Table of Contents
Introduction ........................................................................................... 1
Your Life and AD&D Benefits At-A-Glance ....................................... 2
Basic Life Insurance .............................................................................. 3
When Coverage Begins ............................................................................................................................................................... 3
Cost ............................................................................................................................................................................................ 3
Coverage Amount ...................................................................................................................................................................... 3
Coverage Amount When You
Reach Age 65 ........................................................................................................................ 4
Coverage Amount If Your
Earnings Change ....................................................................................................................... 4
Excess Life Imputed Income ...................................................................................................................................................... 4
When Benefits Are Paid ............................................................................................................................................................. 5
When Benefits Are Not Paid ..................................................................................................................................................... 5
When Your Employment Status Changes .................................................................................................................................. 5
Short-Term Disability .......................................................................................................................................................... 5
If You Become Totally Disabled ........................................................................................................................................... 5
If You Are On a Leave of Absence ...................................................................................................................................... 6
If You Are Laid Off .............................................................................................................................................................. 6
When Coverage Ends ................................................................................................................................................................. 6
Converting to an Individual Policy ............................................................................................................................................ 6
Benefits for Death During the Conversion Period .............................................................................................................. 7
Business Travel Accident Insurance
............................................. 8
When Coverage Begins .............................................................................................................................................................. 8
Cost ............................................................................................................................................................................................ 8
Coverage ..................................................................................................................................................................................... 8
Exclusions .................................................................................................................................................................................. 8
Accidental Death and Dismemberment (AD&D) Insurance
(Voluntary Coverage) .......................................................................... 9
When Coverage Begins ............................................................................................................................................................... 9
For Yourself ......................................................................................................................................................................... 9
For Your Dependents .......................................................................................................................................................... 9
Cost ............................................................................................................................................................................................ 9
Coverage Amount .................................................................................................................................................................... 10
For Yourself ....................................................................................................................................................................... 10
For Your Dependents ........................................................................................................................................................ 10
Change in Coverage Amount .................................................................................................................................................... 11
Changing Coverage Levels
During the Year .................................................................................................................... 11
Coverage Amount If Your
Earnings Change ..................................................................................................................... 12
Coverage Amount After Age 70 ......................................................................................................................................... 12
Additional Benefits .................................................................................................................................................................. 12
Rehabilitation Benefit ......................................................................................................................................................... 12
Seat Belt Bonus Benefit ...................................................................................................................................................... 13
Monthly Coma Benefit ....................................................................................................................................................... 13
Special Benefits for Family Coverage
................................................................................................................................ 14
Maximum Benefit Amount ...................................................................................................................................................... 14
When Benefits Are Paid ........................................................................................................................................................... 15
When Benefits Are Not Paid ................................................................................................................................................... 15
When Your Employment Status Changes ................................................................................................................................ 17
Disability ........................................................................................................................................................................... 17
If You Are On a Leave of Absence .................................................................................................................................... 17
If You Are Laid Off ............................................................................................................................................................ 17
If You Retire or Terminate Employment ............................................................................................................................ 17
When Coverage Ends ............................................................................................................................................................... 17
Converting to an Individual Policy .......................................................................................................................................... 18
Benefits for Death During the Conversion Period ............................................................................................................ 18
Group Universal Life Insurance ..................................................... 19
When Coverage Begins ............................................................................................................................................................. 19
For Yourself ....................................................................................................................................................................... 19
For Your Dependents ........................................................................................................................................................ 19
Cost .......................................................................................................................................................................................... 20
Cost Adjustments ............................................................................................................................................................... 20
Coverage Amount .................................................................................................................................................................... 20
Accelerated Payment Benefit ................................................................................................................................................... 21
Change in Coverage Amount .................................................................................................................................................... 21
Changing Coverage Levels During
the Year .................................................................................................................... 21
Coverage Amount If Your
Earnings Change ..................................................................................................................... 21
Evidence of Insurability ........................................................................................................................................................... 22
Cash Accumulation Fund ......................................................................................................................................................... 23
When Benefits Are Paid ........................................................................................................................................................... 24
When Benefits Are Not Paid ................................................................................................................................................... 24
Suicide Provision ............................................................................................................................................................... 24
When Your Employment Status Changes ................................................................................................................................ 24
If You Become Totally Disabled ......................................................................................................................................... 24
If You Take a Leave of Absence ......................................................................................................................................... 24
If You Are Laid Off ............................................................................................................................................................ 25
If You Retire ....................................................................................................................................................................... 25
When Coverage Ends ............................................................................................................................................................... 25
For Yourself ....................................................................................................................................................................... 25
For Your Dependents ........................................................................................................................................................ 25
Continuing Your Coverage ....................................................................................................................................................... 25
Receiving Benefits ............................................................................... 27
If You Die ................................................................................................................................................................................ 27
If Your Dependent Dies ........................................................................................................................................................... 27
Beneficiary Designations ......................................................................................................................................................... 27
The Beneficiary is Younger than Age 18 ............................................................................................................................ 28
If You Are Divorced ........................................................................................................................................................... 28
If Your Legal Residence is in California
or Another Community Property State ............................................................... 28
Optional Methods of Payment ................................................................................................................................................ 29
Assignment .............................................................................................................................................................................. 29
Filing a Claim ........................................................................................................................................................................... 29
Terms You Should Know...................................................................... 30
Introduction
The Company offers
several life and accident insurance plans that, in combination, can help
provide financial security for you and your family. The Company provides Basic
Life and Business Travel Accident Insurance at no cost to you. In addition, you
may be eligible to purchase Accidental Death and Dismemberment (AD&D)
Insurance and Group Universal Life (GUL) Insurance for yourself, your spouse
and/or your dependent children.
An “At-A-Glance” chart
of your life insurance options is on the next page, followed by detailed
information about the plans.
Your Life and AD&D Benefits At-A-Glance
|
Plan Name
|
Coverage Amount
|
Who Pays
|
Evidence of Insurability
|
|
Basic Life
|
One times annual earnings (rounded to the nearest $100)
|
The Company
|
Not required
|
|
Business Travel
Accident
|
$400,000
|
The Company
|
Not required
|
|
Accidental
Death and Dismemberment (Management
& nonrepresented nonmanagement employees)
|
n
For
you—2, 4, 6, 8 or 10 times your annual earnings up to a maximum of
$500,000 (rounded up to the higher $1,000)
n
For
your family—is based on your family's structure. If your family is made
up of:
1. You and your spouse—your spouse will be
covered for 60% of your coverage amount.
2. You and your dependent children*—your
children will be covered for 15% of your coverage amount.
3. You, your spouse and dependent
children*—your spouse will be covered for 50% of your coverage amount and
your children will be covered for 10% of your coverage amount.
*The maximum coverage amount for children is $50,000.
|
You—through after-tax payroll deductions
|
Not required
|
|
Group Universal Life
|
n
For
you—1, 2, 3, 4 or 5 times your annual earnings (rounded up to the nearest
$1,000) to a maximum of 5 times your annual earnings, or $4,000,000,
whichever is less
n
For
your spouse—$10,000 increments up to the lesser of $100,000 or 3 times
your annual earnings rounded to the higher $10,000
n
For
your children— $10,000.
|
You—through after-tax payroll deductions
|
May be required.
See “Evidence of Insurability” on page 22 for more detailed information
|
Basic Life Insurance
The
Company provides you with Basic Life Insurance that pays benefits to your
family in the event of your death.
When Coverage Begins
Your Basic Life
Insurance coverage will automatically start on the first day of the month
following your eligibility date.
If you are absent from
work for any reason including illness, disability or leaves of absence, you
are considered to be an inactive employee. If you are an inactive
employee on the date coverage is scheduled to begin, your coverage will become
effective on the first day of the month after you
return to active work. If you return to work on the first day of the month,
then coverage will begin on that day.
Cost
The Company pays the
full cost of your Basic Life Insurance coverage. You pay nothing.
Coverage Amount
The Company provides you
with one times your annual earnings (rounded to the nearest $100).
If you die while
employed by the Company or within 31 days following separation from service,
your beneficiary(ies) will receive
the benefit provided.
Example:
Let’s assume that Janet has
elected one times salary coverage and her annual
earnings are $33,820 when she dies.
Her beneficiary will receive:
1 x $33,820 = $33,800
(rounded to the nearest $100).
Coverage Amount When You Reach Age 65
If you continue working for the Company past age 65, the amount of your
life insurance will be adjusted as follows:
|
Active Employees Age 65 or Older
|
|
Age
|
Percentage of
Coverage Amount
|
|
On your 65th
birthday to age 69
|
65%
|
|
On your 70th
birthday and older
|
45%
|
Example:
Let’s assume Tom is age 66 and
still an employee, he has selected coverage of one times salary and his annual
earnings are $47,000 when he dies. His beneficiary will receive: $47,000 x 65%
= $30,550, rounded up to $30, 600.
Coverage Amount If Your Earnings Change
Because your coverage
amount is based on your earnings, the amount of your coverage is adjusted when
your earnings change. This adjustment to your life insurance coverage occurs on
the first day of the month coinciding with or following the date your earnings
change.
If the amount of your
coverage will increase due to an earnings increase, you must be actively at work in order for the increase in coverage to
take effect. If you are not actively at work on that date, your increase in
coverage will take effect on the first day of the month after you return to
active work.
Excess Life Imputed Income
The IRS considers the
cost of any Company-paid life insurance coverage over $50,000 to be a part of
your taxable income for federal income tax purposes. This amount, called imputed income, will be reflected on
your paycheck as “Excess Life” and will also be reported as taxable income on
your W-2 Form each year.
When Benefits Are Paid
Your beneficiary will
receive full benefits (your coverage amount) if you die for any reason while
covered under this plan. The insurance company will automatically set up a
checking account for benefits over $10,000 and will send your beneficiary a
checkbook. Please contact the insurance company for details.
When Benefits Are Not Paid
The plan does not pay
benefits under the following circumstances:
n
You die
while not covered under the plan and
n
You die
after the 31-day conversion period (see “Converting to an Individual Policy” on
page 6).
When Your
Employment Status Changes
Short-Term Disability
If you
are unable to work due to a short-term illness or injury, your Basic Life
Insurance coverage will continue at no cost to you.
If You Become Totally Disabled
If you become totally disabled before age 65 and while
covered, your Basic Life Insurance coverage will continue at no cost to you
while you remain disabled.
Your Basic Life
Insurance coverage will be the amount in effect when you became disabled and
will continue as long as you remain totally disabled, until you reach age 65 or
terminate employment, whichever occurs first.
If your
total disability continues past age 65 as a result of a disability that
occurred after age 61, your insurance amount will be reduced as described
earlier on page 4, the same as an active employee until your scheduled
disability payments end.
If your disability ends
or you reach the maximum disability period, your coverage will end 31 days
after the date your disability ends unless you return to work or are eligible
to retire.
If You Are On a Leave of Absence
If you are on an
approved leave of absence, your Basic Life Insurance may continue until the end
of the month after the month in which your leave of absence began.
If You Are Laid Off
If you are laid off,
your Basic Life Insurance coverage may continue until the end of the month
after the month in which you were laid off. During this time you may apply for
a conversion policy by contacting the insurance carrier.
When Coverage Ends
Your Basic Life
Insurance coverage ends on:
n
The day you
stop working for the Company for any reason other than total disability or
retirement
n
The day you
are no longer eligible for coverage
n
The day the
plan terminates
n
The first
day of the month following the month in which you take a leave of absence
n
The first
day of the month following the month in which you are laid off
n
The day you
are suspended.
Converting
to an Individual Policy
If your Basic Life
Insurance coverage ends, you have the option to convert your group coverage to
an individual policy, without submitting Evidence
of Insurability. You must, however, apply for your converted insurance
policy before the conversion period
ends. The conversion period is the 31-day period following the date your Basic
Life Insurance coverage ends.
The coverage amount of
your converted policy cannot be more than the coverage amount under the Basic
Life Insurance on the date your coverage ends. If you convert to an individual
insurance policy, you will be required to pay the insurance company the standard
premium rate for your converted policy.
Contact John Hancock at
1-800-REAL LIFE or 1-800-695-7389 to find the nearest John Hancock agent if you
are interested in converting to an individual life insurance policy.
Benefits for Death During the Conversion Period
If you die during the
31-day conversion period, the insurance company will pay a benefit to your
named beneficiary whether or not you had applied for conversion to an
individual policy.
Business Travel Accident Insurance
The Company provides you
with Business Travel Accident Insurance that pays benefits to your family if
you die while traveling on business.
When Coverage Begins
Your Business Travel
Accident Insurance coverage will automatically start on the first day of the
month following your date of hire.
If you
are absent from work for any reason including illness, disability or leaves of
absence, you are considered to be an inactive employee. If you are an inactive
employee on the date coverage is scheduled to begin, your coverage will become
effective when you return to active work.
Cost
The Company pays the
full cost of your Business Travel Accident Insurance coverage.
You pay nothing.
Coverage
The Company provides
$400,000 in coverage for Business Travel Accident Insurance. If you die in an
accident while traveling on business, your beneficiary will receive a benefit
from the Business Travel Accident Plan.
Exclusions
Benefits are not payable
in the event of any of the following:
n
Travel to
and from work
n
Accidents
while you are on a leave of absence or vacation
n
Intentionally
self-inflicted injury, attempted suicide or suicide
n
Serving as a
pilot or crew member of an aircraft.
Accidental Death and Dismemberment (AD&D) Insurance
(Voluntary Coverage)
The Company offers
management and nonrepresented, nonmanagement employees the opportunity to
purchase Accidental Death and Dismemberment (AD&D) Insurance.
When Coverage Begins
For Yourself
Your coverage will
become effective on the first day of the month following your eligibility date,
provided that you have returned a signed
enrollment form within 31 days of your eligibility date. If you do not
enroll within this 31-day period, your next chance to enroll for AD&D
Insurance will be during the next annual open enrollment period, unless you
have a qualified status change (see the About Your Benefits Program section in
this binder for details).
If you are absent from
work for any reason including illness, disability or leaves of absence, you are
considered to be an inactive employee. If you are an inactive employee on the
date coverage is scheduled to begin your coverage will become effective on the
first day of the month after you return to active work. If you return to work
on the first day of a month, then coverage will begin on that day.
For Your Dependents
AD&D Insurance
coverage for your eligible dependents begins when your coverage begins, provided that you have returned a signed
enrollment form within 31 days of your eligibility date. If you do
not return your enrollment form within 31 days, your next chance to enroll your
dependents for AD&D Insurance will be during the next annual open
enrollment period unless you have a qualified status change.
Cost
If you choose to enroll
yourself and/or your dependents for AD&D Insurance, you pay the full cost
of coverage with after-tax payroll deductions.
Coverage Amount
Your
annual earnings determine the amount of AD&D Insurance coverage you can
purchase for yourself and your dependents.
For Yourself
You have a choice of
five coverage options to select from in the amount of 2, 4, 6, 8 or 10 times
your annual earnings. All coverage amounts are rounded up to the higher $1,000.
Your coverage amount may not exceed $500,000.
For Your Dependents
You may purchase AD&D Insurance for your eligible dependents if you
have purchased this insurance for yourself. The coverage amounts available
depend on the structure of your family, as shown below:
|
Your Family
|
The Coverage Amount
is...
|
|
Spouse and child(ren)
|
n
Spouse—50% of your coverage amount
n
Children*—10% of your coverage amount
|
|
Spouse only
|
Spouse—60% of your coverage amount
|
|
Child(ren) only
|
Children—15% of your coverage amount
|
Domestic partners are
not eligible for coverage under this plan.
If you or a covered dependent die in an accident, the beneficiary will
receive 100% of the coverage amount. If you or a covered dependent is severely
injured in an accident, the AD&D plan will pay a percentage of the full
coverage amount, depending on the nature of the injury, as shown in the
following table:
|
Type of Loss
|
Percentage of
Coverage Amount
|
|
n
Your life
n
Both hands
n
Both feet
n
One hand and one foot
n
Speech and hearing of both ears
n
Sight of both eyes
n
One hand and sight of one eye
n
One foot and sight of one eye
n
Quadriplegia
|
100%
|
|
n
Paraplegia
|
75%
|
|
n
One hand
n
One foot
n
Speech
n
Hearing of both ears
n
Sight of one eye
n
Hemiplegia
|
50%
|
|
n
Thumb and index finger of same hand
n
Hearing of one ear
|
25%
|
Change in
Coverage Amount
Changing Coverage Levels During the Year
You may change your
coverage amount during the annual open enrollment period. However, you may be
able to change your coverage amount during the year if you have a qualified
status change. You must notify Employee Benefits within 31 days of the event.
See the About Your Benefits Program section in this binder for details.
Coverage Amount If Your Earnings Change
Because your AD&D
Insurance coverage amount is based on your earnings, the amount of your
coverage is adjusted when your earnings change. This adjustment to your
coverage occurs on the first day of the month coinciding with or following the
date your earnings change.
If the amount of your
coverage will increase due to an earnings increase, you must be actively at work in order for the increase in coverage to
take effect. If you are not actively at work on that date, your increase in
coverage will take effect on the first day of the month after you return to
active work.
Coverage Amount After Age 70
If you continue to work after you reach age 70, your coverage amount will
be adjusted as follows: