Special Memo 295

To: Authorized Agents of employers that do not offer NCPERS Term Life Insurance
Re: Voluntary Group Term Life Insurance Program

August 8, 2006

I am writing to remind you of a term life insurance program that has been endorsed by the IMRF Board of Trustees. It is a program which can be offered to your IMRF-covered employees at no cost to your employer. This coverage is in addition to death and surviving spouse benefits provided through IMRF.

Unique Program
IMRF participates in the National Conference on Public Employee Retirement Systems (NCPERS). NCPERS developed this program to be low cost, high value, and easy to administer. It is underwritten by The Prudential Insurance Company of America. Day-to-day administration is provided by The American Administration Group (American). American has an office and a representative in Illinois. It has been my experience that American is easy to work with, accommodates an employer’s special needs, and has been claimant friendly.

IMRF Endorsement
Since IMRF’s 1989 endorsement, 1,506 IMRF employers have offered the program, covering 22,137 actively working members and 6,062 retired members. Claims paid have totaled over $31,610,871.

In 2005, this program was endorsed by the State Employees’ Retirement System for their members.

Plan Highlights

• Participation is completely voluntary.
• There is no minimum number of employees required to participate.
• Medical evidence of insurability is not required during the open enrollment period.
• The member can convert the insurance on a direct pay basis to one of a number of Prudential individual life policies within 31 days following termination of employment.
• Coverage may be continued into retirement at the member’s option.
• Coverage for members’ eligible dependents is automatic at no additional cost.
• The monthly cost is $16 per participating member and is paid through payroll deduction.
• Premiums do not increase over time.
• Premiums are waived if the member becomes totally disabled prior to age 60.
• If the member is terminally ill, up to 50% of the life insurance benefits may be paid to the member before death.
• During active employment, employers make payroll deductions.
• During retirement, premiums are deducted from IMRF retirement benefits.

Conclusion
Enclosed is a schedule of benefits as it appears in the program’s literature. If you would like more information on how the program works or how to set it up for your employees, please contact the Illinois Representative, William (Bill) Shannon at 847-593-6515.

I hope you find IMRF’s review and endorsement of this program beneficial to you as an employer. If you have any questions or comments, please feel free to contact me.