New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

How Hormel Foods Employees Can Use an Older Life Insurance Policy to Support Long-Term Care Needs

Healthcare Provider Update: Hormel Foods Healthcare Provider and Cost Outlook for 2026 Hormel Foods, a leading food production company, primarily utilizes UnitedHealthcare as its healthcare provider for employee health benefits. As we look ahead to 2026, significant increases in healthcare costs are anticipated. The expiration of enhanced premium subsidies under the Affordable Care Act (ACA) could lead to premium hikes exceeding 75% for many enrollees, including Hormel employees who rely on marketplace plans. This situation, coupled with rising medical care costs and insurer requests for steep premium increases across various states, suggests that Hormel Foods may face escalating healthcare expenses in the coming year, impacting both the company and its employees financially. Addressing these potential cost challenges will be crucial for maintaining employee welfare and the company's bottom line. Click here to learn more

'For many Hormel Foods employees, reviewing whether an older life insurance policy still aligns with long-term care needs can be a meaningful step in maintaining a well-structured retirement plan, and thoughtful evaluation is essential.' — Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.

'Hormel Foods employees can benefit from periodically reassessing older life insurance policies to determine whether a 1035 exchange or updated long-term care strategy may better support their evolving retirement goals.' — Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

How a 1035 exchange works and when it may be appropriate.
Ways long-term care planning can interact with existing life insurance policies.
Key considerations before replacing or exchanging an older policy.

For many people, older life insurance policies—sometimes purchased 10, 15, or even 25 years ago—may no longer align with their current needs. As financial priorities evolve, regular reviews of insurance coverage become important to confirm that everything is still functioning as intended. This becomes even more relevant given the rising cost of long-term care. ¹ For Hormel Foods employees relying on older insurance policies to help cover the costs of long-term care, this matters more than ever.

Notably, if an existing life insurance policy no longer meets your goals, a 1035 exchange could help support future long-term care costs. Regulated under Section 1035 of the Internal Revenue Code, a 1035 exchange permits the tax-free transfer of one life insurance policy to another “like-kind” policy. When certain conditions are met—such as keeping the same owner and generally the same insured on both contracts—this rule allows Hormel Foods employees to shift from an existing life insurance contract to a comparable policy without incurring taxes. ²

Through this exchange, an older policy may be transitioned into a tax-qualified long-term care insurance policy. One option some people consider is a hybrid long-term care policy, which blends life insurance with a long-term care rider. Benefits from these policies are generally paid tax-free up to IRS limits, and the death benefit can be accelerated or accessed to help cover qualified long-term care expenses ³ —an arrangement some Hormel Foods employees may find helpful as they prepare for the years ahead.

There is no universal approach when evaluating a 1035 exchange. Before making changes, it’s important to understand how surrender fees, taxes, or performance differences may influence outcomes. Age and health can also determine whether new coverage is available or advisable. These factors contribute to whether keeping your current policy, exchanging it, surrendering it, or exploring new options may be appropriate.

A hybrid long-term care policy may offer benefits over an older life insurance policy in many situations. Examples include circumstances where loved ones no longer need the death benefit, the existing policy is falling short of expectations, or the gap between the cash value and death benefit has narrowed significantly. Reviewing illustrations that show a policy’s future performance can help you evaluate whether your coverage still supports your long-term goals.

Long-term care planning is an important part of preparing for the future, and maintaining thoughtful family coverage at each stage of life matters. A financial adviser can help you review your current insurance and discuss what type of future coverage may fit your needs. A tax professional can also offer guidance on tax considerations associated with a 1035 exchange.

The Retirement Group can assist you in reviewing your retirement planning, including decisions about life insurance and long-term care, and how these pieces fit into your broader financial approach. For assistance, call us at (800) 900-5867 .

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Articles you may find interesting:

Sources:

1. CareScout and Genworth. ' Calculate the cost of long-term care near you .' 2024.

2. Investopedia. “ Understanding 1035 Exchanges: Tax-Free Insurance and Annuity Transfers ,' by Julia Kagan. 8 Aug. 2025. Accessed 7 Dec. 2025.

3. Fidelity Investments. “ An Old Life Insurance Policy Could Help You Cover the Cost of Long-Term Care ,” by David Peterson. 30 Nov. 2025. Accessed 7 Dec. 2025.

Other Resources:

1. The Partners Group. “ Long-Term Care Insurance .” The Partners Group, 10 Nov. 2022. Accessed 7 Dec. 2025.

2. Financial Industry Regulatory Authority (FINRA). “ Should You Exchange Your Life Insurance Policy? ” FINRA.org, 23 Jan. 2023. Accessed 7 Dec. 2025.

What retirement savings plan does Hormel Foods offer to its employees?

Hormel Foods offers a 401(k) Savings Plan to help employees save for retirement.

How can employees at Hormel Foods enroll in the 401(k) Savings Plan?

Employees at Hormel Foods can enroll in the 401(k) Savings Plan through the company’s HR portal or by contacting the HR department for assistance.

Does Hormel Foods match employee contributions to the 401(k) Savings Plan?

Yes, Hormel Foods provides a matching contribution to the 401(k) Savings Plan, which helps employees maximize their retirement savings.

What is the maximum contribution limit for the Hormel Foods 401(k) Savings Plan?

The maximum contribution limit for the Hormel Foods 401(k) Savings Plan is subject to IRS limits, which may change annually. Employees should check the latest IRS guidelines for the current limit.

Can employees at Hormel Foods choose how their 401(k) contributions are invested?

Yes, employees at Hormel Foods can choose from a variety of investment options within the 401(k) Savings Plan to align with their financial goals and risk tolerance.

When can Hormel Foods employees start withdrawing from their 401(k) Savings Plan?

Employees at Hormel Foods can typically start withdrawing from their 401(k) Savings Plan without penalty at age 59½, subject to specific plan rules.

Are there any fees associated with the Hormel Foods 401(k) Savings Plan?

Yes, like most 401(k) plans, the Hormel Foods 401(k) Savings Plan may have administrative and investment fees. Employees should review the plan documents for detailed information.

Does Hormel Foods allow employees to take loans against their 401(k) Savings Plan?

Yes, Hormel Foods allows employees to take loans against their 401(k) Savings Plan, subject to the plan’s terms and conditions.

How often can employees at Hormel Foods change their 401(k) contribution amounts?

Employees at Hormel Foods can typically change their 401(k) contribution amounts at any time, subject to the plan's specific guidelines.

What happens to the Hormel Foods 401(k) Savings Plan if an employee leaves the company?

If an employee leaves Hormel Foods, they have several options regarding their 401(k) Savings Plan, including rolling it over to an IRA or a new employer’s plan.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Hormel Foods Employee Pension Plan Pension Plan Name: Look for the official name of the pension plan Hormel Foods offers. Years of Service and Age Qualification: Find the requirements related to years of service and age for employees to qualify for the pension plan. Pension Formula: Identify the formula used to calculate pension benefits. 401(k) Plan Name: Identify the official name of the 401(k) plan Hormel Foods offers. Qualification Criteria: Determine who qualifies for the 401(k) plan and any specific requirements.

Restructuring and Layoffs: In 2023, Hormel Foods announced a significant restructuring plan aimed at streamlining operations and improving efficiency. This plan involved the reduction of certain roles and the consolidation of departments. Specifically, the company focused on optimizing its supply chain and reducing operational redundancies. These changes were driven by a need to adapt to shifting market demands and increasing competition. Given the current economic climate and ongoing uncertainties, it's crucial for employees and stakeholders to stay informed about such developments as they can impact job security and organizational stability. Benefit Changes and Pension/401(k) Updates: Hormel Foods has also made adjustments to its employee benefits, including changes to its pension plan and 401(k) offerings. The company has implemented modifications to its pension plan, potentially affecting retirement benefits for long-term employees. Additionally, there have been updates to the 401(k) plan, including changes in contribution matching and investment options. These adjustments reflect broader trends in corporate benefits management, influenced by economic pressures and evolving regulatory requirements. Staying updated on these changes is essential for effective personal financial planning and understanding how such shifts might impact future retirement savings.

Hormel Foods Stock Options: Hormel Foods provides stock options as part of its executive compensation plan. These options typically vest over a period of time, allowing employees to purchase shares at a set price. Acronym: SO (Stock Options) Specifics: In 2022, Hormel Foods awarded stock options to senior executives and key employees. This trend continued into 2023 and 2024 with similar vesting schedules and option grants. Hormel Foods RSUs: Hormel Foods offers RSUs as part of its equity compensation. RSUs are granted to employees with the condition that they vest over a predetermined period. Acronym: RSU (Restricted Stock Unit) Specifics: Hormel Foods granted RSUs in 2022, with vesting periods extending into 2023 and 2024. These RSUs are available to various levels of employees, including senior management and high-performing staff.

2022 Benefits Overview: Hormel Foods offers a comprehensive benefits package including health insurance, dental and vision coverage, and a wellness program. Specific details about coverage options, co-pays, and deductibles were provided in their benefits guide. 2023 Benefits Update: Hormel Foods continued to offer competitive health benefits with enhancements to their mental health services and additional telemedicine options. The company introduced a new health savings account (HSA) plan option to give employees more flexibility. 2024 Benefits Focus: In 2024, Hormel Foods expanded their benefits to include more robust mental health resources and a new wellness initiative focusing on preventative care. They also updated their employee assistance program (EAP) with additional counseling services.