Group Income Continuance Plan. for staff of Dublin City University (DCU) A guide to protecting your income

Transcription

1 Group Income Continuance Plan for staff of Dublin City University (DCU) A guide to protecting your income

2 contents Protecting your salary Introduction... Why you need the DCU Group Income Continuance Plan...4 Perhaps the greatest threat to your livelihood is ill health How the Plan works...5 Affordable for every member Cost of the Plan... 6 Additional protection for you and your family... 7 If you fall ill your sick pay provides you with an income for a limited period only. Once your sick pay runs out, your income will fall dramatically. How would you and your family cope financially if you suffered a serious illness or disability? The Group Income Continuance Plan for DCU staff members, administered by Cornmarket, provides members with the financial security they deserve. It has grown to become an important benefit for many members already enjoying the protection the Plan provides. How to join...7 Please don t risk your future financial security. If you haven t already joined I would urge you to consider doing so now. Frequently asked questions...8 Joining the Plan...0 Ivan Ahern Director, Cornmarket Terms of employment... Calculation of benefit...4 Tax relief Other common questions... Death benefit...4

3 Introduction introduction Representing you Gregan McGuinness has been administering the Group Income Continuance Plan for DCU staff members since 985. Now as part of the Cornmarket Group, Gregan McGuinness have built up a large team of experts whose role is to act on behalf of members. The Plan helps guarantee a realistic level of income in the event of loss of salary through illness. This includes: Negotiating with the insurers (currently Friends First) to obtain the most competitive rates and to secure the best possible benefits Assisting members who wish to make a claim from the Plan by guiding them through every stage of the claims process and acting as the members advocate Promoting the Plan to DCU staff members Through its various Group Income Continuance Plans, Cornmarket has helped protect the financial security of more public sector employees than any other company in Ireland. But the real testament to the quality of these plans is the amount being paid out to beneficiaries, which is now counted in hundreds of millions of Euro. Here s what two people who ve already benefited from Cornmarket s Group Income Continuance Plans have to say The Plan in action I was in the Plan for over 0 years... at the time I expected to get better and when I didn t I have to say reality came home to me, because I have a wife and children... then the Plan kicked in, and certainly we wouldn t have been able to manage without it. That s the bottom line... I certainly didn t want to leave the job, if I could have had a way around it at the time I certainly would have stayed... I know the Plan works and I wouldn t like to see anybody in the situation I was in... there is no reason, no logical reason why any member of staff shouldn t join the Plan at any stage along the way because it is a benefit, a huge benefit. Pat Ryan, Plan Beneficiary, Co. Laois It s bad enough having to give up your work through illness. Just think what your life would be like if there was no salary coming through that door. If I hadn t got the money coming into me every month, I wouldn t be able to pay the mortgage, I wouldn t have the car that I need, I wouldn t be able to finance my kids doing what they re doing at the moment, I wouldn t have any holidays. I wouldn t have any hope for the future. Margaret Carolan, Plan Beneficiary, Co. Wicklow introduction

4 4 Why you need the DCU Group Income Continuance Plan Why you need the DCU Group Income Continuance Plan Although many people feel that they will never need the protection the Plan provides, sadly our experience has been that even the healthiest person can suffer unexpected illness or, of course, have a serious accident. This is why membership of the Plan is so vital for every DCU staff member. What happens to your income if you fall ill? DCU staff may be eligible for sick pay entitlements of 6 months full pay, 6 months ½ pay in a rolling 4 year period, calculated on a pro-rata basis. Therefore if you are an employee with full sick pay entitlements and are absent from work due to ill health for more than 6 weeks during any period of months your pay is cut by half. Once you have been ill for a full 5 weeks over a period of 4 consecutive years, you are taken off the payroll altogether! What happens when your sick pay runs out? If you have been contributing to the Superannuation Scheme for more than five years and there is a reasonable expectation that you will return to work, pension rate of pay may be paid for a limited period. Alternatively if you are forced to retire on grounds of ill health you may be entitled to an Ill Health Early Retirement Pension (ERP) at this point. Either way, even if you have many years of service, your ERP/pension rate of pay will only be a fraction of your pre-disability salary. In addition, those paying PRSI at the A rate may be entitled to a Social Welfare Illness Benefit but, at 0,660 a year (009 level), this provides a subsistence income only. The reality is that long-term illness inevitably means a severe drop in living standards. How the Plan works In a nutshell, the Plan aims to pay members a benefit of up to 75% of the salary they were earning before they fell ill, less any Early Retirement Pension (ERP)/pension rate of pay and/or Social Welfare Illness Benefit to which they were entitled. If you have been taken off the payroll Once you have exhausted your sick pay in accordance with your sick pay rules (typically this would be 5 weeks in any 4 year period), the Plan aims to pay you a benefit of 75% of the salary you were earning before you fell ill less any Early Retirement Pension/Pension rate of pay and/or Social Welfare benefit to which you may be entitled. If you do not retire (perhaps because of anticipated recovery of your health) you will obviously not be entitled to claim an Early Retirement Pension (ERP). Therefore in such cases provided you have not been granted pension rate of pay from your employer, Friends First (the insurer) will consider paying a benefit equivalent to 75% of salary (less any Social Welfare Illness Benefit if applicable) for a maximum of years if there is a reasonable expectation that you will return to work. This means that over the year period, no deduction will be made for an Early Retirement Pension as no Early Retirement Pension is being paid. If your pay has been reduced to half pay It may be the case that you have not been taken off the payroll but that your pay has been reduced to half pay (typically this may be after 6 weeks in any month period). In this situation, the Plan aims to pay you an income of 5%, topping up your sick pay to 75%. The Plan goes on paying you until you recover, are deemed fit to return to work by Friends First, die, or right up to your 65th birthday if you are permanently disabled (see page Q5: When does my membership end?). Claims under the Plan will be paid if Friends First, the Plan s insurer, is satisfied that because of injury or illness you are totally unable to carry out your normal job. 00% 00% 96 p.w. 96 p.w. An example of what happens when sick pay runs out 75% 50% An example of how the Plan helps 75% 50% 40 p.w. 46 p.w. Sick Pay Plan Benefit ERP/Pension rate of pay/social Welfare 5% 0% First 6 weeks of illness Sick pay totals 00% of salary 48 p.w. Second 6 weeks of illness Sick pay totals 50% of basic salary 60 p.w. After 5 weeks of illness 7% of pre-disability salary if entitled to ERP/pension rate of pay 5% 0% First 6 weeks of illness Sick pay totals 00% of salary 48 p.w. Second 6 weeks of illness Sick pay plus Plan benefit totals 75% of basic salary 60 p.w. After 5 weeks of illness Plan benefit totals 75% of pre-disability salary less ERP/pension rate of pay How the Plan works Examples are based on a full time member earning 50,000 p.a. ( 96 p.w.) with 5 years of service paying PRSI at the lower D rate, who is now unable to work due to a long-term illness.different benefits apply for those paying PRSI at the A rate. 5

5 6 Cost of the Plan Cost of the Plan How much does it cost? Very little! As membership is so vital, the Plan is designed to be affordable for every member. It's remarkably good value because it s negotiated on a special group basis for DCU staff members. The contribution rate is currently set at just.5% of salary (guaranteed until June 0) and is conveniently deducted from your salary by your employer. Please bear in mind that it is your responsibility to ensure that the correct deductions have in fact been made by your employer and that deductions are cancelled where appropriate. Plan Cost Disability Benefit Death Benefit Total cost.09% of salary 0.4% of salary.50% of salary Additional protection for you and your family Death Benefit Should you die the issue of financial support may be even more pressing for your family. Mortgage payments, day-to-day living expenses, credit card bills, etc. will still have to be met by those you have left behind. The Plan recognises this fact by providing an important benefit in the form of Death Benefit equivalent to twice your annual salary which is paid to your estate should you die. As with your disability benefit, this Death Benefit is salary linked so it rises each year in line with your salary. All members of the Group Income Continuance Plan are now covered for Death Benefit unless they decided not to join it when this benefit was introduced in June 008. All members will automatically enjoy this benefit regardless of their state of health. What happens at retirement? Our experience has been that the vast majority of members still need some element of cover even after they retire. For this reason, we have designed the Plan so that members are entitled to join the Retired Members Life Cover Plan on retirement without having to undergo any medical underwriting. This provides for the payment of a tax-free lump sum to your estate on your death. Therefore, for a modest monthly contribution, members will benefit from the Death Benefit provided by the Retired Members Life Cover Plan (for full details please see page 5: Can my death benefit remain in force after I retire?) The cost of the new Death Benefit is considerably less than the premium the member would pay for a similar level of cover by way of an individual life assurance policy. See the chart below for details. A helping hand from the Revenue! You are eligible for tax relief at your highest rate of tax on your contribution to the plan. This means for most staff members the cost of membership is only to 5 a week after tax a small price to pay for peace of mind. Who is eligible? Example Salary 60,000 70,000 80,000 Weekly contribution Real weekly contribution after tax/prsi relief Contribution for a full time member paying PRSI at the lower D rate and paying income tax at 4% (May 009). To be eligible for membership of the DCU Plan you must be under age 65, employed in a pensionable employment, and a staff member in Dublin City University (DCU). DCU Death Benefit vs. Typical Individual Policy Age Benefit Cost of an Cost of the DCU next birthday Salary x Salary Individual Policy p.m.* Group Policy p.m. (net cost)** Males 5 60,000 0, ,000 40, ,000 60, Females 5 60,000 0, ,000 40, ,000 60, Source of individual policies, Advisor Plus, Feb 009 * Unlike the DCU Group policy, individual policies do not qualify for tax relief so the prices listed are gross ** Assumes tax relief at 4% and PRSI relief at 4.9% at the lower D rate How do you join? If you haven t already joined the Plan, don t put it on the long finger! Apply to join by calling Cornmarket on (0) Cover begins when Friends First accepts you as a member of the DCU Group Income Continuance Plan. Additional protection for you and your family 7

6 8 Frequently asked questions Frequently asked questions Joining the Plan How are new members of staff treated?... 0 How do existing DCU staff who are not members of the Plan join?... 0 Who is eligible to join?... When does my membership begin?... When does my membership end?... Are all applications accepted?... What does it mean if my application is subject to exclusions, or even refused?... Terms of employment What if I have a second job?... Calculation of benefit On what salary is my cover based?...4 Does it affect my benefit under the Plan if my disability is due to an injury at work?...4 Does my cover increase in line with my rising salary?...4 If I am claiming from the Plan, does the amount I receive increase each year?...4 Does my Pensionable Service with my employer continue to accrue while claiming benefit from the Plan?...4 What if I already have some form of income continuance?...5 Will I receive money back if I never claim under the Plan?...5 How do I claim from the Plan?...6 A step by step guide on how to claim...6 How disabled do I have to be to qualify for benefit under the Plan?...0 Who decides whether or not I am fit to work?...0 Are there any exclusions under the DCU Plan?...0 Are claims ever turned down by the insurer?...0 When does benefit payment under the Plan begin?... For how long will I be paid benefit under the Plan?... Other common questions What happens if I cancel my membership?... Under what circumstances can the Plan be amended?... Who administers and insures the DCU Group Income Continuance Plan?... Death Benefit What Benefit is paid on death?...4 Can my Death Benefit remain in force if I claim under the Disability Benefit?...4 Can my Death Benefit remain in force after I retire?... 5 What if I have unearned income?... What if I take a Leave of Absence?... What are the maximum benefits paid under the Plan?...5 Do I have to pay my contributions if I am claiming from the Plan?... What if I leave DCU?... What happens if I change my terms of employment or my normal occupation?... What if I take unpaid parental, maternity or adoptive leave?... What if I take unpaid leave to take care of a dependant relative?... What if I am a term timer?... What if I travel abroad?...4 Is my benefit affected by the PRSI contribution I pay?...4 What benefits does this Plan provide for job sharers and work sharers/ reduced hours?...5 Tax relief Do I have to pay tax on benefits from the Plan?...5 How do I claim my tax relief on contributions?...5 What happens if my claim is rejected?... If it is decided I am no longer disabled, is my benefit stopped immediately?... What happens if I return to work only to find that I become ill again a few months later?... What happens if I return to work but at a reduced salary or take up a different less well paid job?... What if I am disabled while on leave of absence?... Frequently asked questions 9

7 0 Joining the plan Joining the Plan How are new members of DCU staff treated? Membership of the Group Income Continuance Plan is automatic from the date of commencement of pensionable employment. How do existing DCU staff who are not members of the Plan join? Existing staff who are not already in the Group Income Continuance Plan can join by completing an application form available from Cornmarket. When completing your application form you must answer the following questions: Have you been absent from work through illness or injury for more than 0 consecutive working days in the last three years (colds or influenza may be ignored)? Yes No Are you currently unwell or do you suffer from any physical defect or is there any ailment or disease to which you have a tendency? Yes No Are you currently taking prescribed drugs, medicines, tablets or other treatment or have you done so in the last year (colds, influenza or respiratory tract infections may be ignored)? Yes No Have you been referred to a specialist or admitted as an in-patient to any hospital or clinic in the last four years (in-patient periods in respect of normal pregnancy and delivery need not be disclosed)? Yes No Have you ever had any symptoms of, or suffered from any of the following: Depression, anxiety, nervous breakdown or mental disorder? Yes No Have you ever had any symptoms of, or suffered from any of the following: Lumbago, slipped disc, whiplash, or back trouble? 7 Have you ever been declined, postponed or accepted on special terms by Friends First or any other insurer for life, critical illness or disability insurance? You understand that it is a condition of membership that you accept that DCU may amend the terms of the DCU Plan or terminate the DCU Plan altogether and that any decisions Are all applications accepted? Yes No made by DCU in such matters are binding on all members In addition you must sign your application form to confirm your acceptance of the following conditions: You wish to join the DCU Income Continuance Plan and that you are actively at work, or capable of being actively at work on the date of signing the proposal You understand that failure to disclose a material fact my constitute grounds for rejection of a claim You consent to Friends First seeking information from any doctor who at any time has attended you and from any insurance office to which at any time a proposal for insurance of any kind on your life or health has been made and you authorise the giving of such information You understand that this and any other declaration made in connection with this proposal (including statements to a medical examiner in connection with your proposal or statements made to Friends First s underwriting team in response to any phone calls received) shall be the basis of the proposed contract between you, Friends First and DCU You confirm that you are a staff member of DCU (it is a condition of the Plan that you must be a staff member of DCU) You understand that Friends First must be notified of any changes in your health and/or circumstances prior to the date Friends First accepts you into the Plan and that the insurance shall not commence until this application has been accepted by Friends First You realise that if your proposal for insurance is declined or offered on special terms this fact will be noted on a register administered by the Irish Insurance Federation and may be shared with other insurance companies as a protection against non-disclosure of material facts 4 5 You acknowledge that you have received and understand the contents of the Cornmarket Terms of Business document. Who is eligible to join? To be eligible to apply for membership of the DCU Group Income Continuance Plan you must be: Under age 65 and A staff member of Dublin City University (DCU) who is employed in pensionable employment. When does my membership begin? Your cover begins from the date Friends First accepts your application to the Plan. All Staff members who commenced employment in DCU since the st March 998 are automatically accepted to the DCU Group Income Continuance Plan from the date pensionable employment began. Members receive a formal acceptance letter confirming they have been included as members of the DCU Group Income Continuance Plan. In some cases medical evidence may be required before membership of the Plan can be confirmed. This may involve providing further details over the telephone or attending a medical examination at Friends First s expense. When does my membership end? Membership of the Plan ends: If you no longer fulfil the eligibility requirements as set out or If your contributions to the Plan cease (please bear in mind that the responsibility to ensure that the correct contributions to the Plan are paid rests with you). It is important to remember that Cornmarket may not be notified by your employer when you retire. It is vital therefore that you notify Cornmarket at least 8 weeks in advance of your retirement date so that we can stop contributions to the Plan. 6 7 In a small percentage of cases, membership of the Plan may be refused. In such cases, applicants will receive a letter confirming that they have not been accepted into the Plan. In other cases, membership may be offered subject to the condition that certain specified illnesses are excluded from cover or subject to the payment of an additional contribution. What does it mean if my application is subject to exclusions, extra premium, or even refused? This means that Friends First believe they cannot, because of your health history, offer you the cover sought or they believe it is necessary to charge an extra premium, exclude certain conditions or restrict the level of cover. Friends First make such decisions only after careful consideration of the information supplied by you on your application form together with any details they have received from doctors you have attended. Applicants may seek additional clarification from their own doctor who can contact Friends First to request reasons for their decision. Joining the plan Yes No

8 Terms of employment A Terms of employment What if I have a second job? This may be taken into account in calculating any benefit paid should you make a claim from the Plan. It is vital, therefore, that you notify Cornmarket in writing at the time of joining the Plan if you have a second job. Likewise you should notify Cornmarket in writing if, after joining the Plan, you take on a second job. In the event that you have a second job at the time of joining the Plan or take on a second job after joining the Plan, Friends First reserves the right to refuse cover or withdraw cover in respect of your normal job. This could happen where, for instance, Friends First believes that your second job involves a greater degree of risk than that involved in your normal job. The cover provided by the Plan does not extend to your second job. If you would like disability cover on your second job you should contact Cornmarket about the possibility of insuring yourself against disability through an individual policy. What if I have unearned income? In general, investment and rental income will not be taken into account when making a claim under the Plan. Benefit from any accident or sickness policy may however be taken into account except benefits paid under a critical/serious illness policy. What if I take a Leave of Absence? You may avail of options A to C for a maximum period of months. Generally, members of the Plan who take a Leave of Absence fall into one of the following categories Members who wish to continue the Death Benefit element of their cover and wish to re-activate their membership of the disability element of the Plan on completing their Leave of Absence without having to undergo any medical underwriting. If you are in this category you may apply within two months of taking a Leave of Absence for immunity from medical underwriting. This will allow you to re-activate your Disability Benefit under the Plan before a specified date when your Leave of Absence is over without the need for medical underwriting. To secure immunity from medical underwriting you must pay a reduced contribution of ⅓% of the normal contribution for Disability Benefit. To maintain the Death Benefit in force you must pay 00% of the contribution B C for Death Benefit. These payments are based on your pre-leave of Absence salary and must be paid annually in advance during your Leave of Absence. The level of the Death Benefit during the Leave of Absence will be based on your salary on the date you started your Leave of Absence. Members who do not wish to continue either the Disability or Death Benefit element of their cover but who wish to re-activate their membership on completing their Leave of Absence without having to undergo any medical underwriting. If you are in this category you may apply within two months of taking a Leave of Absence for immunity from medical underwriting. This will allow you to re-activate your membership of the Plan before a specified date when your Leave of Absence is over without the need for medical underwriting. To secure immunity from medical underwriting you must pay a reduced contribution of ⅓% of the normal contribution for Disability Benefit and ⅓% of the contribution for Death Benefit. These payments are based on your pre-leave of Absence salary and must be paid annually in advance during your Leave of Absence. Members who wish to continue their full cover under the Plan for the duration of their Leave of Absence because they are taking up alternative employment. If you are in this category you may apply within months of taking a Leave of Absence to transfer benefits similar to those you enjoyed under the Plan to any new job. This is however at Friends First s discretion and subject to your new job being acceptable to Friends First from an underwriting point of view, e.g. that your new job does not involve a greater degree of risk than that in your normal job. Naturally the rate and amount of your contribution and benefit level will be determined by your pre-leave of Absence salary as you will no longer be an active member of the Plan. You should remember to notify Cornmarket on taking up your normal job at the end of your Leave of Absence if you wish to re-activate your membership of the Plan. The level of cover applying when you take up your membership again may be higher than that you enjoyed while on your Leave of Absence. D Members who simply decide to discontinue membership of the Plan. If you are in this category, or do not notify Cornmarket of your intention to take a Leave of Absence, your cover under the Plan will cease as soon as your salary stops. Thereafter you must complete a full medical application form and undergo medical underwriting should you wish to rejoin the Plan upon returning to work. What if I leave DCU? In such circumstances you are no longer eligible for membership of the Plan. You should therefore write to Cornmarket to cancel your membership. Cornmarket may, depending on your circumstances, be able to offer you an individual policy providing similar cover. What happens if I change my terms of employment or my normal occupation? If your terms of employment change, this may affect your cover under the Plan. For instance, if you reduce the overall number of hours you are working each week your benefits under the Plan may be affected. Similarly if you change your job to one that may involve a greater degree of risk from an underwriting point of view it is vital that you notify Cornmarket in writing. What if I take unpaid parental, maternity or adoptive leave? If you avail of your entitlement to take unpaid Parental, Maternity or Adoptive Leave, and are making your contributions to the Plan through salary, no contributions will be collected in respect of periods for which you are on leave as you will not be paid a salary while on leave. Nonetheless your cover will continue unaffected while you are on leave and no repayment of the skipped contributions will be sought. However this is subject to the period of unpaid leave being no longer than 8 weeks in total in any month period. Where the period of leave is more than 8 weeks in total in any month period, members should contact Cornmarket for details of their options. These will be similar to those available to members who take a Leave of Absence. 7 8 What if I take unpaid leave to take care of a dependant relative? If you avail of your entitlement to take unpaid Carer s Leave, and are making your contributions to the Plan through salary, no contributions will be collected in respect of periods for which you are on leave as you will not be paid a salary while on leave. Nonetheless your cover will continue unaffected while you are on leave and no repayment of the skipped contributions will be sought. However, this is subject to the period of leave being no longer than 8 weeks in total. Where the period of leave is more than 8 weeks, members should contact Cornmarket for details of their options. These will be similar to those available to members who take a Leave of Absence. What if I am a term timer? Typically term timers work 9 months of the year and take unpaid leave for the months of June, July and August. They have two options regarding their pay: Be paid as normal for the 9 months they are working or Spread their salary over the full twelve months of the year i.e. instead of taking 00% of their salary for 9 months and nothing for the remaining three months, take 75% of salary each month for the months of the year. Your actual salary will typically be 75% of the salary you would have received were you still working a full twelve months. DCU have agreed to deduct this premium based on the equivalent full-time salary from the term time salary and so benefit based on the full-time salary will be paid in the event of a claim. However, for those who work in a term timer capacity on a regular basis (i.e. over each year for periods of more than two years) cover under the Plan remains in force with benefit based on the actual salary (typically 75% of equivalent full-time salary) you were receiving over the previous month period. Terms of employment

9 4 Calculation of benefit 9 0 What if I travel abroad? As long as you remain resident within Ireland, you are covered wherever you travel in the world for holiday purposes. However, should you decide to reside abroad or work abroad temporarily, you should notify Cornmarket immediately as Friends First reserve the right to vary your contributions or benefits or cancel membership of the Plan in such circumstances. Is my benefit affected by the PRSI contribution I pay? No. Many members are paying PRSI contributions on the lower D PRSI rate and so pay less PRSI than those members on the A PRSI rate. If a member paying PRSI at the D rate retires on an ill health Early Retirement Pension (ERP) under the Superannuation Scheme he or she is not entitled to any Social Welfare Disability Benefit. On the other hand, members paying the higher A PRSI rate may be entitled to a Social Welfare Disability Benefit if they suffer prolonged illness. Members in this situation may also be entitled to an ill health Retirement Pension. Calculation On what salary is my cover based? If, like most members you are making your contributions to the Plan through salary, your cover and contributions are based on the salary you receive from your employer. The level of cover you enjoy and the amount of contribution you pay will be increased periodically (see question below: Does my cover increase in line with my rising salary? for details). Your income will be calculated on your pensionable salary at the end of the deferred period excluding bonuses, commissions, overtime and any other fluctuating emoluments. Does it affect my benefit under the Plan if my disability is due to an injury at work? Yes. If you are injured at work, depending on the circumstances, social welfare benefits, etc., you may be entitled to payments in excess of 75% of salary. In such cases, as you would already be receiving a payment greater than 75% of your pre-disability salary, you would not be entitled to any benefit under the Plan. of benefit 6 7 What if I already have some form of income continuance? If you already have an Income Protection or permanent health insurance policy you should bear in mind that the cover provided by such a policy may overlap with that provided by the DCU Plan, i.e. it will be taken into account when calculating how much benefit should be paid under the Plan to ensure you receive 75% of pre-disability salary. You should therefore contact your local Cornmarket consultant for advice before joining the DCU Plan. Will I receive money back if I never claim under the Plan? No. As with health or car insurance, your contributions go to meet the cost of cover for you and your colleagues. This keeps the cost of membership to a minimum and means that there is no cash value paid out to those who never make a claim under the Plan. (f) 9 any annualised amount awarded by an arbitration tribunal or court of law or agreed settlement sum or ex-gratia payment attributable to loss of earnings arising out of any action relating to your disablement. or The maximum income continuance benefit currently 0,000 per annum. What benefits does the Plan provide for Job Sharers and work sharers/reduced hours? The benefits and contribution rate for job sharing and work sharing members are based on job sharing/work sharing salaries. In order to recognise that job sharers/work sharers may have worked many years in full time employment before they took up job sharing/work sharing. Friends First are prepared to recognise this by reducing the ERP in the calculation of benefit. The benefit payable under the Plan is the amount needed to top up any ill health Early Retirement Pension and any Social Welfare Disability Benefit to 75% of pre-disability pensionable salary. In effect this means that whether you are a D or an A PRSI contributor, taking both the ill health Early Retirement Pension and the Social Welfare Disability Benefit into account, the combined amount you receive in the event of disability is the same. 4 5 Does my cover increase in line with my rising salary? One of the great advantages of the Plan is that it allows for your cover to be increased in line with salary rises, promotions etc. This means that the cover you enjoy under the Plan remains realistic over the years ahead. As members contribute by deduction at source (through salary) cover increases automatically every time your salary increases. This is because Friends First automatically increases your cover in line with salary rises without any need on the part of the member to complete new application forms or go for medicals. If I am claiming from the Plan, does the amount I receive increase each year? Yes. The benefit paid to you by the Plan increases by 5% each year or the rate of increase in the Consumer Price Index if lower. This helps ensure the benefit you receive remains realistic despite the effect of inflation. You should bear in mind that any Early Retirement Pension you receive will generally increase each year in line with salary rises awarded to working members. Does my Pensionable Service with my employer continue to accrue while claiming from the Plan? No. While you are claiming benefit from the Group Income Continuance Plan your Pensionable Service no longer accrues as this period is not deemed to be Pensionable Service. 8 (a) (b) (c) (d) (e) What are the maximum benefits paid under the Plan? 75% of your salary as paid by your employer less: any amount of salary, earning, profit, reward or remuneration which you are in receipt of from your normal occupation or any other occupation or business and the Ill-Health Retirement Pension entitlement calculated on the normal basis as set down by your employer, irrespective of whether you are receiving this amount or not and an amount equal to the state Illness Benefit payable to a single person, if entitled and any benefit you are receiving under the Social Welfare Act other than sickness, disability or treatment benefits payable to you under the Social Welfare Acts and any benefit you are entitled to under any other insurance against accident or sickness or other similar arrangement (where appropriate such an amount will be annualised) and Tax Relief Do I have to pay tax on benefits from the Plan? Benefit paid by the Plan will be treated as normal income and as such is liable to income tax, PRSI and the health levy. Friends First will deduct any tax due from the payment made to the member in the same way as an employer deducts PAYE and PRSI from an employee. How do I claim my tax relief on contributions? As you are making your contributions through salary tax relief is provided automatically (i.e. there is no requirement to submit details to your Inspector of Taxes). Tax relief 5

10 6 How do I claim from the Plan? Cornmarket s role is to help guide members through the claims procedures and ensure that all legitimate claims are paid promptly by Friends First, the insurers of the Plan. Cornmarket has considerable experience in this area and on behalf of claimants works closely with Friends First to ensure that all legitimate claims are paid. Cornmarket is not automatically notified of your absence from work through illness. This means that if you intend to make a claim under the Plan you must notify Cornmarket of this fact. You must contact Cornmarket (tel: ) for a claim form approximately 0 weeks in advance of the date your salary is due to be reduced to half pay or stopped altogether (see page 5: How the Plan works for details). Cornmarket will explain the additional documentation you will need to submit. Prior to completing your claim form please consult with Cornmarket. Upon receipt of your claim form, Cornmarket will process your claim with Friends First. You should note the following: All evidence reasonably required by Friends First must be provided by the member The member may be required to undergo medical examinations (at Friends First s expense) or an assessment by an occupational therapist Admittance of a claim is subject to Friends First being satisfied based on medical evidence received, that you are totally disabled from following your normal occupation and you are not involved in another remunerative occupation You may also be asked to undergo medical rehabilitation with a view to being rehabilitated back to your normal occupation. Friends First may also arrange for one of its Health Claims Advisors to call to you at your home address, either before any decision is made to admit the claim, or while the claim is in payment. The purpose of the home visit service is to explain the claims process, offer advice on social welfare and re-training if applicable, as well as outlining the various rehabilitation clauses contained in the policy. It must be emphasised that information required (including your claim form) by Friends First as outlined above must be dealt with fully and promptly. Undue delay, or failure to produce such information, may invalidate your claim. In the event of you failing to follow the advice of your own or any qualified medical practitioner all benefits payable or being paid under the policy may cease. STEP Contact Cornmarket Cornmarket is not notified automatically by your employer of your absence from work through illness. It can take a number of weeks to process your claim as various pieces of information must be gathered together for Friends First about your health, salary, etc. This means it is essential that you contact us at least 0 weeks in advance of the date your salary is due to reduce to half pay or is stopped altogether (see page 4: What happens when your sick pay runs out? for details). a step-by-step guide STEP 4 Your Claim Pack Once you contact us we will send you a claim pack containing 4 forms: Disability Claim Form This is the first piece of documentation you ll need to return to us. You should return this to us even before you have gathered together the other documentation. If you need any help in completing this form, simply contact our experienced staff on / In some cases Friends First may arrange for a Health Claims Advisor to visit you to assist you in the completion of the Disability Claim Form. Medical Certificate This is the second piece of documentation required and should be filled in by the doctor or specialist treating you. As much information as possible should be disclosed on this certificate to help avoid the need for further enquiry. Checklist Letter A letter containing a list of the documents (listed below) you will need to provide in order for your claim to be processed. Documents you will need to provide: Your original or certified copy birth certificate If you are female and married, your original or certified copy marriage certificate (this confirms the link between your present surname and that on your birth certificate) Copy of payslip. Authorisation Form This authorises us to contact your employer to request the documentation listed below. Documents we will get from your employer on your behalf: Confirmation of your salary details at the date of disability Confirmation of the date your salary ceased or confirmation of date half pay commenced Breakdown of your sick leave dates over last 6 consecutive weeks Confirmation of your Social Welfare Disability Benefit / Pension Rate of Pay or Early Retirement Pension Detailed description of your job Your PPS Number. STEP Processing your claim Once we receive your completed Claim Form and Medical Cert., we will send them to Friends First so that an assessment of your claim may begin immediately. Thereafter we will send on any documentation as we receive it and we will liaise between you and Friends First throughout the claim process. 7

11 8 STEP 4 STEP 6 Medical Examination Medical evidence will be assessed by Friends First s Chief Medical Officer. In most cases Friends First will request that you attend an independent medical examination (at its expense) to confirm you are indeed disabled from carrying out your normal job because of your disability. Your medical examination may be arranged with a doctor locally, however in some cases you may need to travel to attend for your medical examination (at Friends First s expense). Decision on your claim Additional Medical Evidence In some cases Friends First s Chief Medical Officer may require additional medical evidence from doctors and/or specialists who have attended to you. You may possibly be requested to attend a further medical examination (again at Friends First s expense). Note: During the assessment of your claim we will keep you up-to-date on medical reports and documentation received. Once all the medical evidence and documentation has been received, Friends First s Chief Medical Officer will make a decision on your claim. Should your claim be successful we will write to you confirming the amount of benefit payable. Friends First will then arrange to pay your benefit directly to your bank account. If you do not have a bank account your benefit will be paid by cheque. Please note: If your claim is unsuccessful and you are unhappy with the outcome, a series of appeals procedures are available: Direct Appeal Appeal to the Financial Services Ombudsman Arbitration You will find details of these in this explanatory booklet on page Q8: What happens if my claim is rejected?. We will of course be happy to help you with any appeal you wish to make. STEP 5 a step-by-step guide continued Once a claim is being paid, payment of the benefit is made by Friends First monthly in arrears at the end of each calendar month. Benefit payments are subject to income tax. Friends First will request the Revenue Commissioners to issue a certificate of Tax Free Credits to Friends First (as the employer) in relation to your claim payment. This will enable Friends First to apply the correct tax rate for future payments. However the first payment may have emergency tax rates applied (any overpayment of tax will be subsequently paid back). Your benefit Your benefit will continue to be paid for as long as you remain unfit to carry out your normal job because of illness or injury. Benefit payments will stop when: You recover i.e. when Friends First decides, based on the medical evidence that you are no longer prevented from doing your normal job because of illness or injury or You return to work or You die or Your 65th birthday whichever is earliest. In certain cases, benefit may be paid where you return to work at a reduced level of earnings due to partial disability. From time to time Friends First may require medical evidence confirming that you remain unfit to work. These steps are designed to help you through the claims process and ensure any benefit you are entitled to is paid out in time. If you have any questions please do not hesitate to contact us on (0) or (0) STEP 7 9

12 0 How disabled do I have to be to qualify for benefit under the Plan? To qualify for benefit under the Plan, Friends First must be satisfied that you are totally unable to carry out your duties under your normal occupation because of illness or injury and that you are not following any other occupation. Who decides whether or not I m fit to work? Friends First, advised by its Chief Medical Officer (CMO), will decide whether you are fit to work based on an assessment of all medical information. To qualify for benefit under the Plan, Friends First must be satisfied that you are totally unable to carry out the duties pertaining to your normal occupation because of illness or injury and that you are not following any other occupation. In certain cases benefit may be paid where the member returns to work to take up another occupation, but at a reduced level of earnings due to partial disability (see page : What happens if I return to work but at a reduced salary or take up a different, less well paid job? for details). While you are being paid benefit under the Plan, Friends First will seek regular medical certificates from your doctor. This is because you must continue to be disabled and unable to work in order to be entitled to continue to claim under the Plan. Friends First may also require an independent medical examination or specific information from your doctors. These medical examinations will be at Friends First s expense. You may also be visited by a Friends First Health Claims Advisor from time to time. In the event of you failing to follow medical advice during the course of benefit payments Friends First reserve the right to cease paying benefits. Please note that the fact you have been granted early retirement on the grounds of ill health under the rules of the Superannuation Scheme does not mean that you will automatically be entitled to a benefit under the DCU Plan. This is because Friends First reserve the right to undertake its own medical examinations and its own determination as to whether you are disabled under the terms of the DCU Plan. 4 Are there any exclusions under the DCU Plan? The Plan does not insure against disability arising from: Any kind of war whether declared or not Participation in a riot, insurrection or civil commotion A willfully self-inflicted injury or the deliberate neglect of health by failure to seek or follow medical advice. Benefit for a claim arising from the taking of alcohol or drugs (other than under the direction of a Registered Medical Practitioner) will be paid for a maximum period of 4 months and only if the member enters and remains active in a program of treatment. Please bear in mind that in some cases individual members may be accepted into the Plan subject to exclusions in respect of specific illnesses (see page : What does it mean if my application is subject to exclusions, extra premium, or even refused? for details). Are claims ever turned down by the Insurer? The great majority of claims, typically over 90%, are paid. However, experience has shown that when difficulties do arise, they usually arise because: When joining, the member did not disclose his or her full medical history In such cases Friends First reserves the right not to pay a claim. It is very important that when applying to join the Plan you ensure that you make a full disclosure in relation to any questions asked on the application form and during any medical examination you may undergo. If you don t, any claims you make may be turned down and cover under the Plan may be cancelled. Medical opinion is that the member is not disabled from carrying out his or her normal occupation Dependent upon the medical condition at issue, specialist opinion may be required. If ultimately in Friends First s view, the medical opinion is that you are not disabled as defined under the Plan, benefit will not be paid regardless of whether you have been retired on grounds of ill health by your employer. In the event of a dispute you may appeal to the insurer by providing additional specialist evidence. Should your appeal be unsuccessful you have the right to seek the assistance of the Financial Services Ombudsman who may take up your case without cost to you. Finally, if all other avenues fail, you can take your case to the courts, using the arbitration procedures provided for under the Plan. Throughout the appeal procedures, Cornmarket staff will assist you. 5 When does benefit payment under the Plan begin? The income payable under the Plan will be 5% of salary (after a deferred period of 6 weeks in any month period) increasing to 75% of salary when aggregated with any Early Retirement Pension Entitlement and Social Welfare Disability Benefit at a single persons rate, if applicable (after a deferred period of 5 weeks in any consecutive 4 year period while a member of the Plan). This deferral period applies to all staff irrespective of their sick pay entitlements. Please remember that it can take a number of weeks to process your claim as various pieces of information and medical evidence must be gathered. Friends First will arrange to pay your benefit directly to your bank account. If you do not have a bank account your benefit will be paid by cheque. 6 7 For how long will I be paid benefit under the Plan? The Plan will continue to pay benefit as long as your illness or injury prevents you from doing your normal job and you are not following any other occupation. Payments will stop when either: you recover; i.e. when it has been determined by Friends First, based on medical evidence, that you are no longer prevented from doing your normal job because of illness or injury or you return to work or you reach age 65 or death, whichever is earliest. In certain cases benefits may be paid where the member returns to work but at a reduced level of earnings due to partial disability (see page : What happens if I return to work but at a reduced salary or take up a different less well paid job? for details). Do I have to pay my contributions if I am claiming from the Plan? No. While you are claiming benefit from the Plan no contributions are deducted in respect of the DCU Group Income Continuance Plan.