Number
121686
Version
SUBSTITUTE 2
Reference
Sponsor
THE CHAIR
Title
Substitute resolution approving design changes in group life insurance benefits for active general City employees and new general City retirees.
Analysis
This resolution approves a new design for group life insurance benefits for active general City employees and new retirees that includes the following features:
1. Separate rates for base benefit coverage for active employees and retirees.
2. A base benefit amount of $50,000 for active general City employees paid entirely by the City.
3. An option for active general City employees to purchase up to 300% of the value of their salaries in additional supplemental insurance paid entirely by employees at age-banded rates.
4. An option for general City employees who retire on or after January 1, 2014 to to receive $10,000 in coverage paid entirely by the City after employees attain the age of 65 if they continue at least $20,000 in coverage as retirees under age 65 at their own cost.
5. Continuing current benefit levels for retirees who are over 65 and retired on or before December 31, 2013 with premiums paid entirely by the City.
6. Continuing current benefit options for retirees who are under age 65 and retired on or before December 31, 2013 with premiums paid entirely by retirees.
7. Premium rates for all retiree life insurance coverage determined by a request-for-proposal process.
Body
Whereas, Common Council Resolution File Number 111663, adopted December 18, 2012, directed that representatives of the Department of Employee Relations, Employes' Retirement System, City Attorney's Office and Department of Administration - Budget and Management Division review the current life insurance benefit designs and make recommendations for future life insurance benefits to the Finance and Personnel Committee by May 15, 2013; and
Whereas, The workgroup met and discussed design options for group life insurance benefits for employees and retirees of the City; and
Whereas, Under the current design, the rate for employees and retirees is blended across all ages; and
Whereas, A blended rate disguises the burden of cost to provide group life insurance benefits to both active employees and retirees; and
Whereas, The blended rate design results in a system where younger active employees essentially subsidize the benefit for older retirees; and
Whereas, The group life insurance benefits of sworn fire and police employees is a subject of collective bargaining; and
Whereas, Therefore, design changes as they relate to group life insurance benefits would apply to active general City employees and new general City retirees; and
Whereas, A request-for-proposal process shall obtain the most competitive rates for retiree life insurance coverage; and
Whereas, The Department of Employee Relations recommends a new group life insurance benefit design for active general City employees and new general City retirees that includes the following features:
1. Separate rates for base benefit coverage for active employees and retirees.
2. A base benefit amount of $50,000 for active general City employees paid entirely by the City.
3. An option for active general City employees to purchase up to 300% of the value of their salaries in additional supplemental insurance paid entirely by employees at age-banded rates.
4. An option for general City employees who retire on or after January 1, 2014 to receive $10,000 in coverage paid entirely by the City after employees attain the age of 65 if they continue at least $20,000 in coverage as retirees under 65 at their own cost.
5. Continuing current benefit levels for retirees who are over age 65 and retired on or before December 31, 2013 with premiums paid entirely by the City.
6. Continuing current benefit options for retirees who are under age 65 and retired on or before December 31, 2013 with premiums paid entirely by retirees.
7. Premium rates for all retiree life insurance coverage determined by a request-for-proposal process.
; now, therefore, be it
Resolved, By the Common Council of the City of Milwaukee, that a new design for group life insurance benefits for active general city employees and new retirees is approved that includes the following features:
1. Separate rates for base benefit coverage for active employees and retirees.
2. A base benefit amount of $50,000 for active general City employees paid entirely by the City.
3. An option for active general City employees to purchase up to 300% of the value of their salaries in additional supplemental insurance paid entirely by employees at age-banded rates.
4. An option for general City employees who retire on or after January 1, 2014 to receive $10,000 in coverage paid entirely by the City after employees attain the age of 65 if they continue at least $20,000 in coverage as retirees under 65 at their own cost.
5. Continuing current benefit levels for retirees who are over age 65 and retired on or before December 31, 2013 with premiums paid entirely by the City.
6. Continuing current benefit options for retirees who are under age 65 and retired on or before December 31, 2013 with premiums paid entirely by retirees.
7. Premium rates for all retiree life insurance coverage determined by a request-for-proposal process.
Requestor
Department of Employee Relations
Drafter
LRB146237-3
Mary E. Turk
4/24/13