RFP%2031786-00193%20Appendix%207.13%20Life%20Insurance%20Rates%20and%20Program%20Changes.docx

Table of Contents

2018-2022 BASIC TERM LIFE & BASIC AD&D DESIGN

TRADITIONAL BASIC TERM LIFE and BASIC ACCIDENTAL DEATH & DISMEMBERMENT INSURANCE ELIGIBILITY AND BENEFITS

group plan platform issued to the State of Tennessee.

Eligibility Criteria Eligibility Status

Child Age Maximum

Participation Requirements

Carryover from Prior carrier

· Employee – An individual employed by the State who: 1) is regularly scheduled to work not less than thirty (30) hours per week; 2) any person who has received a seasonal appointment and who meets the requirements set forth in TCA 8-27-201(h); or 3) is deemed eligible by applicable federal law, state law, or action of the State Insurance Committee.

· Dependent – An individual who is: 1) a legally married spouse of a State of Tennessee employee; or 2) an individual from live birth up to the age maximum who is a natural or adopted child of a State employee; a stepchild of the employee; or a child for whom that employee is the legal guardian.

The maximum age for dependent child coverage is through the end of the month in which the child reaches his birthday of 26 years.

Employee participation is required for participation of a dependent. Only one parent may cover eligible child(ren). If a person is covered as an Employee, he cannot be covered as a spouse or dependent child of another Employee.

All current employees and dependents enrolled in the State basic term life and basic accidental death & dismemberment insurance program on December 31, 2013, shall be transferred to the coverage established under this contract at the coverage levels for which the employees and dependents qualify on January 1, 2014. Individuals who have been granted a waiver of premium due to disability will remain with the incumbent carrier.

Underwriting Criteria Guaranteed Issue

Underwritten

1) Eligible Employees and dependents who apply for coverage during an open enrollment period, eligible Employees employed on and after January 1, 2014 who enroll themselves and dependents within thirty (31) days of the first day of work, and eligible Employees and/or dependents who enroll within sixty (60) days of a special qualifying event.

2) Not applicable

Effective Date of Coverage

Employee

Dependent

New hire coverage shall become effective on the first day of the month following date of hire. Open enrollment coverage shall become effective on a date specified by the State. The effective date is subject to Actively at Work requirements.

The effective date will be the same as the employee’s effective date unless the dependent is enrolled subsequent to the employee’s enrollment. The effective date for dependents enrolled subsequent to the employee will be the first of a month determined by the State.

RFP 31786-00193 Appendix 7.13 Life Insurance Rates and Program Changes

RFP 31786-00193 Appendix 7.13 Life Insurance Rates and Program Changes

Benefit Amounts

Employee and dependents

In-force coverage being transferred to the Contractor on January 1, 2014, shall transfer with the same coverage amount. The guaranteed issue amount of insurance under the Basic Term Life/Basic AD&D Insurance Program shall be as shown below.

TRADITIONAL BASIC TERM LIFE

Employee Schedule of Benefits

Employees not enrolled in the State of Tennessee’s Group Health Insurance Plan shall only have $20,000 of basic term life and shall not be eligible to add dependent coverage.

Employees enrolled in the State of Tennessee’s Group Health Insurance Plan shall have coverage based upon the employee’s annual base salary as shown in the table above.

The determination of coverage for an employee shall be based upon the employee’s age and salary as of September 1 of each year or an alternative date established by the State with the effective date of the recalculated coverage to be on October 1 of the same year or on an alternative date established by the State.

The amount of basic term life insurance coverage for the employee begins to decrease at age

65. Reductions are to 65 percent of the scheduled amount at age 65; to 45 percent at age 70; and to 30 percent at age 75. Basic Term Life face amounts do not reduce at age 70 or above for those employees enrolled in the State’s Permaplan program.

Dependent Schedule of Benefits Definition Amount Eligible Dependents of Insured who are:

TRADITIONAL BASIC ACCIDENTAL DEATH AND DISMEMBERMENT (AD&D)

Schedule of Benefits

Employees with Base Annual Earnings of:

Family Coverage

Spouse Only (No Children) Spouse and Children

Spouse

Each Child

Under Age 65 Age 65 but Under 70 Age 70 but Under 75 Age 75 or Over Less than $15,000 $20,000 $13,000 $ 9,000 $ 6,000 $15,000 but less than $17,500 $22,000 $14,300 $ 9,900 $ 6,600 $17,500 but less than $20,000 $25,000 $16,250 $11,250 $ 7,500 $20,000 but less than $22,500 $30,000 $19,500 $13,500 $ 9,000 $22,500 but less than $25,000 $33,500 $21,775 $15,075 $10,050 $25,000 but less than $27,500 $37,000 $24,050 $16,650 $11,100 $27,500 but less than $30,000 $40,500 $26,325 $18,225 $12,150 $30,000 but less than $32,500 $44,000 $28,600 $19,800 $13,200 $32,500 but less than $35,000 $47,500 $30,875 $21,375 $14,250 $35,000 and over $50,000 $32,500 $22,500 $15,000

The amount of basic accidental death and dismemberment coverage for the employee and dependent(s) begin to decrease at age 65. Reductions are to 65 percent of the scheduled amount at age 65; to 45 percent at age 70; and to 30 percent at age 75. Basic accidental death and dismemberment face amounts do not reduce at age 70 or above for those employees enrolled in the State’s Permaplan program and their dependents.

Table of Losses These losses must:

1. Be the result of bodily injury caused solely by accident and independent of all other causes;

2. Occur within 90 days of the date of the accident; and

3. Be losses for which Proof of Loss is submitted within 180 days of the accident.

Accidental Death Both hands or both feet Sight of both eyes THE MAXIMUM BENEFIT One hand and one foot One hand and sight of one eye One foot and sight of one eye

Sight of one eye

Thumb and index finger of ONE-FOURTH either hand THE MAXIMUM BENEFIT

The amount of payment will be determined by the Maximum Benefit shown for this coverage in the Schedule of Benefits. With respect to hands or feet, “loss” means actual severance at or above wrist or ankle joints; with respect to eyes, permanent and total loss of sight; with respect to thumb and index finger, actual severance of entire digit at or above joints.

No more than 100 percent of the Maximum Benefit will be paid for any one accident, no matter how many of the above listed losses occur as a result of that accident.

Limitations There are some limitations. A benefit will not be paid if the accident results from or is due to:

1. Any disease or infirmity of mind or body, and any medical or surgical treatment thereof;

2. Suicide or attempted suicide, while sane or insane;

3. Any intentionally self-inflicted injury;

4. War, declared or undeclared war, whether or not you are a member of any armed force;

5. Commission of, participation in, or an attempt to commit an assault or felony;

6. Being under the influence of any narcotic, hallucinogen, barbiturate, gas or fumes, poison or any other controlled substance as defined in Title II of the Comprehensive Drug Abuse Prevention and Control Act of 1970, as now or hereafter amended, unless as prescribed by the Insured’s licensed physician. Conviction is not necessary for a determination of being under the influence;

7. Intoxication as defined by the laws of the jurisdiction in which the accident occurred. Conviction is not necessary for a determination of being intoxicated; or

8. Active participation in a riot. “Riot” means all forms of public violence, disorder, or disturbance of the public peace, by three or more persons assembled together, whether with or without a common intent and whether or not damage to person or property or unlawful act is the intent or the consequence of such disorder.

Limitations. There are some limitations on the advanced benefit option. A benefit will not be paid if:

1. The terminal illness resulted from attempted suicide or self-inflicted injury;

2. The coverage has been assigned;

3. The coverage is payable to an irrevocable beneficiary;

4. You are required by law to use this option to meet the claims of creditors; or

5. You are required by a government agency to use this option in order to get or keep a government benefit or entitlement.

If the employee dies as the result of an accident which occurs more than 75 miles from the employee’s principal residence, a supplemental benefit of up to $5,000 for preparation and transportation of the body will be paid. The accident must qualify for the provision of basic accidental death and dismemberment benefits for the repatriation benefit to be provided.

1. apply within twelve months following the last day of the month following end of positive pay status;

2. provide proof of the disability each year that is satisfactory to the Contractor; and

3. remain totally disabled.

If the employee is disabled between age 60 through age 69 and becomes totally disabled, the employee’s basic term life coverage will continue for one year from the last day of the month following end of positive pay status.

Any amount payable under the Waiver of Premium or one year extension provision will be reduced by the amount of a conversion policy. The employee is not allowed to increase coverage above the level the employee had as an active employee. The conversion policy can be surrendered and the employee would be eligible for full coverage under the extension and approved Waiver of Premium claim.

There are no extended benefits for the basic accidental death and dismemberment coverage.

The beneficiary for all dependent coverage and for the dismemberment coverage is the employee.

If two or more persons are designated beneficiaries and the employee does not indicate otherwise, they will share the benefits equally. If one of them does not survive the employee, that share will pass to the surviving beneficiaries.

If no beneficiary is designated, the benefits will be paid to the employee’s spouse, if living; if not, to the employee’s children in equal shares, if living; if not, to the employee’s parents in equal shares, if living; if not, to the employee’s estate.

· The date the Member’s premiums are not paid when due, subject to the Grace Period;

· The Group Policy providing this coverage is terminated;

· The member no longer meets the eligibility definition for the Program;

The Contractor will send a notice concerning the former employee’s eligibility to continue coverage. Payment of premium will be made directly to the Contractor by the former employee. Dependents may exercise a conversion option when they become ineligible for coverage, as well.

If the employee or dependent dies during the 31-day period following the termination of insurance, the Contractor shall pay the maximum amount of life insurance for which an individual policy could have been issued.

2018-2022 VOLUNTARY AD&D DESIGN

TRADITIONAL OPTIONAL ACCIDENTAL DEATH & DISMEMBERMENT INSURANCE ELIGIBILITY AND BENEFITS

Eligibility Criteria

Eligibility Status

· Employee – An individual employed by the State who: 1) is regularly scheduled to work not less than thirty (30) hours per week; 2) is a seasonal or part-time employee with 24 months of service and is certified by an appointing authority to work at least 1,450 hours per fiscal year; or 3) is deemed eligible by applicable federal law, state law, or action of the State Insurance Committee.

· Dependent – An individual who is: 1) a legally married spouse of a State of Tennessee employee; or 2) an individual from live birth up to the age maximum who is a natural or adopted child of a State employee; a stepchild of the employee; or a child for whom that employee is the legal guardian.

eligible child(ren). If a person is covered as an Employee, he cannot be covered as a spouse or dependent child of another Employee.

coverage established under this contract at the coverage levels for which the employees and dependents qualify on January 1, 2014.

Underwriting Criteria Guaranteed Issue

Eligible Employees and dependents who apply for coverage during an open enrollment period, eligible Employees employed on and after January 1, 2014 who enroll themselves and dependents within thirty (31) days of the first day of work, and eligible Employees and/or dependents who enroll within sixty (60) days of a special qualifying event.

Not applicable

Effective Date of Coverage

Dependent

New hire coverage shall become effective on the first day of the month following date of hire Open enrollment coverage shall become effective on a date specified by the State; normally January 1 subsequent to the Annual Enrollment Period. The effective date is subject to Actively at Work requirements.

The effective date will be the same as the employee’s effective date unless the dependent is enrolled subsequent to the employee’s enrollment. The effective date for dependents enrolled subsequent to the employee will be the first of a month determined by the State.

Benefit Amounts Employee and dependents

In-force coverage being transferred to the Contractor on January 1, 2014, shall transfer with the same coverage amount. The guaranteed issue amount of insurance under the Traditional Optional AD&D Insurance Program shall be as shown below.

TRADITIONAL OPTIONAL ACCIDENTAL DEATH & DISMEMBERMENT (AD&D)

Schedule of Benefits

Family Coverage

Spouse Only (No Children) Spouse and Children

Each Child

$9,000 but less than $10,000

$10,000 but less than $12,500

$12,500 but less than $15,000

$15,000 but less than $17,500

$17,500 but less than $20,000

The determination of coverage for an employee shall be based upon the employee’s age and salary as of September 1 of each year or an alternative date established by the State with the effective date of the recalculated coverage to be on October 1 of the same year or on an alternative date established by the State.

Please refer to the Basic Accidental Death and Dismemberment coverage.

Limitations Please refer to Basic Accidental Death and Dismemberment coverage.

Reductions There are no age benefit reductions in the Optional Accidental Death and Dismemberment coverage.

The beneficiary for all dependent coverage and for the dismemberment coverage is the employee.

If two or more persons are designated beneficiaries and the employee does not indicate otherwise, they will share the benefits equally. If one of them does not survive the employee, that share will pass to the surviving beneficiaries.

If no beneficiary is designated, the benefits will be paid to the employee’s spouse, if living; if not, to the employee’s children in equal shares, if living; if not, to the employee’s parents in equal shares, if living; if not, to the employee’s estate.

· The date the Member’s premiums are not paid when due, subject to the Grace Period;

· The Group Policy providing this coverage is terminated;

· The member no longer meets the eligibility definition for the Program;

2018-2022 VOLUNTARY TERM LIFE DESIGN

VOLUNTARY TERM LIFE INSURANCE BENEFITS

Plan Policy Requirements The voluntary term life insurance must be based on a group plan platform issued to the State of Tennessee.

State of Tennessee.

Underwriting Criteria

Guaranteed Issue

1) Eligible Employees who apply for coverage during an open enrollment period or Employees employed on and after January 1, 2018 who enroll within thirty-one days of the hire date on a guaranteed issue and maximum issue basis.

2) A spouse who has not been hospitalized, advised to seek medical treatment, or received disability benefits during the six months prior to the date of the application to enroll

3) A child term rider may be issued without answering health questions for the children.

1) New Employees who choose to apply for coverage more than 31 days after their hire date;

2) A Member who applies for a coverage amount above the guaranteed issue amount:

and

3) A spouse who has been hospitalized, advised to seek medical treatment, or received disability benefits during the six months prior to the date of the application to enroll.

Benefit Amounts/Maximum Amounts

Child Term Rider

Revisions

In-force active and ported certificates of coverage being transferred to the Contractor on January 1, 2018, shall transfer with the same coverage amount.

The guaranteed issue amount of insurance under the Voluntary Term Life Insurance Plan shall be five (5) times the employee’s Annual Base Salary, rounded to the next highest $5,000 increment. The minimum base amount is $5,000 for each employee. The maximum issue amount of insurance under the Voluntary Term Life Insurance Program shall be seven (7) times Annual Base Salary, then rounded to the next highest $5,000 increment up to a maximum of $500,000. A participating employee may increase his or her face value of coverage annually by $5,000 subject to the guaranteed issue amount and maximum coverage on a date mutually established by the State and the Contractor.

In-force active and ported certificates of coverage being transferred to the Contractor on January 1, 2018, shall transfer with the same coverage amount.

Spouse under age 55: increments of $5,000 up to a maximum of $30,000.

Spouse age 55 and over: increments of $5,000 up to a maximum of $15,000.

All child term riders in force as of December 31, 2017, including those in the amount of $2,500, shall carryover to the Contractor as of January 1, 2018.

A new child term rider to be effective January 1, 2018 or later shall be issued in the amount of $5,000 or $10,000.

The State reserves the right to negotiate with the Contractor to increase the maximum issue amounts and to adjust the unit rates based on the increase in coverage. Such changes would be effected through an amendment to the contract.

Each year during a time period specified by the State, current members may increase the face amount of their coverage by up to $5,000 if that action will not exceed the guaranteed issue amount, without answering health questions.

In the event an individual is approved for coverage through medical underwriting, that coverage will be in full force on the general effective date unless limited by another provision of the Group Master Policy.

(1) The Group Policy has not terminated;

(2) Acceptable evidence of insurability, at the Member’s cost, is submitted to the Contractor; and

(3) A premium is paid which is sufficient to keep the insurance in force for at least three (3) months after the reinstatement.

For an Employee Member whose employment is terminated or a Spouse Member who becomes ineligible for coverage because of the Employer’s eligibility rules, the following options will apply:

(1) If younger than age 70, the Certificate may be:

a. Continued by paying the premiums on a direct bill basis to the Contractor. If this option is elected, the coverage provided by the Certificate will automatically terminate on the last day of the year in which age 70 is obtained. A request to convert to an individual life policy may be made within 31 days of when the Certificate terminates at age 70; or

b. Converted to an individual life policy.

(2) If age 70 or older, the Certificate may be converted to an individual life policy.

The above options will not be available if the Member fails to notify the Contractor of a change in the eligibility status of the Spouse.

If conversion to an individual life policy is chosen by the Member as described above, the application must be made for the policy within 31 days from the date of the notification offering the conversion. Proof of insurability will not be required. The premium for the policy will be based upon the Member’s:

(1) Age;

(2) Class of risk; and

(3) The policy form and face amount of the policy.

If the Member dies during the 31 day period before applying for an individual life policy, the amount of life insurance he/she had under the Certificate will be paid to the beneficiary.

If the life insurance provided by the Group Policy has been in effect for at least five (5) years and the Plan ends or the Plan ceases to include a Member’s class of employees, coverage may be converted to an individual life policy, subject to the same conversion restrictions above, except as provided below. The converted policy will be limited to the less of:

(1) The amount of life insurance the Member had under the Plan, less any amount of life insurance the Member becomes eligible for under another group policy within 31 days after the Plan ends; or

(2) $2,000.

2023 - 2027 VOLUNTARY TERM LIFE DESIGN

VOLUNTARY TERM LIFE INSURANCE BENEFITS

Plan Policy Requirements The voluntary term life insurance must be based on a group policy platform issued to the State of Tennessee. Member’s coverage shall be as described in approved Certificates of Coverage to be distributed to Subscribers.

Each year during a time period specified by the State, current active Subscribers (employees) may without answering health questions increase the face amount of their coverage by up to $5,000 if that action will not exceed the guaranteed issue amount.

Benefit Amounts/ Maximum Amounts

Child Term Rider

Revisions

In-force active and ported certificates of coverage being transferred to the Contractor on January 1, 2023, shall transfer with the same coverage amount unless a change was made during the 2023 annual enrollment period by active employees.

The guaranteed issue amount of insurance under the Voluntary Term Life Insurance Program shall be five (5) times the employee’s Annual Base Salary, rounded to the next highest $5,000 increment. The minimum base amount is $5,000 for each employee. The maximum issue amount of insurance under the Voluntary Term Life Insurance Program shall be seven (7) times Annual Base Salary, then rounded to the next highest $5,000 increment up to a maximum of $500,000. A participating employee may increase his or her face value of coverage annually by $5,000 subject to the guaranteed issue amount and maximum coverage on a date mutually established by the State and the Contractor.

In-force active and ported certificates of coverage being transferred to the Contractor on January 1, 2023, shall transfer with the same coverage amount unless a change was made during the 2023 annual enrollment period by active spouses.

Spouse under age 55: increments of $5,000 up to a maximum of $30,000.

Spouse age 55 and over: increments of $5,000 up to a maximum of $15,000.

All child term riders in force as of December 31, 2022, including those in the amount of $2,500, shall carryover to the Contractor as of January 1, 2023.

A new child term rider to be effective January 1, 2023 or later shall be issued in the amount of $5,000 or $10,000.

The State reserves the right to negotiate with the Contractor to increase the maximum issue amounts and to adjust the unit rates based on the increase in coverage. Such changes would be implemented through a contract amendment.

Limitations. There are some limitations on the advance benefit option. A benefit will not be paid if:

1. The terminal illness resulted from attempted suicide or self-inflicted injury;

2. The coverage has been assigned;

3. The coverage is payable to an irrevocable beneficiary;

4. You are required by law to use this option to meet the claims of creditors; or You are required by a government agency to use this option in order to get or keep a government benefit or entitlement.

In the event an individual is approved for coverage through medical underwriting, that coverage will be in full force on the general effective date unless limited by another provision of the Group Master Policy.

(4) The Group Policy has not terminated;

(5) Acceptable evidence of insurability, at the Member’s cost, is submitted to the Contractor; and

(6) A premium is paid which is sufficient to keep the insurance in force for at least three (3) months after the reinstatement.

For an Employee Member whose employment is terminated or a Spouse Member who becomes ineligible for coverage because of the Employer’s eligibility rules, the following options will apply:

(3) If younger than age 70, the Certificate may be:

c. Continued by paying the premiums on a direct bill basis to the Contractor. If this option is elected, the coverage provided by the Certificate will automatically terminate on the last day of the year in which age 70 is obtained. A request to convert to an individual life policy may be made within 31 days of when the Certificate terminates at age 70; or

d. Converted to an individual or term life policy.

(4) If age 70 or older, the Certificate may be converted to an individual or term life policy.

The above options will not be available if the Member fails to notify the Contractor of a change in the eligibility status of the Spouse.

If conversion to an individual or term life policy is chosen by the Member as described above, the application must be made for the policy within 31 days from the date of the notification offering the conversion. Proof of insurability will not be required. The premium for the policy will be based upon the Member’s:

(4) Age;

(5) Class of risk; and

(6) The policy form and face amount of the policy.

If the Member dies during the 31-day period before applying for an individual life or term policy, the amount of life insurance they had under the Certificate will be paid to the beneficiary.

If the life insurance provided by the Group Policy has been in effect for at least five (5) years and the Plan ends or the Plan ceases to include a Member’s class of employees, coverage may be converted to an individual life policy, subject to the same conversion restrictions above, except as provided below. The converted policy will be limited to the less of:

(3) The amount of life insurance the Member had under the Plan, less any amount of life insurance the Member becomes eligible for under another group policy within 31 days after the Plan ends; or

(4) $2,000.

RFP 31786-00193 VOLUNTARY TERM LIFE PLAN BENEFIT CHANGES

Voluntary Term Life

2023 BASIC TERM LIFE & BASIC AD&D DESIGN

TRADITIONAL BASIC TERM LIFE and BASIC ACCIDENTAL DEATH & DISMEMBERMENT INSURANCE BENEFITS

Benefit Amounts

TRADITIONAL BASIC TERM LIFE

Coverage shall be one and one-half (1&1/2) times the employee’s base annual salary with a minimum coverage amount of $20,000 and a maximum coverage amount of $50,000. The employee may elect to enroll only in the coverage paid by the State.

The determination of coverage for an employee shall be based upon the employee’s age and salary as of September 1 of each year or an alternative date established by the State with the effective date of the recalculated coverage to be on October 1 of the same year or on an alternative date established by the State.

The amount of basic term life insurance coverage for the employee begins to decrease at age 65. Reductions are to 65 percent of the scheduled amount at age 65; to 45 percent at age 70; and to 30 percent at age 75. Basic Term Life coverage amounts do not reduce at age 70 or above for those employees enrolled in the State’s Permaplan program. Basic term life insurance coverage for dependents does not reduce.

Dependent Schedule of Benefits Definition Amount Enrolled Dependents of Insured Employee who are:

TRADITIONAL BASIC ACCIDENTAL DEATH AND DISMEMBERMENT (AD&D)

Schedule of Benefits

The employee’s basic AD&D coverage shall be two (2) times the employee’s basic term life coverage amount.

Enrolled dependents’ coverage amount shall be:

Spouse Only Enrolled – 60% of employee’s basic AD&D amount Spouse and Children Enrolled Spouse 40% of employee’s basic AD&D amount Each child’s coverage shall be 10% of employee’s basic AD&D amount Children Only Enrolled – Each child’s coverage shall be 10% of employee’s basic AD&D amount

The amount of basic accidental death and dismemberment coverage for the employee and dependent(s) begin to decrease at age 65. Reductions are to 65 percent of the scheduled amount at age 65; to 45 percent at age 70; and to 30 percent at age 75. Basic accidental death and dismemberment face amounts do not reduce at age 70 or above for those employees enrolled in the State’s Permaplan program and their dependents.

These losses must:

1. Be the result of bodily injury caused solely by accident and independent of all other causes;

2. Occur within 90 days of the date of the accident; and

3. Be losses for which Proof of Loss is submitted within 180 days of the accident.

Accidental Death Both hands or both feet Sight of both eyes One hand and one foot One hand and sight of one eye One foot and sight of one eye

THE MAXIMUM BENEFIT

One hand One foot Sight of one eye

ONE-HALF

THE MAXIMUM BENEFIT

Thumb and index finger of either hand

ONE-FOURTH

THE MAXIMUM BENEFIT

The amount of payment will be determined by the Maximum Benefit shown for this coverage in the Schedule of Benefits. With respect to hands or feet, “loss” means actual severance at or above wrist or ankle joints; with respect to eyes, permanent and total loss of sight; with respect to thumb and index finger, actual severance of entire digit at or above joints.

No more than 100 percent of the Maximum Benefit will be paid for any one accident, no matter how many of the above listed losses occur as a result of that accident.

Limitations There are some limitations. A benefit will not be paid if the accident results from or is due to:

1. Any disease or infirmity of mind or body, and any medical or surgical treatment thereof;

2. Suicide or attempted suicide, while sane or insane;

3. Any intentionally self-inflicted injury;

4. War, declared or undeclared war, whether or not you are a member of any armed force;

5. Commission of, participation in, or an attempt to commit an assault or felony;

6. Being under the influence of any narcotic, hallucinogen, barbiturate, gas or fumes, poison or any other controlled substance as defined in Title II of the Comprehensive Drug Abuse Prevention and Control Act of 1970, as now or hereafter amended, unless as prescribed by the Insured’s licensed physician. Conviction is not necessary for a determination of being under the influence;

7. Intoxication as defined by the laws of the jurisdiction in which the accident occurred. Conviction is not necessary for a determination of being intoxicated; or

8. Active participation in a riot. “Riot” means all forms of public violence, disorder, or disturbance of the public peace, by three or more persons assembled together, whether with or without a common intent and whether or not damage to person or property or unlawful act is the intent or the consequence of such disorder.

Limitations. There are some limitations on the advance benefit option. A benefit will not be paid if:

1. The terminal illness resulted from attempted suicide or self-inflicted injury;

2. The coverage has been assigned;

3. The coverage is payable to an irrevocable beneficiary;

4. You are required by law to use this option to meet the claims of creditors; or

5. You are required by a government agency to use this option in order to get or keep a government benefit or entitlement.

Supplemental Basic AD&D Benefits

A supplemental basic accidental death benefit is payable if the employee dies as a result of an automobile accident for which a basic accidental death and dismemberment benefit is paid and the employee was properly secured by a seatbelt. The vehicle must have been operated by a licensed driver who was not intoxicated, driving while impaired, or under the influence of certain substances. The benefit will be the lesser of: $25,000; the basic accidental death and dismemberment benefit; or $1,000 if an official police report certifying proper seatbelt use is not submitted with the claim.

If the employee dies as the result of an accident which occurs more than 75 miles from the employee’s principal residence, a supplemental benefit of up to $5,000 for preparation and transportation of the body will be paid. The accident must qualify for the provision of basic accidental death and dismemberment benefits for the repatriation benefit to be provided.

In addition, if the employee becomes totally and permanently disabled before age 60 and remains disabled for nine consecutive months, the employee may be eligible to continue the basic term life coverage on him/herself and his covered dependents until the employee turns age 70. The Contractor determines whether the employee’s disability is considered total and permanent. To be granted a continuation under the waiver of premium provision the employee must:

1. apply within twelve months following the last day of the month following end of positive pay status;

2. provide proof of the disability each year that is satisfactory to the Contractor; and

3. remain totally disabled.

Any amount payable under the Waiver of Premium or one year extension provision will be reduced by the amount of a conversion policy. The employee is not allowed to increase coverage above the level the employee had as an active employee. The conversion policy can be surrendered and the employee would be eligible for full coverage under the extension and approved Waiver of Premium claim.

There are no extended benefits for the basic accidental death and dismemberment coverage.

The beneficiary for all dependent coverage and for the dismemberment coverage is the employee.

If two or more persons are designated beneficiaries and the employee does not indicate otherwise, they will share the benefits equally. If one of them does not survive the employee, that share will pass to the surviving beneficiaries.

If no beneficiary is designated, the benefits will be paid according to the Contractor’s standard order of payment.