hybrid Policy Right for You? A hybrid life and LTC policy is ideal for those who: Want to ensure their long-term care needs are covered while still leaving an inheritance. Prefer predictable premiums without the risk of losing their investment if care isn’t needed. Are concerned about rising healthcare costs in retirement. Have funds available for a lump-sum or limited-time premium payment. Plan for Your Future Today Choosing the right insurance policy is crucial for securing your financial future and protecting your loved ones. If you’re interested in learning more about hybrid life and long-term care insurance, contact us for expert guidance on finding the best coverage for your needs.

Burial Insurance vs. Traditional Life Insurance: Which Do You Need?

March 11, 2025
When planning for the future, many people consider life insurance to ensure their loved ones are financially protected after they pass away. However, not all life insurance policies serve the same purpose. Two common types are burial insurance and traditional life insurance, and understanding the differences can help you make the right choice for your needs. What Is Burial Insurance? Burial insurance, also known as final expense insurance, is a type of insurance policy designed specifically to cover funeral and burial costs. Policies typically range from $5,000 to $25,000, ensuring that expenses such as cremation, a memorial service, or a casket are paid for without placing a financial burden on family members. While burial insurance provides peace of mind for covering end-of-life expenses, it has limited benefits and does not offer financial security beyond funeral costs. It won't help cover other expenses like: Medical bills left behind Living expenses for surviving family members Mortgage or debt payments Replacement income for dependents What Is Traditional Life Insurance? Traditional life insurance, which includes term life and whole life policies, offers a broader financial safety net for beneficiaries. These policies provide a larger death benefit, often starting at $100,000 or more, which can help with: Paying off outstanding medical and credit card debt Replacing lost income for surviving spouses or children Funding education costs for children or grandchildren Covering long-term living expenses Unlike burial insurance, traditional life insurance is meant to provide lasting financial protection for your family rather than just covering funeral costs. Which One Do You Need? The best option depends on your financial situation and what you want your insurance policy to accomplish. If your primary concern is ensuring your funeral and burial costs are covered without burdening your loved ones, burial insurance may be sufficient. If you want to protect your family’s financial future, cover major expenses, and replace lost income, a traditional life insurance policy is the better choice. In some cases, individuals choose to have both types of policies—burial insurance for final expenses and traditional life insurance for broader financial protection.
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