State of California

  M E M O R A N D U M

  REFERENCE CODE:
  2003-049

  DATE:
  December 8, 2003

  TO:
  Personnel Officers
  Personnel Transactions Supervisors
  Benefit 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 
  Programs

  CONTACT:
  Susan Wong, Benefits Program Analyst
  (916) 324-0533, CALNET 454-0533
  FAX: (916) 322-3769
  Email: susanwong@dpa.ca.gov


  Effective January 1, 2004, premium changes take effect for 
  certain employees enrolled in the Basic Group Term Life 
  Insurance, Supplemental Life Insurance, and Long-Term 
  Disability (LTD) Programs for excluded employees.  These 
  changes are based on the employee's 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 by 50 percent on 
  January 1 of the following year.  Therefore, effective 
  January 1, 2004 (December 2003 pay period), the employer-
  paid premium will be reduced by 50 percent for employees 
  who turned age 70 during 2003.  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.
  
   
  Supplemental Life Insurance plan premiums are based on age 
  and the 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, and the State Controller's Office 
  will implement the increases effective January 1, 2004 
  (December 2003 pay period).  
  
  Employees who have questions regarding these increases 
  should call MetLife 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 
  (2003) that affect their premiums.  Premiums for employees 
  who have moved to the next higher premium age group (e.g., 
  from age 39 to 40, 49 to 50, etc.) will increase effective 
  January 1, 2004 (December 2003 pay period).
  
  If you have questions, please contact Susan Wong at 
  (916) 324-0533 or Calnet 454-0533.
  
  
  
  Debbie Endsley, Acting Chief
  Benefits Division
  
  Cc:  Metropolitan Life Insurance
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