NZDF Regular Force & Civilian MIBP

Transcription

1 NZDF Regular Force & Civilian MIBP MEMBER INSURANCE BENEFITS PROGRAMME Frequently Asked Questions (FAQ) 1 st October 2014 NZDF in conjunction with their Insurance Brokers Aon New Zealand have created the MIBP for Regular, Civilian & Reserve Force personnel and their spouses. The NZDF MIBP comes into force from 1 st October 2014 and this is the FAQ for the Regular Forces and Civilians. MIBP is made up of four key components:- Tier 1: BaseSecure Life, Terminal Illness, Physical Loss and Income Protection Insurance. The cost of this is fully funded through NZDF. Tier 2: ReinforcementSupport Voluntary top-up insurance benefits including Life, Terminal Illness, Physical Loss, Trauma and additional Income Protection. These are funded by you and your insurance is between you and the provider. Tier 3: LifePartner Voluntary benefits for your spouse/partner (does not apply if they are Members of NZDF) including Life, Terminal Illness & Trauma. These are funded by you and your insurance is between you and the provider. Tier 4: ExtraCare Over and above Tiers 1, 2 & 3, a range of insurance options, with personal advice from Aon, available to you and your spouse/partner at discounted rates. These are funded by you and your insurance is between you and the provider. MIBP Tiers 1, 2 & 3 benefit summary: Tier 1 Tier 2 Tier 3 Insurance Benefit BaseSecure ReinforcementSupport LifePartner Life & Terminal Illness Yes Yes Yes Physical loss Yes Yes No Income Protection Yes Yes No Trauma Insurance No Yes Yes MIBP Site Seminars, Gateway & Member Packs Seminars will be held on NZDF sites throughout September and October You are strongly encouraged to attend these Seminars and read the information in the Member Packs. Please complete your Registration Form so that your Tier 1 Certificate can be sent to you, along with information on Tiers 2 & 3. Copies of the Seminar presentation can be found on the DPE HR Toolkit and the MIBP Gateway Password MIBP. NZDF Contacts Contact either HRSC phone , or else your local HRA. Aon Contacts A free call number 0800 MIBP4U ( ) is available Monday to Friday to answer any queries you may have. Claims or questions should be directed initially to our Insurance Brokers Aon New Zealand (Aon) on this 0800 number or by to nz.nzdf.enquiries@aon.com. A Disclosure Statement is available free of charge from Aon. Please note:- This FAQ document is not a substitute for any Insurance Policy wordings or other specific product documentation. The Tier 1 Policy Documents are held by NZDF, and the Tier 2 & 3 Policy Documents are held by Perpetual Guardian as corporate trustee, copies are available on the DPE HR Toolkit and the MIBP Gateway Password MIBP. Page1

2 MIBP Tier 1 BaseSecure General Information As a member of MIBP you receive the following insurance benefits under Tier 1 BaseSecure; these are fully funded through NZDF: Life including Terminal Illness - $300,000 Q1 What Tier 1 benefits do I receive under MIBP? Physical Loss up to $50,000 see Schedule at back of this FAQ, the DPE HR Toolkit or on MIBP Gateway Income Protection: - 75% of your salary (up to a maximum salary of $160,000 per annum) (refer Q6 for definition of salary) - This is payable monthly in arrears after a stand down period of 90 days, and - Payable for a benefit period of up to 2 years, or age 70, or earlier recovery, whichever comes first These benefits are worldwide 24 hours a day, seven days a week. Q2 How do I get cover for these benefits? You are automatically covered for these benefits, subject to the eligibility criteria in the policy wordings, from 1 October 2014 or when you join NZDF if later. Q3 What is the eligibility criteria? Members of the Regular Force (full and part time) are all eligible Members of the Civilian staff (permanent or fixed term full and part time) are all eligible. Q4 How much does this cost me? The premiums for Tier 1, BaseSecure are fully funded through NZDF there is no cost to you. From 1 October 2014 all Regular Force members and all permanent fixed term Civilian employees are automatically enrolled by NZDF for membership in MIBP. Q5 Is there anything I am required to do; how do I join? Please complete your Registration Form to receive your Tier 1 Certificate of Insurance and additional information on Tiers 2 & 3 by 31 December 2014, or within 2 months if you join after that. If you miss these deadlines it may impact the joining concessions available to you under Tier 2 & 3. NB You are still covered under Tier 1 even if you don t request your Certificate of Insurance. Regular Force salary is your base salary plus your military factor. Q6 What do you mean by salary? Civilian salary is your base salary. The rest of your TR components are excluded from any MIBP benefit calculation. Page2

3 Q7 Are NZDF belligerent operations anywhere in the world covered by these insurance benefits? Yes they are for Tier 1, please see the Tier 2 section below for information on Tier 2 cover there. Cover is not available for this under Tiers 3 or 4. Q8 If I am a Civilian employee and sent overseas on NZDF business am I covered? Yes cover is worldwide 24/7. Q9 Q10 Are there any age limits? Can I assign my cover to another person? All Tier 1 commercial insurances cease when you turn age 70. NZDF self-insures for those permanent and fixed term members aged 70 and above. No, cover is through a group plan and cannot be assigned by individual members. However if you register with Aon you will receive a certificate confirming your cover and lending institutions may accept this as proof that you are insured for mortgage or loan purposes. Q11 As a member of the existing Death and Disablement Insurance (DDI) scheme how does this MIBP affect me? Currently you are insured for 3 x salary Life Terminal Illness and Total & Permanent Disablement. From 1 October 2014 you will move to the Tier 1 NZDF provided $300,000 Life and Terminal Illness benefit, including Physical Loss. You will lose the Total & Permanent Disablement benefit but gain the Income Protection and Physical Loss benefits. Q12 Why will I lose the total and permanent disablement cover? Very few claims are paid under a total and permanent disablement benefit as the qualification threshold for a claim is very high. Income protection is seen as a more relevant benefit with a higher likelihood of a benefit payment. NZDF s view is that income protection insurance is better aligned to serving the needs for both Regular Force and Civilian personnel. For most members a change to $300,000 is beneficial. It is considered more equitable in that it places the same value on each member s life. Analysis of 70 death payments made in recent years shows that all but two of the recipients would have received a greater payment had the Life and Terminal Illness cover been set at $300,000. Q13 The current DDI benefit is 3 x salary the new benefit of $300,000 is less than my 3 x salary, why? Overall this change benefits the greatest number of members. Some members will have reduced cover by the change from 3 x salary to $300,000. If this is your situation you will be able to automatically retain your higher level of cover, by moving this to Tier 2 however you will need to pay the cost of the premiums for the cover above $300,000. Please complete the Registration Form by 31 December 2014 and Aon will contact you with information on your options. From receiving this information you will have 60 days to take up this higher level of cover without providing any health evidence and fully protecting your preexisting conditions. Page3

4 Q14 Was any Comparison done with other countries for benefit levels? Yes, analysis was done of the UK, US, Australia and Canada armed forces, and NZ Police and NZ Fire Services Commission. The NZDF MIBP are comparative to other jurisdictions taking into account ACC cover available to NZDF personnel is not available to other armed forces. Q15 I am a Civilian employee and also a Reserve Force member do I receive both covers? No, you will only be entitled to the Civilian benefits Q16 What happens if I take parental leave or leave without pay? Tier 1 Cover is automatic for the first 365 days. Beyond day 365 cover can be extended for a further 365 days by individual arrangement, contact Aon to make these arrangements. Q17 Q18 If I leave NZDF can I continue some or all of my Tier 1 insurances at my own expense? Can I top-up this Tier 1 Cover or purchase additional cover? If you leave NZDF you have a Continuation Transfer Option to continue your Tier 1 insurance benefits & protect cover for any preexisting conditions. You have 60 days from leaving the NZDF to complete the Continuation Transfer Option taking all or some of your Tier 1 insurance to Tier 2 it s your choice. During the first 45 days from leaving NZDF your Tier 1 Life & Terminal Illness cover continues. You will need to pay for this by Monthly Direct Debit in addition to any other Tier 2 or Tier 3 options you already have. This means that your cover continues automatically when you exercise this Option as no evidence of health is required and you seamlessly maintain your benefits at the Tier 2 concessionary premiums. If this might apply to you please contact nz.nzdf.enquiries@aon.com or ring 0800 MIBP 4U. Yes, you can top-up your Tier 1, BaseSecure cover. Refer to Tier 2 ReinforcementSupport section in this FAQ, or the DPE HR Toolkit or the HRSC or your HR Advisor. Q19 Is any cover available for my spouse / partner? Tier 3 provides some insurance options for your spouse / partner. Refer this Section in this FAQ. Q20 Are any Death & Terminal Illness, Physical Loss or Income Protection payments subject to KiwiSaver or other superannuation contributions? No, benefits paid under Tiers 1, 2 & 3 are not liable for any contributions to KiwiSaver or any other superannuation scheme. Page4

5 Q21 Would KiwiSaver, Veteran Pensions or any other superannuation Payment impact on any benefit payments received? For Life & Terminal Illness and Physical Loss there are no reductions if you are in receipt of KiwiSaver Veteran pensions or superannuation payments. Income Protection payments may be reduced if you receive a regular payment from the superannuation scheme in respect of the disability you are claiming under. You can however receive National Superannuation, a Veterans Pension, a GSF pension and your KiwiSaver funds without any offset. Refer to the Income Protection section in Tier 1 of this FAQ for more detail. Q22 What other cover is available for me or my spouse / partner or children? Tier 4, provides a range of insurance options not covered in Tiers 1, 2 & 3. If this is of interest to you please nz.nzdf.enquiries@aon.com or ring 0800 MIBP 4U. Q23 I am unable to attend any MIBP Seminars, how can I sight the presentation? Please go to the DPE HR Toolkit or the MIBP Gateway where you will find a tab with the Seminar Presentation. FAQs for DFSS Members Q1 How does MIBP impact on DFSS members? DFSS members continue to have access to the insurance available through membership of the DFSS. However, for the transition period 1 October 2014 to 30 June 16 they will also be provided with Tier 1 of the MIBP. DFSS members are able to access the MIBP Tier 2, 3 or 4 options at any time. Q2 How will the overlay of MIBP and the DFSS Insurance benefits work? For the transition period 1 October 2014 to 30 June 2016 DFSS members (or their estates) will be able to access: Two potential Life insurance payments, to a maximum of $800,000. If your insured Life & Terminal Illness benefit through the DFSS is over $500,000 your MIBP Tier 1 benefit will be reduced to keep the total combined cover at $800,000 The DFSS Total Permanent Disability payments Physical Loss Insurance of up to $50,000 Income Protection Insurance, payable at a rate of 75% of salary payable for up to two years after the 90 day stand down period MIBP Tier 1 provides for Life cover of $300,000. DFSS Members should check their Superfacts site or phone the Mercer number to obtain details of the actual death or TPD payment available to them through membership of the DFSS. Page5

6 Q3 Why is the MIBP Tier 1 overlay for a temporary period only? DFSS and non DFSS insurance arrangements are inequitable. Additionally, there are problems with the current levels of DFSS insurances, with a number of members having little or no insurance cover. The Trustee and NZDF have commenced a review of the scheme s insurance arrangements, at the conclusion of which members will be presented with options. This exercise will take time to complete. To apply greater equity and ensure all members have access to insurance cover, DFSS members will temporarily have access to two sets of insurances. Q4 Why do DFSS members continue to pay for their insurance while NZDF pays for other personnel? NZDF under MIBP now provides insurance benefits under Tier 1 for all eligible Regular and Civilian personnel from the 1 October 2014, which removes these inequalities. DFSS continues their insurance payments as a part of their DFSS superannuation membership and those overall benefits. Q5 Concerning use of the Reserve Accounts being used to partially fund MIBP Tier 1 benefits for DFSS members? How was this approved? Is this permitted under the DFSS rules (Trust Deed)? The DFSS Trust Deed requires the Category A Reserve Account to be used for the benefit of Category A members and the Category C Reserve Account to be used for the benefit of the Category C members. Legal advice from the legal advisers to the DFSS, DLA Philips Fox, is that provision of MIBP Tier 1 insurance to members of the DFSS is a benefit and therefore that use of respective Reserve Account for this purpose is compliant with the Trust Deed. Reflecting this advice, CDF has approved use of the DFSS Category A Reserve Account to fund provision of MIBP Tier 1 to members of the DFSS Category A and the Trustee, after consultation with the Advisory Trustees, has approved use of the DFSS Category C Reserve Account to fund provision of MIBP Tier 1 to members of the DFSS Category C for the period 1 October 2014 to 30 June The Trust Deed does not permit the Reserve Accounts to be used for the benefit of DFSS Category B members. CDF will pay for provision of MIBP Tier 1 to members of Category B. Q6 As a DFSS member am I able to exercise the options available to NZDF personnel through Tiers 2, 3 or 4? Yes, at any time DFSS members are able to access the Tiers 2, 3 or 4 options, subject to the standard rules governing each Tier. See the following sections on Tiers 2, 3 & 4. Page6

7 MIBP Tier 1 BaseSecure Life Insurance, Terminal Illness & Physical Loss Insurance Information Q1 How does this Life & Terminal Illness insurance work? Life Insurance provides an automatic lump sum payment of $300,000 if you die, from any cause. If you are diagnosed as terminally ill, a lump sum of $300,000 may be paid in advance of death. Q2 How do I qualify for a Terminal Illness benefit and how is this benefit paid? If your specialist diagnoses you as being terminally ill and likely to die within 12 months, the Insurer has an option to pay the death benefit early, i.e. payment in advance of death. The payment is made currently as a tax free lump sum. Q3 What if I don t die from the terminal illness within 12 months? You are not required to pay the money back. However the terminal illness payment is an early payment of the death benefit so when you do eventually die no further funds will be paid. Q4 Q5 As the payment of a death claim can sometimes be delayed with estate issues, can an advance Funeral Benefit be paid? How long am I covered for under this Plan? Yes it can. Subject to NZDF approval, a Bereavement Support Benefit of up to $15,000 can be advanced from the $300,000 Life Benefit to cover approved funeral expenses. Enquiries about a Claim for a Bereavement Support Benefit should be directed to an HRA or Aon, 0800 MIBP 4U ( ). The estate should check for any other entitlement with NZDF and or Veterans Affairs New Zealand. The Life Insurance benefits cover you until you either leave NZDF, attain the age of 70 or if a death or terminal illness claim is made under this policy. Income protection payments are separate to any life insurance benefit. NZDF self-insures Tier 1 cover for those members aged 70 and over. Q6 Q7 How does the Physical Loss Benefit work? Are Physical Loss payments in addition to ACC (AEP)? The physical loss accident benefit is based on a specified list of events and a payment associated with each event. The maximum amount under Tier 1 is $50,000. Refer to the Physical Loss Schedule attached to this FAQ to see the scale of payments. Yes, all Physical Loss payments are additional to any ACC payments. Page7

8 MIBP Tier 1 BaseSecure Income Protection Insurance Information Income Protection Insurance provides for continued payment of a percentage of your salary if you become Disabled and unable to follow your usual occupation or trade whilst you are a member or employed by NZDF. Q1 How does this Income Protection insurance work? If your salary is less than $160,000 per annum, if eligible, you will be automatically covered up to 75% of your salary from 1 st October 2014 or after that if you join NZDF at a later date. If your salary is above $160,000 please complete your Registration Form in your Member Pack or on line via the MIBP Gateway, and Aon will contact you with information on your options to increase your cover to your full entitlement (75% of actual salary up to the insurers maximum benefit), at your own cost under Tier 2. Q2 Q3 What does Disablement mean? How much is my benefit and how long is the Tier 1 benefit period? As a summary statement, disablement means you are totally and continuously unable to earn remuneration from your own occupation or trade and; You are not earning remuneration from any other occupation including NZDF, and You are under the regular care and attendance of a Medical Practitioner. Disablement is from accident or sickness and can include sickness of a mental health nature. Your benefit is calculated as 75% of your annual salary paid by NZDF before the deduction of income tax. The Tier 1 benefit period is 2 years or age 70 whichever occurs first. If you are normally working less than full time you are still covered and your benefit will be based on your actual earnings. Q4 I already have a personal income protection policy how will this work? If this applies to you please contact Aon by nz.nzdf.enquiries@aon.com or phone 0800 MIBP 4U. Page8

9 Q5 How long am I covered for under this Plan? As a summary statement, the Income Protection benefit payments under Tier 1 will cease: Once you stop being disabled If you pass away When you reach age 70 or at the end of the 2 year benefit period, whichever is the sooner. (Tier 2 benefits, if you have selected & paid for these, may continue beyond the 2 years Tier 1 benefit). If you are in jail or otherwise detained as a result of a criminal act You make a false, dishonest or fraudulent claim or support any claim with false evidence You do not undertake medical treatment and/or rehabilitation which would assist you to return to work Q6 Q7 What sort of disabilities or events that might prevent me from working are not covered? Where does ACC (NZDF AEP) fit? Do I get both? Some disabilities or events that can prevent you from working are not covered: Intentional self- inflicted bodily injury or illness The taking of non- prescription drugs other than for therapeutic reasons The deliberate misuse of prescribed drugs Participation in a criminal act No - you don t get both unless your MIBP benefit exceeds your ACC payments. ACC covers accidents and this policy would respond for sickness and accidents not covered by ACC. If the ACC benefit is less than the sum assured under this policy (and you meet the definitions), this policy will pay the additional amount above the ACC payment. Q8 If my salary is above the ACC maximum benefit level can I claim both? Yes, The ACC maximum salary for benefits is currently $118,191. If your salary is above this amount you may also be able to claim under the income protection policy as it has a difference in limits feature. Q9 Is there a stand down period before a claim can be made? Yes - there is a stand down or waiting period, this is 90 days (including sick leave) from the date of your disablement. The claim payment is then made one month following completion of the 90 days and monthly thereafter ie benefits are paid monthly in arrears. Q10 What will I be paid in the 90 Day stand down? Each person s situation will be different. Please discuss your situation with your Commander / Manager as is appropriate. Q11 If I am only partially disabled can I claim? As a summary statement a partial disablement benefit is payable one month after the 90 day stand down where you are earning less income as a result of the disablement. You must have been unable to work for a minimum of 30 consecutive days. You will be able to claim a benefit after the 90 day stand down period has expired. The benefit amount will be adjusted to reflect your new earnings. Page9

10 Q12 What happens if I have a reoccurrence of a condition previously claimed for? Many people on Income Protection claim recover & return to work full time before the end of the benefit period, e.g. under Tier 1 this is 2 years. A few people on returning to work then have a relapse and if this occurs within 6 months from the same or related causes, the 90 day stand down period will not be applied. The claim may be treated as an extension of the earlier claim in which case the benefit period will apply to both the earlier claim and the period following relapse. Q13 If I am disabled and receiving an Income Protection claim benefit am I able to receive any rehabilitation assistance? Yes - this is at the Insurer s discretion to help cover the costs of specialised equipment or home alterations that have become necessary because of your disability. A lump sum of up to 6 times your monthly Income Protection benefit may be payable at the Insurers discretion to help cover these costs. This is in addition to your monthly Income Benefit. Q14 Is the Income Protection benefit taxable? Yes - your Income Protection benefit is income and therefore taxable just like your salary. Q15 How often are claim payments made? Claim payments are made monthly in arrears. The first payment will be made one month following the end of the 90 day stand down. This means it may be 4 months before you receive your first payment. Q16 Q17 Can my Income Protection claim benefit be reduced by other income I receive? Once I am on Income Protection claim what happens next? Potentially yes, your Income Protection Claim benefit may be reduced by income paid by reason of: Any injury and/or illness disability income benefits paid under any superannuation scheme or any other insurance policy or scheme ACC, weekly compensation, accident insurance, social security payment or any other state provided benefit Salary, wages or other remuneration If this does potentially apply to you the Insurer and Aon will make this clear to you and answer any questions you may have. Every month you will be sent a form to complete & return that gives the Insurer an update of your disablement condition to ensure you are still entitled to payments. Q18 Once on an income protection claim is my benefit ever increased? Yes, once you are on an income protection claim the amount of benefit is reviewed at each annual claim anniversary and increased by the lesser of the percentage increase in the CPI index over the corresponding period or 5% Page10

11 Q19 If I have an Income Protection claim e.g. for a heart attack, recover and say a couple of years later I have another heart attack or even a cancer disability, can I make a fresh claim? Yes. Each disablement is treated separately and on its own merits. A new benefit period of up to 2 years will apply to each new claim. Talk to Aon for more guidance. Q20 Who makes the medical assessment if I claim and what happens if I have claims issues or my claim is declined? The insurer makes the final medical assessment. If there are any issues you should contact your local HRA or Aon. Q21 Is NZDF obliged to keep my employment open for me for the duration of an income protection claim? No, however each situation is treated on a case by case basis and your commander/ manager is to seek advice from the local HRA before taking any action in this respect. Page11

12 MIBP Tier 2 ReinforcementSupport General Information Under the NZDF MIBP, Tier 2 offers insurance benefits you may not be able to obtain in a retail policy. Premiums may usually be lower and up to certain limits within an initial 60 day Special Offer Period, preexisting conditions are fully protected without any health assessment. Here are the details:- All full time and part time members of the Regular Force, and all permanent or fixed term Civilian employees are eligible for: Q1 What extra insurance benefits are available to me under Tier 2? Life, Terminal Illness & Physical Loss Insurance available in units of $50,000 extending Tier 1 benefits up to an maximum amount of $500,000 (and Physical Loss by an additional $50,000) Income Protection Insurance extending Tier 1 benefits from the 2 year benefit period, up to 5 years or even to age 70 Trauma Insurance- providing an additional cash injection benefit available in units of $5,000 up to a maximum amount of $150,000 These would be in addition to any other insurance policies you may hold. If you have another income protection policy please contact Aon as the policies are unlikely to pay duplicate benefits in respect of the same disablement. Page12

13 Concessionary Cover & Full Pre-existing Conditions Protection Concessionary cover up to the limits detailed below is available if you apply for Tier 2 options within 60 days of you being offered them. This means no health questions and cover for pre-existing conditions applies, subject to you being able to sign the declaration on the Tier 2 Quote Acceptance Form: 1) Life, & Terminal Illness insurance a) You can buy up to 3 x units of $50,000 i.e. total of $150,000. Additional units may be purchased with completion of health questions. b) Physical Loss is automatically included in the 1 st $50,000 unit, it is not available separately. 2) Income Protection insurance a) Extend the 2 year benefit period under Tier 1 up to 5 years i) Automatically available for salary levels up to $100,000, Q2 I understand that there are some important joining concessions for me under Tier 2, what are they? ii) If your salary is above $100,000, you can have cover above this joining concession, but subject to health assessment for the amount above $100,000. Aon will advise you on this. 3) Trauma insurance a) You can buy units in multiples of $5,000 up to a total of $60,000 i) Refer below to Trauma for explanation as there are some conditions around pre-existing conditions during your first 3 months of Trauma cover 4) NZDF belligerent operations are covered under Tier 2 providing you apply for Tier 2 benefits within the Special Offer 60 day period. Cover is also available outside this period, please contact Aon for information. How to apply for top up cover within the joining concession limits When you receive your Tier 2 Quotations from Aon, see Q2 above, you have a Special Offer 60 days to sign and return the Quote Acceptance and Direct Debit Forms to Aon to gain acceptance without any health assessment and this includes full pre-existing conditions protection to the limits detailed under each policy. NB If you apply for Tier 2 options outside the Special Offer 60 days then NZDF belligerent operations cover will not apply, a full health assessment may be required and pre-existing conditions may not be covered or terms or exclusions could apply. Q3 How do I find out about how much these Tier 2 insurance benefits will cost me? Refer to information on the DPE HR Toolkit or the MIBP Gateway. With the launch of the NZDF MIBP on 1 st October 2014, you have until 31 st December 2014 to submit your completed Registration Form. Aon, on receipt of this Form will send you your Tier 1 Certificate of Insurance and your Tier 2 insurance benefit quotations including a Quote Acceptance Form. These will set out the monthly cost to you of the various options and you can make your decision from there. Page13

14 Q4 How do I take out the Tier 2 cover? Complete and sign the Tier 2 Quote Acceptance Form and the declaration shown on that Form and return this with the signed Direct Debit Form to Aon. Q5 What if I am unable to sign the declaration? Contact Aon and they will provide assistance in this regard. Q6 Q7 How do I pay for these Tier 2 insurance benefits? Is suicide covered under my Tier 2 Life & Terminal Illness insurance? By direct debit from your bank account. With the Tier 2 Quotations, Aon will send you a Direct Debit Form to complete and to return to them with your Tier 2 Quote Acceptance Form. Tier 2 premiums will then be deducted from the Bank Account nominated by you on a monthly basis, until you advise to the contrary. Suicide is covered 13 months after you take this Tier 2 Life & Terminal Illness insurance out. If you are transferring Life & Terminal Illness cover above the Tier 1 $300,000 benefit that you previously had under the NZDF DDI Plan, suicide will be covered for that transfer cover, contact Aon for details. Page14

15 Tier 2 Income Protection There are a number of income protection options depending upon your requirements and your salary level you can: 1. Increase your Tier 1 benefit payment period from 2 years to 5 years. The benefit up to $100,000 salary is available automatically within the joining concession period Q1 What are the options available to me under income protection? 2. If your salary is above $100,000 you can increase your benefit to 75% of actual salary, subject to health assessment. Note; under Tier 1 75% of actual salary up to $160,000 is automatically covered for two years. 3. Increase the option above from 5 years to age 70, this is subject to health assessment 4. If your Tier 1 salary is above $160,000 you can apply to increase your benefit to 75% of your actual salary, for the Tier 1 benefit period of 2 years, as well as the options under 1 & 2 above (subject to the insurer s maximum benefit), subject to health assessment Q2 How does this work if my salary is above $100,000? If your salary is above $100,000 you automatically get the benefit equating to the $100,000. Any benefit calculated above this will be subject to health assessment by the insurer. An abbreviated questionnaire will be supplied upon request as the first step in this process. Tier 2 Trauma Insurance Q3 How does Trauma insurance work and if I purchase Trauma insurance can a claim under it impact on my Life or Income Protection insurance? If you are diagnosed with any of the Trauma conditions listed, meet the terms and conditions of the policy, and provided you survive for 14 days (not on life support), and your claim is accepted by the insurer, a lump sum will be paid to you. If your purchase Trauma Insurance and claim paid under it will have no impact on Life or Income Protection Insurance. There are over 30 conditions covered. Please refer to the schedule attached to this FAQ or to the policy on the DPE HR Toolkit or the MIBP Gateway. Q4 What are the Trauma conditions? NB Each Trauma critical condition is specifically defined in the policy document e.g. what actually is a heart attack? For example a very minor heart attack may not reach the policy definition of a heart attack. The same principle may apply to other Trauma critical conditions. If you have any questions or any doubt on the above contact Aon New Zealand. Q5 What are the options available to me under Trauma insurance Trauma insurance is available in units of $5.000, up to $60,000 without medical assessment. The maximum amount of Trauma you can buy is $150,000. Page15

16 Q6 How could I use a Trauma benefit? A trauma insurance payment may be used to cover additional expenses, or loss of income where a partner is required to give up work or go on reduced income to care for you. Q7 Q8 Q9 What are the limitations on the Trauma benefits? How do I find out about the costs of the Tier 2 benefits? How are the Tier 2 premiums paid? Only new events diagnosed after 1 October 2014 or after you join this policy if later are covered. The joining concession is still very important as there are many medical conditions that lead to an event that are still covered for example high blood pressure is often a precursor to heart or stroke conditions. There is a 90 day exclusion for certain events occurring in the first three months of your joining (refer to Schedule 2 of this FAQ). When a Trauma benefit has been paid all cover ceases. The exception is the angioplasty benefit which is 10% of the insured amount. Upon payment of an angioplasty benefit the remaining insured amount reduces to 90% of the original amount. If you request this you will be provided with a Registration Form to complete and return to Aon. Aon will send you your Tier 1 Certificate and special offer information on Tier 2 & 3 benefit options this will include details of the monthly costs. Costs are also shown on the DPE HR Toolkit and the MIBP Gateway. You pay your Tier 2 premiums by monthly Direct Debit from your bank account. Q10 Are the premiums I pay for Income Protection tax deductible As at 30 July 2014, they are tax deductible and Aon will give you an annual confirmation for submission to IRD provided you keep Aon notified of your current address. Q11 What happens if for some reason my direct debit doesn t pay? If for some reason you miss a direct debit payment a double payment will be requested next month. If you also miss payment the next month you will be requested to pay the missing amounts by cheque / or bank transfer. If you miss three months direct debit payments your covers will lapse. If you are still a member of NZDF you can reapply to join the MIBP, however you will need to complete a health assessment for all covers. If you are no longer a member of the NZDF you will be unable to re-join. If your premiums are in arrears no claims under Tiers 2 & 3 will be paid until premiums are up to date. Page16

17 Q12 How do I take out the extra benefits I want? When Aon sends you the 60 day Special Offer information, along with your Tier 1 Certificate of Insurance, this will include a quotation showing all options under the joining concessions (i.e. no requirement to complete health assessment). You indicate the options you require, sign the Quotation Acceptance Form along with the direct debit payment form and return these to Aon. Aon will also detail premiums for options above the joining concessions. If you want cover over the joining concessions, indicate the level you want and return the application to Aon and they will send you the heath assessment questionnaire. Aon/Sovereign will always protect your joining concession levels whilst we arrange any additional covers, it is very important that you respond to Aon within the Special Offer 60 day period to gain those covers available without health assessment. Health assessment is required where you want cover above the automatic concession for that benefit. Q13 What is health assessment? Initially the assessment is the completion of a health questionnaire. The insurer may also ask for a doctor s report or some tests, usually these tests will depend upon your age, the level of additional cover you want and your health history. When undertaking health assessment some people are accepted at standard conditions and premiums, however equally some applicants are charged an additional premium or a medical condition might be excluded for cover. Very rarely the additional cover might be declined. In those instances the automatic benefits are not affected. Q14 How long can I be covered for under Tier 2? You are covered up to age 70 for all benefits under Tier 2 unless you have been paid your full trauma benefit whereupon the trauma cover ceases. Your physical loss benefit will also cease where the full benefit has been paid, although your Life and Terminal Illness cover will continue. Q15 What happens to my Tier 2 benefits if I leave NZDF? As your premiums are paid by direct debit your cover will continue as long as the premiums are paid. You should contact Aon if you have any questions or want to change this cover. Q16 If I leave NZDF what happens to my Tier 1 covers? Tier 1 covers can be transferred to Tier 2 and the premiums are then paid by you by direct debit. You will still qualify for the concessionary premiums. You have 60 days from leaving NZDF to contact Aon to make this happen. This will fully protect your insurance cover and pre-existing conditions. If you already have Tier 2 benefits you can review the amount of combined Tier 1 and Tier 2 cover you need at that time. Aon will explain how. Q17 If I leave NZDF do I have to be a Tier 2 member to transfer my Tier 1 benefits to Tier 2? No, you can be set up as a new Tier 2 member; however you must do this within 60 days of leaving NZDF. Page17

18 Q18 Who do I contact about claims or for general information? If you wish to enquire about Claims for Life, Terminal Illness, Physical Loss, Trauma or Income Protection insurance, please contact Aon in the first instance, 0800 MIBP 4U. All other items please contact your HRA, HRSC or Aon on 0800 MIBP 4U or nz.nzdf.enquiries@aon.com Q19 Who is the Insurer? The NZDF MIBP Tiers 1, 2, 3 & 4 Insurances are insured by Sovereign. FAQs- GLIPs (Army and RNZAF Group Life Insurance Plans) Q1 What is the impact of these new arrangements on the current GLIPs? The current GLIPs will cease to accept new subscribers from 1st October Current GLIP subscribers as at 1 October 2014 are able to continue with their current arrangements, or alternatively, access the new Tiers 2, 3 or 4 arrangements where no health evidence is required and full pre-existing conditions are fully protected within the automatic cover concessions. As there are differences between the Tier 2 Trauma cover and GLIP, it is recommended that you contact Aon if you are considering a change. GLIP s provide Life, Terminal Illness and has Trauma insurance options but the acceptance by the Insurer was subject to full health assessment. Q2 What is the difference between Tiers 2 and 3 cover and the cover available under the GLIPs? What is the cost difference? Tiers 2 & 3 provide options for Life, Terminal Illness, Trauma and Income Protection insurance to supplement Tier 1 cover, but have certain automatic joining concessions that can provide cover up to generous limits without health assessment. The cover under the GLIPS cease at age 65 whereas cover under the MIBP cease at age 70. See the FAQ for more details and Aon will provide Tier 2 & 3 quotations so that cost comparisons can be made. Information is also available on the DPE HR Toolkit and the MIBP Gateway. Q3 How will a GLIP subscriber be able to compare the current and new arrangements? Your MIBP Member Pack contains information on the Tiers 2, 3 or 4 options and completion of the Registration Form will enable Aon to send you quotations. Compare the quotations with the prices for your current GLIP cover. A key difference between the two is that the GLIPs are a retail product and require completion of a medical questionnaire. Tiers 2, 3 or 4 are priced differently and no medical questionnaire is required up to the limits detailed in the information pack. Page18

19 Q4 Can I keep my GLIP covers and join Tier 2 as well? Yes you can keep your benefits under the GLIPS and choose any of the options under Tiers 2 & 3. Southern Cross - Medical Insurance Q1 What does the Southern Cross medical insurance package offer NZDF personnel? Refer to the Information Pack, there are attractive premium discounts available. Alternatively, information is also available on the DPE HR Toolkit or the MIBP Gateway. Q2 What benefits does the Southern Cross package offer NZDF members? A range of cover offered at rates below the retail rates applying to other members. Contact Southern Cross for all information. Q3 Are members able to sign up their family members? Yes. Refer to the information pack. Q4 Does the Southern Cross policy cover my medical costs if I am posted or deployed overseas? No, generally Southern Cross only covers medical expenses incurred in NZ, some policies may have an allowance for some overseas treatment not otherwise available in NZ. You should check with Southern Cross. Page19

20 Tier 3 LifePartner You can obtain benefits for your Spouse / Partner who is not a member of NZDF at your own cost Q1 Q2 Q3 Q4 Q5 What options are available to my partner/ spouse under Tier 3? What are Tier 3 joining concessions? How does my Partner/ Spouse take out the Tier 2 cover? What if my Partner/ Spouse is unable to sign the declaration? Are there any exclusions The Partner/ Spouse of all full time and part time members of the Regular Force, and all permanent or fixed term Civilian employees are eligible for: Life & Terminal Illness insurance in units of $50,000 to a maximum of $500,000. Trauma insurance is available with an initial unit of $20,000 and thereafter in units of $5,000 to a maximum value of $150,000. Note The Tier 3 Trauma cover is an accelerated benefit which means Trauma cover can only be taken with the Life & Terminal illness cover and the Tier 3 Life benefit will be reduced by the amount of any Trauma claim payment. Automatic cover up to the limits detailed below is available if your Partner/ Spouse applies for Tier 3 options within 60 days being offered them. This means no health assessment and cover for preexisting conditions applies, subject to your Partner/ Spouse being able to sign the declaration on the Tier 3 Quote Acceptance Form: 1. Life & Terminal Illness insurance has an automatic cover of $100,000 i.e. 2 x units of $50,000. You do not have to take 2 units the minimum amount is I unit 2. Trauma insurance The base unit of $20,000 is automatic and all additional units need health assessment These concessions are only available for 60 days from the date of offer. If you respond after the Special Offer 60 day period you will need to be health assessed and the joining concessions cannot apply. Your partner/ Spouse will need to sign the declaration on the Tier 3 Quotation Acceptance Form that will be sent to you after your send your Registration Form to Aon. Contact Aon and they will provide assistance in this regard. Yes, no benefit will be payable arising from suicide within the first 13 months, please also see the Trauma conditions Tier 2 Q 7. Page20

21 Q6 How are the Tier 3 premiums paid? You pay your Tier 3 premiums by monthly Direct Debit from your bank account or your Partner / Spouse may elect to pay the premiums from their bank account. If so a separate Direct Debit Form will be required. Q7 What happens if for some reason my direct debit doesn t pay? If for some reason you miss a direct debit payment a double payment will be requested next month. If you also miss payment the next month you will be requested to pay the missing amounts by cheque / or bank transfer. If you miss three months direct debit payments the covers will lapse. If you are still a member of NZDF your partner/ spouse can reapply to join the MIBP however they will need to complete a health assessment for all covers. If you are no longer a member of the NZDF your partner/spouse will be unable to re-join. If premiums are in arrears no claims under Tiers 3 will be paid until premiums are up to date. Q8 If I have a Trauma claim and then have a claim for a different event do I get another benefit? Q9 How long can my Spouse / Partner be covered for under Tier 3? Q10 If I leave NZDF can my Spouse Partner s Tier 3 benefits be retained to keep their insurance protection in place? Q11 If my Spouse / Partner should change, can my new Spouse/ Partner access Tier 3 Q12 If my new Partner/ Spouse joins Tier 3 can my previous Partner/ Spouse remain covered? No. Once you have had a trauma claim the insurer s obligation to you under this policy ends. The one exception to this is the Angioplasty benefit which is 10% of the sum insured, if this has been paid the sum insured for the remaining benefits reduce by 10%. You can continue to be covered up to age 70 at the discounted rate, thus just continue your monthly direct debit payments at the discounted rates. Yes they can. Just continue your monthly Direct Debit payments. Yes they can please contact Aon on 0800 MIBP 4U, and they will be able to help. Yes as long as premiums continue to be paid. Page21

22 Tier 4 ExtraCare You can obtain additional benefits, for yourself, your Spouse / Partner and your children at your own cost Q1 Q2 Q3 What cover is available under Tier 4? Are there any concessions? How do I get further information? Other options not available under Tiers 2 & 3, e.g. cover for adult children. Tier 4 is outside the spectrum of the group policies and is a retail option that is fully underwritten by Sovereign. However any cover taken out via Tier 4 may attract a premium discount. Attend a presentation or contact Aon nz.nzdf.enquiries@aon.com or phone 0800 MIBP 4U. About the Insurer All insurances available as part of the NZDF MIBP (Tier 1, 2, 3 and 4) are underwritten by Sovereign Insurance Company Limited (Sovereign). For full details of the products and benefits offered by Sovereign, please refer refer to the policy document(s) which are available from Aon or Sovereign. Sovereign, the policy insurer, is part of the Commonwealth Bank of Australia Group and is a related company of ASB Bank Limited and its subsidiaries ( the Banking Group ). None of the Banking Group, the Commonwealth Bank of Australia, any of their directors, or any other person, guarantees Sovereign or its subsidiaries, or any of the products issued by Sovereign or its subsidiaries. Copies of Sovereign s disclosure statements are available on request, free of charge. Sovereign has an A.M. Best financial strength rating of A+ (Superior), and paid out over $320 million in claims in the last financial year ending 30th June 2014, representing 94% of all claims made. Sovereign s rating is given by A.M. Best Inc., an approved insurance rating agency. A copy of the scale, of which this rating forms part, is available from Sovereign. Page22

23 Schedule 1 Physical Loss Schedule Events are only covered if they occur by Accident Causes Sum Insured Insured events Diplegia Total and permanent loss of function of both arms or both legs due to injury of the spinal cord Hemiplegia Total and permanent loss of function of one side of the body due to brain injury Paraplegia Total and permanent loss of function of both legs due to injury of the spinal cord Quadriplegia/Tetrapelgia Total and permanent loss of function of both upper and lower limbs due to injury of the spinal cord Permanent total loss of use of limbs (entire hand or entire foot) a) Two or more limbs b) One limb Permanent total loss of entire sight whether aided or unaided of a) Both eyes b) One eye Permanent total loss of entire sight of one eye (whether aided or unaided) and permanent total loss of use of one limb (entire hand or entire foot) Permanent loss of all hearing whether aided or unaided in a) Both ears b) One ear Permanent loss of use of 4 fingers and thumb of either hand (fingers 2 joints or more, thumb one joint or more) Permanent loss of use of 4 fingers of either hand 2 joints or more Permanent loss of use of thumb of either hand 1 joint or more Permanent loss of use of 1 finger of either hand 2 joints or more Permanent loss of use of toes of 1 foot all Permanent loss of use of toes of 1 foot great (big toe) both joints 3 rd degree burns (covering more than 40% of body) (Burns means damage caused by thermal, electrical or chemical agents resulting in tissue injury to a percentage of the body surface as measured by The Rule of Nines of the Lund and Browder Body Surface Chart) Fractured upper or lower leg or patella non- union (Fracture means the cracking or breaking of a bone as result of an accidental injury but specifically Excludes any fractures that result from excessive physical activity (e.g. stress fractures) or a Degenerative condition and not from any specific injury Shortening of leg by at least 5cm $50,000 % of sum insured payable 100% 100% 100% 100% 100% 50% 100% 50% 100% 100% 20% 40% 25% 25% 5% 15% 5% 50% 10% 7.5% Page23

24 Schedule 2 Trauma Schedule for MIBP Tiers 2 & 3 Alzheimer s disease and dementia Angioplasty ( 10% of sum insured) Aplastic anaemia Cancer Chronic liver failure Chronic lung disease Chronic renal failure Creutzfeldt-Jakob disease Heart Attack HIV (only for emergency services professionals) Major Burns Major transplant surgery Stroke Loss of functionality - Loss of independent existence - Permanent Blindness - Permanent Loss of Speech - Permanent Loss of Hearing - Permanent Loss of Two or more Limbs Major cardiovascular disease - Aortic Surgery - Cardiomyopathy - Coronary artery Bypass surgery - Heart Valve Surgery - Out of Hospital Cardiac Arrest - Pulmonary Hypertension Major neurological disease (other than stroke) - Benign Brain Tumour - Coma - Encephalitis - Idiopathic Parkinson s Disease - Major Head Trauma - Motor Neurone Disease - Multiple Sclerosis - Muscular Dystrophy - Peripheral Neuropathy Paralysis - Diplegia - Hemiplegia - Paraplegia - Quadriplegia NB Each Trauma critical condition is specifically defined in the policy document e.g. what actually is a heart attack? For example a very minor heart attack may not reach the policy definition of a heart attack. The same principle may apply to other Trauma critical conditions. If you have any questions or any doubt on the above contact Aon New Zealand. Page24