Lehigh will be changing Life Insurance and Long Term Disability carriers beginning with the new fiscal year on July 1.
This year, the LVAIC (Lehigh Valley Association of Independent Colleges) Human Resources group undertook a thorough proposal process aimed at controlling or reducing the cost of life and LTD coverages for area colleges and universities. At Lehigh, we selected The Lincoln Financial Group to replace The Hartford.
This change in carriers will mean only minor changes in how the life and LTD benefit programs operate—some of them enhancements to our current programs. Still, there are a few changes that tighten up the programs as well.
With regard to life insurance:
- For those employees who become permanently disabled, the provision which waives the cost of life insurance premiums will now continue through the end of their long term disability period. Previously, this waiver continued so long as the person was disabled, leading to a lifetime waiver—a benefit greater than that enjoyed by University retirees.
- Employees who purchase voluntary life insurance coverage through Lincoln Financial will have the opportunity to “port” (or continue to purchase as term life insurance) the entire amount of their voluntary life insurance when they leave the university. With Hartford, employees can only port up to $250,000 of coverage; anything in excess of that amount has to be converted to whole life insurance to be continued.
With regard to long term disability:
- The new carrier will implement an industry standard 3/12 pre-existing conditions clause for all new hires (staff who begin employment at the university and faculty who execute letters of appointment after June 30, 2012), which means the following:
Lincoln Financial will pay an additional LTD income benefit of 13% of income (up to a $5,000 monthly maximum) if the disabled employee loses two activities of daily living.
- If an employee becomes disabled during his or her first year of employment as the result of a medical condition for which treatment was recommended or received during the three months prior to employment at Lehigh, LTD coverage will not be available.
- Any disability that begins after the first of the month following the first day of work that is NOT the result of a pre-existing condition in the three months prior to employment at Lehigh is covered by the LTD program.
- Any disability that begins after the first anniversary (12 months) of employment is covered by the LTD program.
- If a non-covered disability begins during the first year of employment, the employee must return to work and complete a 12-month waiting period before LTD coverage for that condition is available to him or her.
The results of the carrier switch and policy revisions will be greater benefit equity for faculty and staff as well as cost savings for the university.
If you have any questions regarding these changes, please contact Tim Hinkle at extension 85167 or via email at email@example.com.