LTD Insurance Carrier Procurement

The Commonwealth of Massachusetts, through its Group Insurance Commission (GIC), is seeking to procure a long-term disability (LTD) insurance carrier to provide coverage for over 40,000 active state employees. The selected carrier will be required to offer an LTD plan with a benefit that pays 55% of the employee's salary up to $10,000 per month, after a 90-day elimination period. The contract will have an initial 3-year term with two 1-year renewal options. Proposals are due by December 21, 2016, and the GIC aims to award the contract by February 2017, with a July 1, 2017 effective date. The procurement requires bidders to commit a specific percentage of their contract sales to certified Minority Business Enterprises (MBE), Women Business Enterprises (WBE), and Service-Disabled Veteran-Owned Business Enterprises (SDVOBE). The current LTD carrier is Unum, and all existing enrollees will transfer to the new carrier without evidence of insurability requirements. The total contract value over the initial 5-year term is estimated to be between $50-75 million, and the program is fully funded by employee insurance premiums with no employer contribution.