Department of Civil Service

NY08-25

TO: Benefits Administrators of State Agencies
FROM: Employee Benefits Division
SUBJECT: Management/Confidential Group Life Insurance Plan Annual Update
DATE: July 17, 2008

We are preparing the 2008 annual update of the Management/Confidential (M/C) Group Life Insurance Plan enrollment records.  The update will be processed through NYBEAS.

Parts of the update process are automatic, while others require your action.  It is important that you inform your enrollees of the annual update and of any changes in their coverage and/or payroll deductions.  Equally important is that you encourage enrollees to review their beneficiary designation(s), the continued eligibility of dependents (particularly child coverage), and smoker/nonsmoker status.  This is also an opportune time to inform enrollees planning to retire in the near future that their life insurance benefits are not cancelled automatically at the time of their retirement.  Their coverage will continue at the same level unless we receive a written request from them indicating that they wish to cancel. 

A sample notice is enclosed to give to employees or post on bulletin boards.

RATE SCHEDULE

Effective September 1, 2008, the rates for Personal Life rates will be reduced by 25%, and AD& D will be reduced by 50%.  There will be no rate change for Dependent Life and Accident and Sickness coverage.

AUTOMATIC CHANGES

The annual update will automatically produce a change in payroll deductions for:

• Any enrollee who has reached a higher five-year premium age bracket as of September 1, 2008     
• Any enrollee whose age as of September 1, 2008, requires a reduction in coverage, and
• Any enrollee covered at a multiple of annual salary whose salary has changed by an amount sufficient to affect the total amount of coverage.

SALARY/COMPENSATION USED IN CALCULATIONS

Updated life insurance coverage for enrollees who have chosen a multiple of salary option for their coverage amount is based upon the annual salaries as reported by the Office of the State Comptroller (OSC) on the following payrolls or by the Benefits Administrators:

Administration Payroll checks dated July 09,2008
Institution Payroll checks dated July 17, 2008

Enrollees whose salaries change between the dates above and September 1, 2008 should request an adjustment in their coverage to reflect the salary change.  The enrollee must submit a copy of his/her paycheck stub to the Benefits Administrator showing the new annual salary no later than September 30, 2008.  The Benefits Administrator must forward the request, with a copy of the payroll stub, to the Employee Benefits Division, M/C Life Insurance Unit no later than October 31, 2008.

Additional compensation paid on a permanent basis, such as location pay, geographic differential, or special allowance, will be included in the annual salary.  However, items such as shift differential, overtime pay, and maintenance adjustments may not be considered salary for life insurance purposes.

Please Note:
Enrollees requesting to increase or decrease their multiple of salary option must fill out a PS-934, M/C Life Insurance Transaction Form, check the “Change in Coverage” box in item 14, and select one of the options in item 15 that is either greater or less than their current option choice.  (The maximum allowable coverage option is five times salary, with a maximum of $500,000).  Any increase in coverage request requires that the enrollee mail a completed Statement of Health form to MetLife.

AGE-RELATED REDUCTIONS IN COVERAGE FOR ACTIVE EMPLOYEES

For active employees who are insured for a multiple of salary,

At age 65-69, the coverage available will be 65% of the coverage available to the enrollee if the enrollee were under 65;

At age 70-74, the coverage available will be 45% of the coverage available to the enrollee if the enrollee were under 65;

At age 75-79, the coverage available will be 30% of the coverage available to the enrollee if the enrollee were under 65;

At age 80 and over, the coverage available will be 20% of the coverage available to the enrollee if the enrollee were under 65.

However, in no case will the coverage be reduced below $15,000.

AGE-RELATED REDUCTIONS IN COVERAGE FOR RETIREES

For retired enrollees who are insured for a multiple of salary,

At age 65-69, the coverage available will be 65% of the coverage available to the enrollee if the enrollee were under age 65 (but not less than $15,000).

At age 70 and over, the coverage will be reduced to $15,000.

ACCIDENTAL DEATH AND DISMEMBERMENT COVERAGE

All active employees, regardless of age, and those retirees under age 70 who retired after September 1, 1992, will be covered for Accidental Death and Dismemberment (AD&D) benefits equal to their life insurance coverage but not above $250,000.  Individuals who retired prior to September 1, 1992, are covered for AD&D benefits equal to their life insurance coverage but not above $150,000.  Retired enrollees, at age 70 and over are not eligible for AD&D.

SMOKER/NONSMOKER CHANGES

Individuals previously enrolled as “smokers” who have not smoked since September 1, 2007, may now apply for the special nonsmoker premium discount.  To apply for nonsmoker status, enrollees must complete a PS-934, Management/Confidential Group Life Insurance Transaction form, check “Other” in block 14 and complete the entire application form before submitting it to their agency Benefits Administrator.  These forms must be submitted to you by September 30, 2008 and forwarded to and received by the M/C Life Insurance Unit by October 31, 2008.

EFFECTVE DATES OF PREMIUM CHANGES/COVERAGE AMOUNTS

Effective dates of new payroll deductions and changes in the amount of life insurance coverage for employees on the OSC payroll system will change automatically on the Institution and Administration paychecks dated as follows:

Institution Lag Payroll checks dated September 11, 2008; coverage will become effective at 12:01 a.m. September 11, 2008;

Administration Lag Payroll checks dated September 3, 2008; coverage will become effective at 12:01 a.m. September 4, 2008; and

Administration Current Payroll checks dated August 20, 2008; coverage will become effective at 12:01 a.m. September 4, 2008.

AGENCY AND INDIVIDUAL UPDATE NOTICES

In mid-August 2008, State agencies will receive a printout showing the updated status for each enrollee.  If you have any questions please call the M/C Life Insurance Unit at (518) 473-3496.

2008 ANNUAL UPDATE OF M/C GROUP LIFE INSURANCE PLAN

GENERAL INFORMATION FOR ACTIVE ENROLLEES

SMOKER/NON-SMOKER STATUS
If you are enrolled as a “smoker” but you have not smoked since September 1, 2007, you may apply at this time for the non-smoker rate. To take effect this year, a written request must be submitted to your Benefits Administrator by September 30, 2008.  (Your status is listed below your name in the coverage update box of your 2008 M/C Life Insurance update notification).

BENEFICIARY
Have you reviewed your beneficiary designation? Your beneficiary designation should be updated periodically to ensure that we have current addresses on file for all of your beneficiaries.  If you would like to update your designation, contact your Benefits Administrator and request a beneficiary designation form.

RETIREMENT
If you retire, your M/C Life Insurance coverage will continue at the same level in effect prior to your retirement, unless a written request is received by you requesting that your coverage be reduced or cancelled.   Your life insurance coverage is not automatically cancelled upon retirement.

CHILD COVERAGE
If you have coverage for a dependent child, please be sure to check your child’s continued eligibility.  A child is eligible for dependent life coverage only if he or she is your natural or adopted child or stepchild, is unmarried and over 14 days but under 19 years of age, or a full time dependent student at an accredited school, under age 25. (Up to 4 years spent in military service may be subtracted from child’s age for purposes of determining maximum age for dependent student eligibility.)

Disabled dependent(s) - Your unmarried children age 19 or over are eligible provided they are incapable of supporting themselves because of a mental or physical disability acquired before coverage would otherwise have ended.  An approved Disability Form PS-451 must be on file for disabled dependents over age 19 to be covered.

When you no longer have an eligible dependent child, please notify your agency Benefits Administrator.  You will be provided with the forms to complete in order to delete your dependent child coverage and adjust your premium. Upon the loss of eligibility, your child may be entitled to convert to an individual policy with Metropolitan Life without proof of insurability.  If you wish to exercise this conversion privilege, request a conversion form from your Benefits Administrator.

REDUCTION IN COVERAGE
On the September 1st after you reach age 65, 70, 75 or 80, your multiples of salary coverage amount will be reduced as indicated below. Coverage will not be reduced below $15,000. If after the reduction is applied your coverage is not an even $1,000, it will be rounded up to the next higher thousand.

If you wish to convert the amount of coverage lost to a private policy, your Benefits Administrator can provide you with a conversion form. If your coverage is reduced, your spouse’s coverage may also be reduced.  Spouse coverage is limited to 50% of the enrollee’s coverage or $20,000, whichever is less. 

ACCIDENTAL DEATH and DISMEMBERMENT (AD&D) COVERAGE
You are covered for AD&D coverage equal to the amount of your personal life insurance with a maximum amount of $250,000. This benefit is affected by mandatory age reductions at 65, 70, etc. As long as you work, you will be covered for AD&D. For enrollees choosing a multiple of salary option facing mandatory age reductions, AD&D coverage will not go below $15,000; this is similar to your personal life insurance benefit. If you retire, and your age is 70 or older, your AD&D ceases.

EFFECTIVE DATES OF PREMIUM CHANGES/COVERAGE AMOUNTS
Effective dates of new payroll deductions and changes in the amount of life insurance coverage for employees on the OSC payroll system will change automatically on the Institution and Administration paychecks dated as follows:

Institution Lag Payroll checks dated September 11, 2008; coverage will become effective at 12:01 a.m. September 11, 2008;

Administration Lag Payroll checks dated September 3, 2008; coverage will become effective at 12:01 a.m. September 4, 2008; and

Administration Current Payroll checks dated August 20, 2008; coverage will become effective at 12:01 a.m. September 4, 2008.

PREMIUM RATE SCHEDULE

BIWEEKLY RATE SCHEDULE - RATES EFFECTIVE SEPTEMBER 1, 2008
EMPLOYEE LIFE AND AD&D

* Maximum AD&D Benefit is $250,000
** Equal to 50% of enrollees coverage with a maximum of $20,000
*** This $0.23 premium cost provides $4,000 coverage for each eligible child