Term Life – Accidental Death – Dismemberment (AD – D) Insurance #farm #insurance

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Life Accidental Death Dismemberment Insurances

UNDERSTAND

The UW provides a basic employer-paid term life insurance and accidental death and dismemberment (AD D) benefit for PEBB insurance-eligible employees. Term insurance has a low group premium (unlike whole life insurance) and no cash value.

Life Insurance

Life insurance provides a lump sum of money to beneficiaries upon death of the insured. It is commonly used to replace the deceased’s loss of current and some future income, and may also be useful in estate planning. Beneficiaries will receive payments whether the insured dies of natural or accidental causes. The decision to purchase life insurance, and how much, is a personal choice based on what the person is trying to protect. Life insurance can help:

  • replace the loss of future income;
  • provide the ability for a spouse/partner to keep a home;
  • allow a surviving partner to raise and educate children;
  • provide income to an elder who relies on family for day-to-day support.

Accidental Death and Dismemberment (AD D) Insurance

AD D insurance provides a lump sum payment if death or dismemberment is the direct result of an accident. If the insured has both life and AD D insurance and dies as the result of an accident, both coverages are paid to designated beneficiaries. An employee enrolled in AD D insurance who becomes dismembered as a result of an accident will be paid according to the schedule of indemnities listed in the plan document. The employee is the beneficiary for any dependent claims. AD D coverage does not require proof of good health, and can be added or dropped at any time. AD D insurance has no cash value.

Coverage

Life insurance is available regardless of health issues, as long as the eligible employee applies for coverage during the first 60 days of initial insurance eligibility. For amounts above the guarantee issue limits, and for all life insurance requested after the initial 60-day window, eligible employees are required to provide evidence of insurability (EOI).

The program contains six parts. The first part is for Basic Life Insurance ($25,000) and Basic AD D Insurance ($5,000). The premiums for this part are paid by the University at no cost to you. The other coverage options allow you to design the rest of your own plan. See a Summary of Coverage and Premium Rates.

ACT

Determining Your Insurance Needs

The amount of insurance needed, if any, depends on individual circumstances. Life events, such as the birth of child, marriage, or death may impact your decision regarding the amount of life insurance you may want to elect. Many people find that as they get older they need less life insurance. If there are adequate retirement savings, the mortgage is paid, and children and elderly parents are financially independent, very little or no life insurance may be needed. However, life insurance may also play a role in estate planning, or in choosing retirement income options, depending on the health of the employee and/or dependents. Life insurance should be viewed in the context of the individual’s total financial plans.

Determining insurance needs requires evaluating current and future assets as well as expenses such as:

  • costs of staying in your home
  • child care costs
  • elder care costs
  • college expenses
  • education/training/re-training for a spouse or qualified domestic partner currently working at home
  • costs of assisting a disabled family member

Providing Evidence of Insurability (EOI)

If you are:

  • a newly-eligible employee who applies after the initial 60-day deadline for guarantee-issue coverage, OR
  • a PEBB insurance-eligible employee who applies for more insurance than is guarantee-issue, OR
  • a PEBB insurance-eligible employee who wants to increase coverage amounts at a later date.

Enrolling

  1. Review the Life Insurance Enrollment Plan Book including current premiums.
  2. Check out the PEBB/ReliaStar Life Insurance Calculator .
  3. Complete the Life and AD D Insurance Enrollment Form .
  4. Indicate the total desired amount of coverage you want for yourself and/or your dependents.
  5. Complete the Evidence of Insurability Form if required for you and/or your spouse or qualified domestic partner.
  6. Send the completed form(s) to the UW Benefits Office .

Coverage, which does not require review/approval by the insurance company, will be effective the first day of the month after the signature date on the enrollment form, provided that you apply within the first 60 days. If evidence of insurability is required, the Benefits Office will forward your form to the insurance company, which will contact you directly if any additional information is needed. When evidence of insurability is required, coverage is not effective until the first of the month following the approval date.

Paying Premiums

The University pays the eligible employee’s premiums for Basic Life Insurance and Basic AD D Insurance. You pay premiums on any additional insurance benefit you elect. Premiums for life insurance are taken on a post-tax basis.

Filing a Claim

The UW Benefits Office files claims on behalf of you or your beneficiary. A certified copy of the death certificate is required for the claim.

Insurance Continuation

Continuing Coverage During Leave or Layoff

If you are on leave or lay off status, you may self-pay your life insurance by paying the employee premium plus the UW’s contribution. If you do not do so, you may be required to re-apply with evidence of insurability.

Insurance Portability After Separation

As a separating employee, you have the option to continue group term life insurance (upon approval of the life insurance company) until age 70 provided that you apply within 31 days of the date you or your insured dependents’ coverage ends due to termination of employment. Rates for insurance portability are listed on the Life Insurance Portability Application. (Note that you cannot port the Accidental Death and Dismemberment benefit.) To apply for this benefit:

  • First, verify that you and your dependent(s) are eligible for portability of life insurance coverage. Refer to the three questions on the application form to help you determine whether you are eligible. If you are still unsure of your eligibility, call ReliaStar Customer Service at 1-866-689-6990.
  • Complete the Group Life Insurance Portability Application Form only if you are eligible.
  • Next, a benefits representative must sign the form after confirming your benefit coverage and eligibility date of coverage.
  • Once signed, you must mail the form to ReliaStar Life Insurance Company (address is listed on form).
  • If your application is approved for continuation of life insurance, you will be billed directly by the carrier.

Insurance Conversion After Separation

As a separating employee, you may convert your group term life insurance to individual permanent whole life coverage as long as you apply within 31 days of termination and provided that you were covered for at least five years. Retiring employees must apply within 60 days of separation. Evidence of insurability is not required. Accidental Death and Dismemberment coverage cannot be converted.

Note: individual life insurance rates are significantly higher than group term rates, and whole life insurance is generally more expensive than term life insurance. If you are a separating or retiring employee, contact the Benefits Office for more information about life insurance conversion.

Life and AD D Forms and Publications

Background

Effective January 1, 2012, the Public Employees Benefits Board (PEBB) merged the previous optional life insurance (Part C) and supplemental life insurance (Part D) into a single employee supplemental option.

Disclaimer: The information on this page does not substitute for official plan documents. If there is a conflict between the information on this site and an official plan document, the official plan document will govern. Plan availability and eligibility may change depending on your employment status and/or actions of the Washington State Health Care Authority.

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