The CNMI government has inked a new contract for the life insurance coverage of NMI Retirement Fund members, selecting Individual Assurance Co. anew as the policy provider for the next 12-month period.
Fund administrator Lillian Pangelinan notified members on Friday of the government’s decision to continue to tap the services of IAC to provide members’ life insurance coverage in 2014.
The government issued a request for proposal for the life insurance program last year prior to the expiration of the IAC contract on Dec. 31.
Pangelinan disclosed that the new life insurance policy will have the following changes beginning Feb. 1, 2014:
For government employees, payment is $.58 per $1,000 of basic life benefits payable biweekly at 1.8 times annual salary. This means an employee earning $25,000 will pay $11.60 for a $45,000 life insurance policy. Premium is calculated as follows: ($25,000 x .58)/1000 = $11.60. The benefit is calculated as follows: $25,000 x 1.8 = $45,000.
For retirees, payment is $.63 per $1,000 of basic life benefits payable semi-monthly at 1.8 times reduced annual pension. As an example, a retiree earning $25,000 will pay $15.75 for a $45,000 life insurance policy. Premium is calculated as follows: ($25,000 x .63)/1000 = $15.75; while benefit is calculated as follows: $25,000 x 1.8 = $45,000
“The rates for government employees and retirees are the same annually; however, the $.05 difference is because there are 26 pay periods for government employees and 24 pension pay periods for retirees,” Pangelinan said in a memorandum.
The new rates for government employees will take effect on the Feb. 21, 2014, pay period and the Feb. 15 pension pay period for retirees.
For members who are currently enrolled in the life insurance program and wish to maintain their coverage, Pangelinan said they do not have to do anything. But if they wish to terminate their coverage, they must complete and turn in a notice of termination available at the NMI Retirement Fund office or on its website at www.nmiretirement.com.