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

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'For many Valero Energy 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.

'Valero Energy 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 Valero Energy 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 Valero Energy 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 Valero Energy 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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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 are the modifications to retirement plan contributions for employees of Valero Energy Corporation in 2024, and how do these changes impact both traditional 401(k) contributions and Roth contributions? Could you also elaborate on the distinctions between the two types of contributions offered by Valero Energy Corporation and the potential tax implications for employees?

Modifications to Retirement Plan Contributions: In 2024, Valero Energy Corporation has adjusted its retirement plan contributions to align with evolving regulatory and economic environments. The company offers both traditional 401(k) contributions and Roth contributions. The traditional 401(k) contributions are made pre-tax, reducing the taxable income for employees, which is beneficial during their high-earning years. Roth contributions are made after-tax, offering tax-free growth and withdrawals, which can be advantageous if employees expect to be in a higher tax bracket in retirement. The choice between these options allows employees to tailor their retirement savings in a way that best suits their long-term financial planning.

How can employees of Valero Energy Corporation maximize their retirement benefits through the company's defined benefit or defined contribution plans? Specifically, what strategies or options can employees consider to ensure they are adequately preparing for retirement, including the effects of employer matching contributions and vesting schedules offered by Valero Energy Corporation?

Maximizing Retirement Benefits: Employees of Valero can maximize their retirement benefits by taking full advantage of the company’s matching contributions in the defined contribution plans, which is an immediate return on their investment. Understanding the vesting schedules is also crucial, as it determines the ownership of employer-contributed funds. Employees should consider contributing at least enough to receive the full match, as it represents part of their compensation package. Regularly reviewing and adjusting their investment portfolio within the plan can help in aligning with personal retirement goals and risk tolerance.

What are the eligibility criteria for employees of Valero Energy Corporation to participate in the company's pension plans, and how are accrued benefits calculated over time? Additionally, how do these factors contribute to an employee's overall retirement readiness when planning for post-employment life?

Eligibility and Accrual of Benefits: To participate in Valero's pension plans, employees typically need to meet specific eligibility criteria, which might include a minimum period of service or age requirements. The benefits accrued depend on factors like years of service and salary history. These plans are designed to provide a stable income stream in retirement, contributing to an employee’s overall retirement readiness. Understanding these aspects of the pension plan can help employees plan more effectively for their retirement.

In the event of a job change or leaving Valero Energy Corporation, what options do employees have for managing their retirement accounts? Could you discuss in detail the pros and cons of rolling over a 401(k) into an individual retirement account (IRA) versus cashing it out?

Options Upon Job Change or Leaving Valero: If an employee decides to change jobs or leave Valero, they have several options for managing their retirement accounts. Rolling over a 401(k) into an individual retirement account (IRA) can provide more investment options and potentially lower fees, while preserving the tax-deferred status. Cashing out the 401(k), although immediately accessible, can lead to substantial penalties and taxes, reducing the retirement savings. Each option has pros and cons, depending on the individual's circumstances and retirement strategies.

How does Valero Energy Corporation ensure compliance with federal and state regulations regarding its retirement plans? What specific measures are taken to protect employee retirement savings, and how does the company communicate these protections to its workforce?

Compliance with Regulations: Valero ensures compliance with federal and state regulations regarding retirement plans through regular audits, adherence to plan documents, and by providing transparent communication to employees. The company takes measures to protect the retirement savings of its workforce, which helps in maintaining trust and reliability in its retirement plan offerings.

What resources are available to Valero Energy Corporation employees for financial planning as they approach retirement age? Please provide details on any company-sponsored educational programs, one-on-one financial counseling, or third-party resources that can assist employees in making informed decisions.

Resources for Financial Planning: Valero provides various resources to assist employees in planning for retirement, including access to financial planners, workshops, and online tools that offer personalized guidance. These resources help employees make informed decisions about their retirement savings and overall financial health as they approach retirement age.

What are the potential tax benefits available to Valero Energy Corporation employees when contributing to their retirement plans? Could you elaborate on the current tax implications for contributions made in 2024 and any changes to tax credits or deductions that may impact employees' decision-making regarding their retirement savings?

Tax Benefits for Contributions: Employees contributing to Valero's retirement plans in 2024 can benefit from immediate tax deductions on traditional 401(k) contributions or tax-free growth on Roth contributions. The specific tax implications can influence employees' contributions depending on their current tax situation and future expectations.

How does Valero Energy Corporation's retirement plan compare to those offered by other companies in the energy sector? Can employees access benchmarking data to assess whether their retirement benefits meet industry standards? What elements can employees evaluate when considering the adequacy of their retirement provisions at Valero Energy Corporation?

Comparison with Industry Standards: Valero strives to offer competitive retirement benefits compared to others in the energy sector. Employees might have access to benchmarking data through human resources, which can help them evaluate the adequacy of their retirement benefits relative to industry standards.

What are the processes involved for Valero Energy Corporation employees to initiate a withdrawal or distribution from their retirement accounts upon retirement? Are there particular forms or timelines that must be adhered to, and how does the company provide support during this transition?

Withdrawal or Distribution Processes: Upon retirement, Valero employees can initiate withdrawals or distributions from their retirement accounts by following specific procedures, which include completing certain forms and adhering to outlined timelines. The company provides support during this transition, ensuring that employees understand their options and the implications of their choices.

How can Valero Energy Corporation employees contact the human resources department to inquire about their retirement benefits and plans? Please detail the best avenuesâ€”whether through phone, in-person visits, or online portalsâ€”available to employees for addressing their retirement-related questions and concerns.

Contacting HR for Retirement Plan Inquiries: Employees can contact Valero's human resources department through various channels such as phone, in-person visits, or online portals to inquire about their retirement plans. This accessibility helps in resolving any questions or concerns regarding retirement benefits and planning.

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

Valero Energy is a leading independent petroleum refiner and marketer, providing energy products globally with a focus on operational excellence.

Valero Energy offers stock options to eligible employees. The stock options vest over time, providing long-term incentives.