Camden County, GA. Master. Item Number: Motions Implement a Group Short Term Disability Program through SunLife for County Employees

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1 Camden County, GA Master 200 East 4th Street, Courthouse Square P.O. Box 99 Woodbine, Georgia Item Number: Type: Regular Agenda Agenda Date: September 21, 2010 In Control: Board of County Commissioners Title: Proposal to implement a Group Short Term Disability Program (Employee Paid) Attachments 1. SunLife Proposal for Group Short Term Disability Program Title Proposal to implement a Group Short Term Disability Program (Employee Paid) Motions Implement a Group Short Term Disability Program through SunLife for County Employees Background Currently the County offers employees the opportunity to purchase individual short term disability insurance policies; however, a group policy would increase the advantages for both the employees and the County. Advantages for EMPLOYEES include: Lower rates Continuity of Coverage o Same elimination period for all participants o Same amount of income replacement for all participants (60%) Seamless Claims Administration o One claim for short-term and/or long-term event up to and including death No Pre-existing Condition Exclusions Full Maternity Coverage Advantages for the COUNTY include: Discount on the Stop Loss Policy (Approx. $9,600/year) Seamless Claims Administration o Carrier coordinates transition from short-term to long-term to death claim NOTE: Current employees will have the option to maintain their individual policies or participate in the group program. Staff Recommendation Approval of this item as presented Camden County, GA Page 1

2 Camden County Board of Commissioners

3 Quick Facts about this Proposal Presented To Camden County Board of Commissioners PO Box 99 Woodbine, GA SIC Code: 9111 Presented by Sun Life Financial Northpark Town Center 1100 Abernathy Rd, NE, Suite 550 Atlanta, GA Tel: Fax: Benefits Quoted Basic STD Proposed Effective Date November 1, 2010 Things to Know This quote shows a summary of proposed benefits, rates and underlying assumptions. It is not part of the group policy or a legal contract with Sun Life Financial or its affiliated companies. This proposal is valid for 60 days from and only for the proposed Effective Date. A copy of the current carrier s booklet is required at time of sale. This proposal is for fully insured, nonparticipating coverage that terminates at retirement, unless otherwise noted. The rates shown are subject to recalculation pending final enrollment, census data and review of any additional data requested in the proposal. Please review the assumptions for information about how the rates were derived. Producer Licensing All Sun Life Financial companies (SLF) require all producers using insurance quotes issued by the company for the purpose of soliciting, selling or negotiating insurance to be licensed both by the state where the prospective client is located and by any state where the solicitation, sale or negotiation of insurance occurs, if different. This requirement pertains to all forms of solicitation, sale or negotiation of insurance, including but not limited to, solicitation, sale or negotiation conducted in person, by telephone, by , by fax or otherwise. Producer Compensation All Sun Life Financial companies (SLF) may pay the selling broker, agency, or third party administrator compensation for the promotion, sale and renewal of the products and services offered in this proposal. In addition to our standard compensation arrangements, we may make additional cash payments or reimbursements to selling brokers in recognition of their marketing and distribution activities, persistency levels and volume of business. We encourage brokers and their clients to discuss what commission or other compensation may be paid in connection with the purchase of products and services from the company. This proposal is based on employee census information provided. Acceptance of the group and final rates will be determined in the Home Office based on actual enrollment and case experience if required. Terms and conditions of any coverage under the policy will be determined by all necessary final data and by underwriting rules, minimum participation requirements and policy provisions in effect on the date coverage begins. Page 1 of 8 SLPC /09 (exp. 06/11)

4 Short Term Disability Benefit Highlights We are pleased to offer income replacement with flexible plan designs and Return to Work incentives to help employers manage costs. Here are some highlights of our Short Term Disability coverage: Flexible and Fully-Insured Plan Designs: Employers appreciate our flexible Short Term Disability plan designs which all include an own occupation definition and full maternity coverage. Employers may select from a variety of options: W-2 preparation at no additional cost, employer FICA match, length of benefit durations, and length of elimination periods. Expert Claim Management: Using a team approach, medical, psychiatric, and vocational professionals actively manage Short Term Disability claims. Employers who buy both Short Term Disability and Long Term Disability can take full advantage of our innovative early intervention process and personalized Return to Work plans. Tiered Benefits: Employers can vary benefit payments over the duration of an employee s disability. Advice to Pay Plan: The SunAdvisor Plan includes active claim management and duration recommendations with a SunAdvisor -FMLA Solutions option which provides full-service Family & Medical Leave Act administration and expert handling of employee claims for self-funded employer-sponsored plans. Statutory Plans: We offer statutory plans in New York and New Jersey. Residual Disability Benefits: This option allows employees to satisfy the elimination period by combining days of total and partial disability. Partial Disability Benefits: This option allows employees to receive up to 100% of their pre-disability earnings when working part-time, giving them extra motivation to return to work as quickly as possible. Survivor Benefit: If an employee dies before the benefit duration ends, was disabled for at least 14 consecutive days, and was eligible to receive Short Term Disability benefits prior to death, a survivor benefit is payable in a lump sum to a surviving spouse or eligible child. First-Day Hospitalization: This option helps protect hospitalized employees by providing immediate benefits with no elimination period. Service Guarantees: We are pleased to offer a Short Term Disability Service Guarantee that covers the speed and accuracy of our claims processing, as well as how quickly we respond to our customers phone calls. In addition, we also include an overall satisfaction guarantee to ensure our customers are 100% satisfied with our service. Group Short Term Disability coverage is underwritten by Sun Life Assurance Company of Canada, Wellesley Hills, MA under policy form series 93P-LH Proposal for Camden County Board of Commissioners Quote #15 Page 2 of 8 SLPC /09 (exp. 06/11)

5 Short Term Disability Plan Design & Rates Plan 1 Short Term Disability Plan Design Eligible Employees: All Full-Time United States Employees working in the United States who are scheduled to work a minimum of 30 hours per week Class 1: Class Description All Employees Waiting Period: 30 days of employment Benefit Amount: 60.00% Maximum Weekly Benefit: $1,500 Injury Start Date: 1 day Sickness Start Date: 8 days First Day Hospitalization No Maximum Benefit Period: 13 weeks Partial Disability Benefit: Return To Work Zero Day Residual: No Pre Ex Limitation: None Contributions: Contributory Participation Requirement: 35.00% Employer Contribution %: 0.00% Short Term Disability Rates Age Band Eligible Employees Monthly Rate Estimated Volume Estimated Monthly Premium $0.564 $8,990 $ $0.635 $17,038 $1, $0.576 $21,418 $1, $0.432 $25,127 $1, $0.376 $17,631 $ $0.415 $14,763 $ $0.493 $15,152 $ $0.615 $19,579 $1, $0.692 $12,621 $ $0.601 $5,739 $ $0.631 $1,777 $112 Coverage Total Eligible Employees Total Estimated Volume Total Estimated Monthly Premium Total Estimated Annual Premium STD 402 $8,990 $8,465 $101,583 Rate Basis: Per $10 of Weekly Benefit Included in this plan: Sun Life s STD Standard Graded Scale broker commission scale. 12 month rate guarantee from the Effective Date Survivor Benefit Full maternity coverage Group Short Term Disability coverage is underwritten by Sun Life Assurance Company of Canada, Wellesley Hills, MA under policy form series 93P-LH Page 3 of 8 SLPC /09 (exp. 06/11)

6 Rehabilitation services Non-occupational Coverage will be continued for a period of 1 Month(s) during a layoff. Coverage will be continued for a period of 12 Month(s) during a leave of absence approved by the policyholder. Earnings Definition: Earnings are defined as the earnings reported by the employer immediately prior to the first date of disability. Earnings include deductions made for pre-tax contributions to a qualified deferred compensation plan, Section 125 plan, or flexible spending account. Earnings do not include commissions, bonuses, overtime or any other compensation. Group Short Term Disability coverage is underwritten by Sun Life Assurance Company of Canada, Wellesley Hills, MA under policy form series 93P-LH Page 4 of 8 SLPC /09 (exp. 06/11)

7 Short Term Disability Assumptions Standard Sun Life Financial contractual language is offered, including coverage for leave of absence, layoff or termination. This plan does not replace the statutory disability plan in any state. STD benefits may be reduced by statutory disability plan benefits. Sun Life requires a final census prior to point of sale and reserves the right to rerate the proposal upon verification of dates of birth, genders, salaries, and occupations. Verification of any potential mergers and acquisitions must be provided. This proposal assumes there is common ownership of the business units. All non-contributory plan designs assume the employer pays the entire premium and all benefits will be fully taxable. Recurrent or concurrent condition endorsement included Part-time, temporary, seasonal, leased, and contracted (1099) employees are not eligible to participate. Employees working abroad and foreign nationals are not eligible to participate. This proposal assumes there is no coverage currently inforce. Group Short Term Disability coverage is underwritten by Sun Life Assurance Company of Canada, Wellesley Hills, MA under policy form series 93P-LH Proposal for Camden County Board of Commissioners Quote #15 Page 5 of 8 SLPC /09 (exp. 06/11)

8 Eligibility and Termination Actively at Work Requirement: An employee must be actively at work on his/her effective date for coverage to become effective. If an employee is not actively at work on his or her effective date, coverage will not become effective until the employee is again actively at work. An employee who is not actively at work on the effective date solely because it is not a regularly scheduled work day will be deemed to be actively at work. Termination of Employee s Insurance An Employee will cease to be insured on the earliest of the following dates: the date this Policy terminates. the date the Employee is no longer in an Eligible Class. the date the Employee s Class is no longer included for insurance. the last day for which any required premium has been paid. the date the Employee retires, unless the employee is eligible for retiree coverage. the date employment terminates. Ceasing to be Actively at Work will be deemed termination of employment, except: o insurance will be continued for an Employee absent due to a disability during any period the premium is being waived and during the elimination period o the Policyholder may continue the insurance by paying the required premiums during a layoff or approved leave of absence, limited to the time period specified in the policy o insurance may be continued for up to 3 months of the Employee s paid vacation. the date the Employee requests, in writing, to have his insurance terminated. the date the Employee ceases to be Actively at Work due to a labor dispute, including any strike, work slowdown, or lockout. the date the Employee enters active duty in any armed service during a time of war (declared or undeclared). While this Policy is in force, the Policyholder may continue an Employee s coverage pursuant to the Family and Medical Leave Act of 1993, as amended or continue coverage pursuant to a state required continuation period (if any). While this Policy is in force, the Policyholder may continue an Employee s coverage pursuant to the Uniformed Services Employment and Reemployment Rights Act (USERRA). Termination of the Policy or Employer s Participation The policy or the employer s participation under the policy will terminate if: the required premium is not paid within the premium grace period. employee or dependent (if applicable) participation falls below the required levels * the employer fails to promptly provide information which we require or fails to perform obligations pertaining to the policy * the number of covered employees insured under the plan falls below ten * We will provide written notice to the employer at least 30 * days in advance of coverage termination for reasons other than premium non-payment (45 days or 60 days advance notice will be given where required by applicable state law) If the employer requests cancellation, coverage will terminate on the first premium due date after we receive written notice. Page 6 of 8 SLPC /09 (exp. 06/11)

9 Disclosures Short Term Disability Limitations No STD benefit will be payable for any disability during any of the following periods: any period the Employee is not under the regular and continuing care of a Physician providing appropriate treatment by means of examination and testing in accordance with the disabling condition. any period the Employee fails to submit to any medical examination requested by Sun Life. any period the Employee engages in any occupation or employment for wage or profit, if Partial Disability in not included in the plan. any period of Total Disability due to Mental Illness, unless the Employee is under the continuing care of a specialist in psychiatric care. any period of Total Disability due to Drug and Alcohol Illness, unless the Employee is actively supervised by a Physician or Rehabilitation Counselor and is receiving continuing treatment from a rehabilitation center or a designated institution approved by Sun Life. if a pre-existing condition limitation applies to the plan, then any period of Disability that occurs within the exclusionary period and is caused by, contributed to by, or resulting from a Pre-Existing Condition. A Pre-Existing Condition means any Injury or Sickness for which the Employee has received medical treatment, consultation, care or services, including diagnostic measures, or took prescribed drugs or medicines within the look back period prior to his Effective Date of Insurance. This exclusion will not apply if the Employee s Disability begins after the end of the exclusionary period. In addition, if the exclusion includes a treatment free period, the exclusion will not apply if the Employee s Disability begins after a period of consecutive treatment free months after the Employee's Effective Date of Insurance, during which he has not received medical treatment, consultation, care or services, including diagnostic measures, or taken prescribed drugs or medicines. Exclusions No STD benefit will be payable for any Total Disability that is due to: intentionally self-inflicted injury. war, declared or undeclared, or any act of war. active participation in a riot, rebellion or insurrection. committing or attempting to commit an assault, felony or other illegal act. Injury or Sickness for which the Employee is entitled to benefits under any Workers' Compensation, Occupational Disease or similar law, if coverage type is nonoccupational. Injury or Sickness sustained while doing any act or thing pertaining to any occupation for wage or profit, if coverage type is non-occupational. Termination of Short Term Disability Benefits Total Disability Benefits will cease on the earliest of: the date the Employee is no longer Totally Disabled, or Partially Disabled if Partial is included in the plan; the date the Employee dies; the end of the Maximum Benefit Period; the date the Employee fails to provide proof of continuing Disability as requested; or Page 7 of 8 SLPC /09 (exp. 06/11)

10 the date Sun Life determines the Employee is able to perform all of the material and substantial duties of his own occupation, even if the Employee chooses not to work. Page 8 of 8 SLPC /09 (exp. 06/11)