Optional Group Term Life Insurance Program
For Employees of the State of Tennessee
Insuring your
future
What’s inside:
Why do I need life insurance?
How much is enough?
How do I enroll?
What do I need to know?
The State of Tennessee is proud to partner with Minnesota
Life Insurance Company to provide optional group term life
insurance benefits. This program offers you an affordable
way to provide protection for your family.
Before enrolling, there are two very important questions you
need to answer: Why do I need life insurance? and How much
do I need? This booklet provides information to help you answer
those questions and the instructions to enroll in coverage.
Who is eligible for coverage?
An employee is eligible for coverage if he or she is employed by
the State and scheduled to work no less than 30 hours a week.
In addition, seasonal or part-time employees with 24 months of
service, who are certified by an appointing authority to work at
least 1,450 hours per fiscal year are also eligible. Please see the
policy certificate on www.LifeBenefits.com/StateofTN for more
details on eligibility for employees and their dependents.
Enroll in four simple steps
Step 1 - Determine your needs
p. 5-6
Step 2 - Review your coverage options p. 7
Step 3 - Calculate your costs
p. 8–9
Step 4 - Enroll
p. 10
Questions?
Call Minnesota Life Customer Service
at 1-866-881-0631 from 7 a.m.–6 p.m. CT.
For assistance, go to www.LifeBenefits.com/StateofTN or call 1-866-881-0631.
3
What is Group Term Life insurance?
Group Term Life insurance provides a base level of protection that can be
enhanced by personal savings, individual life insurance and Social Security
benefits. It provides survivors with an “emergency fund,” allowing them to
use individual life insurance and other funds for longer-term needs.
• Basic Group Term Life – The State of Tennessee provides all full-time
employees under age 65 with at least $20,000 in basic group term life
insurance. For many people, this is enough coverage to provide for final
arrangements and their loved ones. However, the State recognizes that
the kind of life insurance you need can change over time. That’s why the
State offers additional Optional Group Term Life coverage for you to
purchase if you so desire.
•O
ptional Group Term Life – This is voluntary coverage paid for by the
employee, allowing the employee to choose the amount of insurance that
fits his or her personal and financial situation. As of January 1, 2013, the
State of Tennessee allows an eligible employee to choose Optional Group
Term Life insurance in $5,000 increments to a maximum of seven times
the employee’s annual base salary or $500,000, whichever is less.
How much life insurance do I need?
Everyone’s needs are unique and it helps to evaluate your family’s
financial situation before choosing the exact amount. Visit
LifeBenefits.com/insuranceneeds for an online calculator that can help you
estimate how much coverage you may need to meet your future goals.
Why do I need life insurance?
Think about it. If you died what would happen to the people who depend
on you for financial support? Studies* show that the premature death of
a household’s breadwinner can have a significant impact on a family’s
financial security. Even if the deceased has some life insurance, the amount
is often inadequate.
*LIMRA, 2011.
4
Underwritten by Minnesota Life
Step1
Determine your needs
To estimate the amount of life insurance you need, you’ll want to periodically
determine what you must protect in the event of your death. This worksheet
will help you determine your needs.
Assets and income
What would be available to your family now, if you weren’t here to provide
for them?
Spouse’s annual income
x number of years to age 65
$
Cash, savings bonds, stocks,
securities (current value)
$
Company savings plan (401(k), 403(b), other)
$
Cash value of life insurance
$
Other assets* or income (other than your own)
$
*Equity in your home, if you plan to sell or borrow against it for cash.
A=$
Basic necessities
What basic needs do you and your family have? (multiply the items
below by the number of years required, if applicable)
Home – remaining mortgage or rent
(120 months is a basic rule of thumb)
$
Annual household operating expenses
(utilities, food, clothing, insurance,
repairs, property taxes, etc.)
$
Childcare
$
Health – health insurance premiums
or medical/hospital expenses not
covered by insurance
$
Debt – balances on credit cards, car loans, etc
$
B=$
(Continued on next page)
For assistance, go to www.LifeBenefits.com/StateofTN or call 1-866-881-0631.
5
Comfort zone
What kind of special or one-time expenses may come along?
Tuition
$
Wedding
$
New residence
$
Elder care x number of years
$
Estate taxes, probate fees, attorney fees
$
Emergency fund
$
Funeral expenses (average is $5,000 - $10,000)
$
Golden years (money put aside
for survivor’s retirement)
$
C=$
Complete the equation
Complete the equation that most closely reflects your particular needs:
Basic necessities
B-A=$
(Compare to current Life Insurance amount)
Comfort zone
(B + C) - A = $
(Compare to current Life Insurance amount)
Remember, your calculation is based on today’s costs and doesn’t account
for inflation or changes in annual earnings. Review your needs periodically –
even annually – to ensure that your needs will be met now and in the future.
6
Underwritten by Minnesota Life
Step2
Coverage options at a glance
Below are the options available to you under the Optional
Group Term Life insurance plan available through the State
of Tennessee.
As a newly eligible employee of the State of Tennessee, you have the
opportunity to choose coverage for yourself and your children on a
guaranteed basis without providing proof of good health. You must enroll
in coverage within 30 days of your initial eligibility. You may apply for
spouse coverage; however health related questions(s) will be asked to
determine if coverage will be issued
Coverage type
Coverage options
Additional information
Optional Term
Life Insurance
$5,000 increments
• Maximum coverage is the lesser of 7x
annual base salary or $500,000
• Up to 5x annual base salary is guaranteed
if elected within 30 days of initial
eligibility; Elections above 5x annual base
salary will require proof of good health (Please see pg 14 for details)
Optional Spouse
Term Life
Insurance
• Spouse is not eligible if he or she is also
eligible for employee coverage
• A spouse may apply for coverage within
30 days after the marriage date
Spouse under
age 55
$5,000, $10,000,
$15,000, $20,000,
$25,000 or $30,000
• Maximum coverage is $30,000
Spouse age
55 or older
$5,000, $10,000 or
$15,000
• Maximum coverage is $15,000
Optional Child
Term Life Rider
$5,000 or $10,000
• Children are eligible from 24 hours to 26
years of age
• A child may also be added to the policy
within 30 days of the birth or adoption
date
• A child may only be covered by
one parent
• All child coverage is guaranteed
• Employee or Spouse must have Optional
Term Life coverage for the Optional Child
Term Life Rider to be elected
For assistance, go to www.LifeBenefits.com/StateofTN or call 1-866-881-0631.
7
Step3
Calculate your costs
Use these examples as your guide to calculating the life insurance costs for
you and your spouse.
Example:
Employee age 38, chooses $150,000 in coverage
$150,000 ÷
$1,000
=
150
Coverage
amount
x $.058
+ $0.30
Monthly rate
Administrative
cost
= $9.00
Monthly cost
Spouse age 34, chooses $20,000 in coverage
$20,000
÷
$1,000
=
20
Coverage
amount
x $.047
+ $0.30
Monthly rate
Administrative
cost
= $1.24
Monthly cost
Now just fill in the blanks!
$
Coverage
amount
8
÷ $1,000
=
x $
Monthly rate
+ $0.30
Administrative
cost
= $
Monthly cost
Underwritten by Minnesota Life
Optional Employee and Spouse Term Life insurance
monthly rates
Rates per $1,000 per month
Age
Rate
Under 25
$0.044
25 - 29
$0.044
30 – 34
$0.047
35 – 39
$0.058
40 – 44
$0.088
45 – 49
$0.150
50 – 54
$0.252
55 – 59
$0.393
60 – 64
$0.612
65 – 69
$1.016
70 – 74
$1.417
75 – 79
$2.177
80 and over
$3.934
Rates are subject to change and increase with age.
Optional Child Term Life rider rates
One monthly premium covers all eligible children.
$5,000 - $0.50 per month
$10,000 - $1.00 per month
For assistance, go to www.LifeBenefits.com/StateofTN or call 1-866-881-0631.
9
Step 4
Change your information
Enroll
You may only enroll during your initial eligibility period
as a newly hired employee or each year during your fall
annual enrollment period.
To begin:
• Review all the information in this booklet.
• Determine the level of coverage you want.
•G
ather the personal information you will need to enroll, such
as Social Security numbers and medical information if you
are choosing coverage that requires proof of good health.
Computer enrollment
It’s easy to enroll in coverage and designate your beneficiary online!
Log on
Log on to www.LifeBenefits.com/StateofTN with the ID and password
information provided below.
You will be prompted to change your password the first time you log on.
Your ID:
TN + your EdisonID number*
Your password:Your password is your eight-digit date of birth
(MMDDYYYY) followed by the last four digits of
your Social Security number
* Your EdisonID number can be obtained from your Human Resources Department.
If you do not have access to a computer or the Internet, forms have been
included with this booklet. Please complete the forms and return directly to
Minnesota Life at the address provided on the top of the form. If you would
like assistance with your enrollment, please contact Minnesota Life directly
at 1-866-881-0631 from 7 a.m. - 6 p.m. CT.
10
Underwritten by Minnesota Life
Enter your information
Follow the instructions on the site to enroll in insurance coverage for you
and your spouse and children if desired, and to designate your beneficiary.
After submitting your information, please print a copy of your application
for your records.
Clean up
Don’t forget to clear your personal information before leaving the computer.
When will my coverage be effective?
New hire coverage will be effective on the first day of the month following
three full months of employment. Coverage applied for that is subject to
proof of good health will be effective upon approval of the coverage. All
elections or increases are subject to the actively at work requirement of
the policy. Please see the policy certificate on www.LifeBenefits.com/
StateofTN for more details on coverage effective dates and exemptions.
For assistance, go to www.LifeBenefits.com/StateofTN or call 1-866-881-0631.
11
What features does my plan have?
Beyond paying a benefit in the event of your death, your Optional Group
Term Life insurance plan has other important features.
Portability – If you are no longer eligible for coverage as an active
employee, you may port (continue) your Optional Group Term Life
Insurance on a direct bill basis (portable coverage ends December 31 of
the year you turn age 70).
Conversion – If your coverage is terminated, you may convert your group
term life coverage to an individual life insurance policy. Premiums may be
higher than those paid by active employees.
Waiver of Premium – If you become totally disabled before age 60 and
remain disabled for nine (9) consecutive months, your life insurance
premiums may be waived.
Accelerated Death Benefit – If an insured person becomes terminally
ill with a life expectancy of 12 months or less, he/she may request early
payment of up to 100 percent of the life insurance amount.
Customized website – You can use www.LifeBenefits.com/StateofTN to
manage your Optional Group Term Life insurance coverage for you and
your family. For example, you can provide evidence of insurability
(if required), designate your beneficiary, calculate your premium
payment, and determine how much life insurance you need at this site.
12
Underwritten by Minnesota Life
What is a beneficiary?
Choosing a beneficiary
Naming a beneficiary is an important right of life insurance ownership. Your
beneficiary designation determines who will receive your life insurance
benefit. Under current tax law, life insurance benefits paid to a beneficiary
are generally not taxable income.
Some common beneficiary choices are:
• Primary beneficiary – The person or persons named will receive the benefit.
•C
ontingent beneficiary – If the primary beneficiary is no longer living,
the benefit is paid to this person.
•D
efault beneficiary – If you do not name a beneficiary, policy benefits
will be paid in the following order: to your spouse, if living; if not, to your
children in equal shares, if living; if not, to your parents in equal shares, if
living, if not; to your estate.
For Spouse Optional Term Life insurance, you may designate a
beneficiary. If no beneficiary is designated, the employee will be the
default beneficiary for this coverage. If the employee is no longer living,
the benefits will be paid to the estate of the Spouse.
For the Optional Child Term Life rider, the employee is automatically the
beneficiary. If the employee is no longer living, the benefits will be paid
to the estate of the Child.
Check your beneficiary(ies) regularly
Over time, events such as marriage, divorce, birth/adoption of children,
or the death of a loved one may dramatically change the intent of how
you want your life insurance benefit paid.
To designate or update your beneficiary, please log in to
www.LifeBenefits.com/StateofTN using your ID and password provided
on p. 10. You may also contact Minnesota Life directly at 1-866-881-0631
to obtain a paper form.
This information is a general discussion of the relevant federal tax laws. It is not intended
for, nor can it be used by any taxpayer for the purpose of avoiding federal tax penalties.
This information is provided to support the promotion or marketing of ideas that may
benefit a taxpayer. Taxpayers should seek the advice of their own tax and legal advisors
regarding any tax and legal issues applicable to their specific circumstances.
13
Underwritten by Minnesota Life
What is proof of good health?
What is proof of good health?
If an applicant chooses coverage that is not guaranteed, Minnesota
Life will request completion of an Evidence of Insurability (EOI) form
to determine if the applicant is insurable (a good risk). When providing
EOI, the applicant will answer a few simple health questions and provide
information on physical condition, height, weight, gender, and tobacco
status (if applicable). Once submitted, a medical underwriter reviews the
application to determine if the person meets our acceptance standards for
the insurance requested. Evidence of Insurability can be completed online
at www.LifeBenefits.com/StateofTN or via paper form. Paper forms are
also available online or by calling Minnesota Life at 1-866-881-0631.
Is additional medical information required?
Many applications can be processed using only the health information
provided on the EOI form. To complete the application process, a physical
exam may be required. Exams are free of charge and can be done at the
applicant’s home. The basic physical examination includes height, weight,
pulse, blood pressure and a medical history questionnaire. The examination
may include special testing such as a blood test, urinalysis and an EKG.
The medical records are kept confidential, and information from the exam
is not released to anyone else without the applicant’s consent. Once all
information is received, it is promptly reviewed and the applicant is notified
of the underwriting decision.
To apply for new coverage or increase your current coverage
when authorized, visit www.LifeBenefits.com/StateofTN.
You can find out in 60 seconds or less if you’re approved.
If you need an exam you can schedule it right on line!
14
Underwritten by Minnesota Life
About Minnesota Life
Minnesota Life is one of the
country’s largest group life insurers.*
We understand the important role
we play in the financial well-being
of the nearly six million employees
we insure nationwide.
We are considered among the
highest rated group life insurance
companies by the independent
rating agencies that analyze the
financial soundness and claimspaying ability of insurance
companies. For more information
about the rating agencies and to see
where our ratings rank compared
to other ratings, please visit
www.securian.com/ratings.
*L
eading writers of group life insurance based on
2011 insurance in force, as reported by A.M. Best
in July 2012.
For assistance, go to www.LifeBenefits.com/StateofTN or call 866-881-0631.
15
F77989 Rev 7-2013DOFU 12-2012
A04258-1112
©2012 Securian Financial Group, Inc. All rights reserved.
This is a summary of plan provisions related to the insurance
policy issued by Minnesota Life to State of Tennessee. In t
he event of a conflict between this summary and the policy
and/or certificate, the policy and/or certificate shall dictate the
insurance provisions, exclusions, all limitations and terms of
coverage. All elections or increases are subject to the actively
at work requirement of the policy. Products are offered under
policy form MHC-96-13180.41.
Underwritten by Minnesota Life Insurance Company
400 Robert Street North
St. Paul, MN 55101
State of Tennessee
Important Benefits
Information
Enclosed