Optional Life Insurance and AD&D Plan Summary and Premiums

Coverage

Employees who are eligible for Basic Life Insurance may also purchase Optional Life Insurance coverage. Optional Life Insurance coverage can be one, two, three, four, five, six or seven times an employee's base salary up to $300,000. This amount is in addition to the Basic Life Insurance coverage amount of $50,000. A matching amount of accidental death coverage (AD&D) is automatically provided.

Biweekly Deductions

The premium for Optional Life Insurance coverage is based on a rate (determined by age) per $1,000 of coverage. The premium is paid through biweekly payroll deductions. The biweekly deduction amount is determined by multiplying the appropriate rate by the coverage amount. Two examples are provided at the end of this document.

Rates - Effective January 1, 2014

Biweekly deductions are calculated using the following rates (rates include coverage for an equal amount of AD&D coverage) and can also be found in the Life Insurance Enrollment Kit:

Employee Age

Cost Per Thousand Dollars of Coverage

less than 30

$0.024

30-34

$0.028

35-39

$0.036

40-44

$0.044

45-49

$0.064

50-54

$0.098

55-59

$0.151

60-64

$0.264

65 and over

$0.475

Enrollment Form

Please contact your operating location office responsible for benefits administration to complete an enrollment form indicating your Optional Life Insurance choice and beneficiary designations(s). Employees who have not applied within 60 days of eligibility will be required to provide medical evidence of good health.

Examples of Biweekly Calculations for the Optional Life Insurance Plan

Example One

Situation

Mr. Jones is 36 years old. His annual salary is $25,000. Mr. Jones has met the 6-month waiting period and is therefore automatically covered for $50,000 of Basic Life Insurance.

Mr. Jones has chosen 4 times his annual salary in Optional Life Insurance coverage.

Optional Life Coverage Amount

$25,000 x 4 = $100,000

Biweekly Deduction Calculation

$100,000 x .036 dollars per thousand = 100 x .036 = $3.60 biweekly deduction.

Therefore his total coverage amount is $150,000 ($50,000 of Basic and $100,000 of Optional)

Example Two

Situation

Ms. Doe is 49 years old. She has a projected annual salary of $50,000. Ms. Doe has met the 6-month waiting period and is therefore automatically covered for $50,000 of Basic Life insurance.

Ms. Doe has chosen 7 times her annual salary in Optional Life insurance coverage.

Optional Life Coverage Amount

$50,000 x 7 = $350,000

But the maximum optional benefit is $300,000, so we cap her insurance coverage at this level. She is also entitled to an additional $50,000 of the Basic coverage.

Biweekly Deduction Calculation

$300,000 x .064 dollars per thousand = 300 x .064 = $19.30 biweekly deduction.

Therefore her total coverage is $350,000 ($50,000 of Basic and $300,000 of optional)

Change History

 

 

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