Item 5J0-ity Vl 0UUtn12l1CC x exas
MEMORANDUM
July 21, 2006
TO: Shana Yelverton, City Manager
FROM: Kevin Hugman, Director of Human Resources
SUBJECT: Approve a contract with Standard Insurance Company to provide employee
basic and voluntary group life and Accidental Death and Dismemberment
(AD &D) insurance benefits
Action Requested: City Council consider approval of a contract with Standard Insurance
Company to provide employee basic and voluntary group life insurance, and
Accidental Death and Dismemberment (AD &D) benefits for Fiscal Year 2006-
2007.
Background
Information: In May 2006, the City bid out its employee insurance benefits. These benefits
include medical, dental, group life insurance (basic, supplemental and
Accidental Death and Dismemberment), long term disability, flexible spending
account (Section 125) administration, and optional vision coverage. Bids were
received on June 26, 2006.
A total of 28 carriers submitted 57 proposals for employee benefit plans. A
summary of the bids received is attached (Attachment A).
Ten carriers submitted proposals for basic and voluntary group life insurance
and AD &D benefits. Staff reviewed the proposals on the following criteria:
• Experience and reputation
• Proposed schedule of benefits
• Rates
• Provider network access / penetration
• Reporting and cost management
Based on this review, staff recommends Standard Insurance Company as
providing the best plan benefits and the lowest rates. Standard Insurance
Company is rated "A" (Excellent) by A.M. Best. Standard has provided a
three -year rate guarantee.
Standard Insurance also provides a "line of duty" benefit for police and fire
personnel, at an additional cost of $0.01 / $1000 coverage. This benefit would
pay an additional $50,000 maximum benefit over the standard benefit. This
additional cost to the City would be an additional $100 per month, but provides
an extraordinary benefit to the families of police and fire personnel. Staff
recommends including this option.
Shana Yelverton, City Manager
July 21, 2006
Page 2
The proposed rate structure, with the "line of duty" benefit, is less than current
rates:
Basic Life:
AD &D:
Financial
Considerations: The proposed basic and voluntary group life and AD &D insurance plan costs
are within budget amounts for the proposed FY 2006 -2007 Budget. The
proposed rates represent a decrease of approximately $4, 139 per year when
compared to current rates.
Citizen Input/
Board Review: Not Applicable.
Legal Review: The City Attorney reviewed the Request for Proposals (RFP) and applicable
documents.
Alternatives: Denial of contract with Standard Insurance Company; seek alternatives.
Supporting
Documents:
• Summary of Bids Received
Staff
Recommendation: City Council approve a contract with Standard Insurance Company for
employee basic and voluntary group life and AD &D insurance benefits,
effective October 1, 2006 with guaranteed rates through September 30, 2009.
Staff Contact: Kevin Hugman, Director of Human Resources
Summary of Bids Received
Insurance Company
Agent
Medical
Dental
Basic I
Supp Life
I AD &D
LTD
Vision
Flex Plan
Aetna
Lifetime Benefits 1 Bob Mundlin
X
X
X
United Health Care
Lifetime Benefits 1 Bob Mundlin
X
X
Blue Cross Blue Shield
Lifetime Benefits / Bob Mundlin
Al Boenker Insurance
X
X
Ameritas Group
Lifetime Benefits/ Bob Mundlin
X
Total Administrative Service Corp.
Lifetime Benefits / Bob Mundlin
X
X
CompBenefits
Lifetime Benefits I Bob Mundlin
X
X
Guardian Life Insurance Co.
Greg Thompson
X
X
Guardian Life Insurance Co_
Lifetime Benefits 1 Bob Mundlin
X
X
Delta Dental
None
X
Sun Life Financial
Lifetime Benefits/ Bob Mundlin
X
X
Safeguard
Lifetime Benefits 1 Bob Mundlin
X
X
MetLife
Lifetime Benefits I Bob Mundlin
X
AIG American General
Lifetime Benefits I Bob Mundlin
X
X
Dental Select
Lifetime Benefits 1 Bob Mundlin
X
Principal Financial Group
Summit Financial I Jim Vollmer
X
Mutual of Omaha
Lifetime Benefits 1 Bob Mundlin
X
Unimerica
None
X
Jefferson Pilot Financial
Lifetime Benefits / Bob Mundlin
X
Standard Insurance Company
Lifetime Benefits 1 Bob Mundlin
X
Prudential Financial
Lifetime Benefits/ Bob Mundlin
X
X
Fort Dearborn Life
Lifetime Benefits 1 Bob Mundlin
X
X
CIGNA
Lifetime Benefits / Bob Mundlin
X
X
Unum Provident
Lifetime Benefits 1 Bob Mundlin
X
X
Life Re
Lifetime Benefits / Bob Mundlin
X
X
Benefit Management Admin (BMA)
Lifetime Benefits / Bob Mundlin
X
AdminOne Corporation
Summit Financial l Jim Vollmer
X
Species
Lifetime Benefits / Bob Mundlin
X
VSP I
Lifetime Benefits 1 Bob Mundlin
X
1
2
2
4
E
7
E
c
1C
11
12
13
14
15
1E
17
1E
1s
2C
21
22
23
24
25
26
27
28
7/25/2006