State of California

  M E M O R A N D U M

  REFERENCE CODE:
  2002-079

  DATE:
  December 6, 2002

  TO:
  Personnel Officers
  Personnel Transactions Supervisors
  Benefits Officers

  FROM:
  Department of Personnel Administration
  Benefits Division

  SUBJECT:
  Annual Premium Review for Basic Group Term Life Insurance, 
  Supplemental Life Insurance, and Long-Term Disability 
  Program 

  CONTACT:
  Desi Rodrigues, Personnel Management Analyst II
  (916) 324-0533, CALNET 454-0533
  FAX: (916) 322-3769
  Email: DesiRodrigues@dpa.ca.gov


  Effective January 1, 2003, premium changes take effect for 
  certain employees enrolled in the Basic Group Term Life 
  Insurance, Supplemental Life Insurance, and Long-Term 
  Disability (LTD) Program for excluded employees.  These 
  changes are based on the employees' age, salary and/or 
  policy amount.
  
  Basic Group Term Life and Supplemental Life Insurance 
  
  The Basic Group Term Life Insurance policy for enrolled 
  excluded employees requires that once an active employee 
  reaches age 70, his/her employer-paid life insurance 
  premium and benefit will be reduced 50 percent on January 1 
  of the following year.  Therefore, effective January 1, 
  2003 (December 2002 pay period), the employer-paid premium 
  will be reduced 50 percent for employees who turned 70 
  during 2002.  For managerial employees, the benefit will be 
  reduced from $50,000 to $25,000.  For confidential and 
  supervisory employees, the benefit will be reduced from 
  $25,000 to $12,500.
  
   
  Premiums for employees enrolled in the Supplemental Life 
  Insurance plan are based on age and amount of insurance 
  purchased.  Metropolitan Life Insurance Company (MetLife) 
  conducts an annual audit to determine whether a premium 
  increase is necessary, based on an employee's age.  MetLife 
  will notify affected employees of any premium increases, 
  which the State Controller's Office will implement 
  effective January 1, 2003 (December 2002 pay period).  
  
  Employees who have questions regarding these increases 
  should call a MetLife representative at 1-800-252-8524.
  
  Long-Term Disability (LTD) Annual Age Review
  
  The formula for calculating premiums for employees enrolled 
  in the LTD program is based on several factors, including 
  the employee's base salary, age, and retirement category 
  (e.g., Miscellaneous or Safety).  On January 1, the annual 
  age/salary update is conducted for all employees enrolled 
  in the LTD program.  The State Controller's Office will 
  audit the payroll history files to identify employees who 
  experienced salary/age changes during the current year 
  (2002) that would affect their premiums.  Employees who 
  have moved to the next higher age factor (e.g., from age 39 
  to 40, 49 to 50, etc.) will have their premiums increased 
  effective January 1, 2003 (December 2002 pay period).
  
  If you have questions, please contact Desi Rodrigues at 
  (916) 324-0533 or Calnet 454-0533.
  
  
  
  Terri Westbrook, Chief
  Benefits Division