Group Life Insurance Coverage is a feature of respective retirement systems.
Reduced death benefits are continued after retirement in cases where an employee was a member of the Pension Plan for a minimum of ten years prior to retirement.
Employees not eligible to enroll in the State Retirement programs cannot carry life insurance through the State.
No medical examination is required unless the member attained the age of 60 prior to enrollment. For additional information, please access the link below.
Alternate Benefit Program (ABP)
ABP provides insurance for members at 3-1/2 times the participant’s annual salary over the last 12 months of creditable service, the premium for which is paid by the State, effective the day of enrollment in the program. The insurance payable during the initial year of employment is computed based upon salary earned and applied to the program. See insurance Coverage over $50,000 below for the tax liability on this benefit. For additional information, please access the link below.
Public Employees Retirement System (PERS)
Members of PERS are insured for the non-contributory group life insurance at 1-1/2 times the annual salary during the last 12 months of creditable service (date of enrollment in system). During the first year of membership, members are required to participate in the contributory coverage to provide an additional 1-1/2 times the pro-rated annual salary coverage at a cost (payroll deduction) to the employee of 0.50 of 1% of his/her annual salary. Thereafter this contributory coverage is optional. Coverage is not reduced while actively employed, even after attainment of age 70. Once contributory coverage is terminated, it cannot be reactivated. For additional information, please access the link below.
Police and Fireman’s Retirement System (PFRS)
PFRS provides insurance for members at 3-1/2 times the participant’s annual salary over the last 12 months of creditable service, the premium for which is paid by the State, effective the day of enrollment in the program. The insurance payable during the initial year of employment is computed based upon salary earned and applied to the program. See insurance Coverage over $50,000 below for the tax liability on this benefit. For additional information, please access the link below.
Life Insurance Coverage over $50,000
Internal Revenue states that the value of the premium cost of group life insurance coverage in excess of $50,000 is taxable income to the employee. Effective January 1, 1988, the Federal Revenue Act of 1987 requires that the value of Group-Term Life Insurance coverage in excess of $50,000.00 constitutes wages for F.I.C.A. tax purposes. Prior to this, the fringe benefit value was subject only to Federal and State income taxes. You have the option in November of each calendar year of canceling the insurance above $50,000. This avoids the tax liability.
The cancellation will stay in effect until a reinstate form is completed (one year minimum).
Life Insurance Claims
Claim forms will be filed by the College upon notification of an employee’s death.