Item 5BCity of Southlake, Texas
MEMORANDUM
September 15, 2004
TO: Billy Campbell, City Manager
FROM: Kevin Hugman, Director of Human Resources
SUBJECT: Approve renewal of a contract with Mutual of Omaha for employee and
dependent basic and voluntary life insurance benefits and employee Accidental
Death and Dismemberment insurance benefits.
Action Requested: City Council approval of a contract renewal with Mutual of Omaha for
employee and dependent basic and voluntary life insurance benefits and
AD &D insurance benefits, effective October 1, 2004 with guaranteed rates
through September 30, 2006.
Background
Information:
Financial
Considerations:
Citizen Input/
Board Review:
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. Mutual of Omaha was chosen as the low bid for basic
and voluntary life and accidental death and dismemberment (AD &D)
insurance benefits from twenty -one (21) bids received. A contract was
approved by City Council in August 2002 for a 24 -month rate guarantee.
Mutual of Omaha has completed its renewal analysis for the City and has
offered a contract renewal for twenty -four (24) months at the following rates:
• Life Insurance (Employee Basic)
• AD &D Insurance
• Voluntary Term Life Insurance
$0.13 per $1,000 ( +$0.01)
$0.03 per $1,000 (no chg)
Step rated (no chg)
The City pays the employee basic life insurance benefits at one times annual
salary up to a maximum of $50,000 coverage. Employees who choose
voluntary supplemental insurance benefits on themselves or dependents pay
those premiums. The annual cost to the City at the proposed rates on basic life
premiums is approximately $15,300 annually.
The cost to the City for AD &D benefits is approximately $3,500 annually. The
proposed amounts for group life and AD &D insurance benefits are within the
budgeted amounts in the FY 2004 -2005 Annual Budget.
Not Applicable.
Legal Review: Not Applicable.
Billy Campbell, City Manager
September 15, 2004
Page 2
Alternatives: Input as desired by Council.
Supporting
Documents: None
Staff
Recommendation: City Council approve renewal of a contract with Mutual of Omaha for
employee and dependent group life insurance and employee AD &D insurance
benefits, effective October 1, 2004 with guaranteed rates through September
30, 2006.