Item 10BCity of South lake, 'texas
MEMORANDUM
August 10, 2005
TO:
FROM
SUBJECT:
Sham Yelverton, City Manager
Kevin Hugman, Director of Human Resources
Approve renewal of contract with Jefferson Pilot for employee Long Term
Disability (LTD) benefits
Action Requested: City Council approval of contract renewal for twelve (12) months with
Jefferson Pilot for employee long term disability, effective October 1, 2005
with guaranteed rates through September 30, 2006.
Background
Information: In May 2002, the City bid out the various employee insurance and benefits
programs. These programs included medical, dental, group life insurance
(including accidental death and dismemberment, life, and long -term disability)
and section 125 plan, Canada Life was chosen as the low bid for long term
disability benefits from twelve (12) bids received. A contract was approved by
City Council in August 2002 for a 24 -month rate guarantee,
In August 2004, City Council approved a 12 -month renewal contract with
Canada Life /Jefferson Pilot with no rate increase over the previous coverage
period. (In 2004, Canada Life was acquired by Jefferson Pilot Financial
Insurance Company.)
Jefferson Pilot has completed its renewal analysis for the City and has offered
a contract renewal for twelve (12) months with no rate increase. The City's
premium is based on employee annual budgeted salary.
Financial
Considerations: The rate renewal offered by Jefferson Pilot is the same rate as the previous
three years: $0.261$100 which results in an approximate monthly cost to the
City of $2,400, or a total approximate annual cost of $28,800.
The proposed LTD insurance benefit costs are within the amounts budgeted in
the proposed FY 2005 -2006 Budget.
Citizen Input/
Board Review: Not Applicable.
Legal Review: Not Applicable.
Alternatives: Denial of contract; City request sealed bids for LTD benefits.
Supporting
Documents: Renewal letter from Jefferson Pilot, dated July 27, 2005
Shana Yelverton, City Manager
August 10, 2005
Page 2
Staff
Recommendation: City Council approve renewal of a 12 -month contract with Jefferson Pilot for
employee long term disability benefits, effective October 1, 2005 with
guaranteed rates through September 30, 2006.
Staff Contact: Kevin Hugman, Director of Human Resources
TP
JEFFERSON PILOT
FINANCIAL
July 27, 2005
City Of Southlake
1400 Main Street, Suite 260
Southlake, TX 76092
RE: Renewal Letter for Policy Number: 86- 0051855 -00000
Jefferson Pilot Financial
Insurance Company
Benefit Partners
8801 Indian Hills Drive
Ornalae, NE 68114 -4066
800 - 423.2765
We have completed our renewal analysis for the above named client. It is our sincere pleasure to provide
City Of Southlake with quality group products and services at a cost that delivers sound value As part of
our effort to ensure continuing quality products and services, each year we carefully review and analyze
current benefit and rate structures to determine the appropriate premium levels to charge for continued
group insurance protection for your valued employees. The renewal process includes a recalculation of
the premium rates to reflect the current plan features, nature of the industry and the composition of your
group, including occupations, salaries, ages and gender of your participating employees.
We have completed our renewal analysis for City Of Southlake's LTD policy, Your current premium rates
appear sufficient to maintain the plan's sound financial basis, therefore, we are not requesting an increase
in your current premium rates,
Your Current
Group Rates
LTD $.260
Your Newly Calculated Rates
Effective on 10/0 1 12005
$,260 per $100 of covered payroll
These rates are guaranteed for 12 months from the renewal date shown above. Your next renewal will
take place 10/01/2006. This renewal letter is intended to serve as a policy amendment and should
be kept with your policy.
Thank you for the opportunity to be of service to City Of Southlake. We appreciate your business and
look forward to working with you in the future as we continue to meet your group insurance needs. If you
have any questions, or if I can be of further assistance, please feel free to call me on our toll -free number:
800- 423 - 2765..
Sincerely,
Florence Wiley
Renewal Service Rep, Level 2
cc: Lifetime Benefits Insurance LLP
400 N Main St #103
Grapevine, TX 76051
cc: Darren D, Hooker, RHU
Jefferson Pilot Financial focuses on making life easier for you by doing business
the way you want to do business - via the Web, telephone, IVR, e -mail and fax
We are committed to being there when you need usl
Visit us on the web at www.'ipfic.com