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Annual Open Enrollment

2011 Benefits Open Enrollment

Group Life Insurance
Instructions and Information for
Completing Your Personal Enrollment

These instructions will assist you in completing your Personal Enrollment for The University of Iowa Benefits Program.

Group Life Insurance

MANDATORY PARTICIPATION

Participation in the University’s group term life insurance program is a condition of employment for permanent University faculty and staff members who hold a 50% time or greater appointment.  No statement of health or physical exam is required for this program.

This plan allows you to select from four levels of life insurance coverage.  This coverage is for yourself only.  The University provides you with two times your salary in coverage.  If you select additional coverage, there will be an additional charge.  These choices provide coverage of a flat $50,000, 2 times salary, 2-1/2 times salary, or 3 times salary. Enrollment in the group life plan is mandatory.  You must choose either $50,000 in coverage or two times your salary. 

If you select 50,000 in coverage and your salary is at least $25,000 annually, you will not see a charge on your electronic enrollment, and you will be eligible for a Shared Savings Credit. 

If you select two times your salary in coverage, you will see a charge and an equal credit for the University contribution on your electronic enrollment. 

You still have the option of purchasing 2 1/2 or 3 times your salary in Group Life Insurance if you so desire.  If you choose this option, you will see the full cost of the 2 1/2 or 3 times your salary in Group Life coverage on your electronic enrollment, and you will see the University contribution for 2 times your salary in coverage. Your cost will be the difference between the two.

 

If you choose
The cost on your enrollment will show as
You will receive
Your actual cost will be
$50,000 in coverage
$0.00
$40 Shared Savings Credit (if eligible)
No cost and you receive a $40.00 Shared Savings credit if you're eligible
2x your salary in coverage
Full cost for 2X your salary in coverage
University contribution for 2x your salary in coverage
No cost.
2.5x your salary in coverage
Full cost for 2.5X your salary in coverage
University contribution for 2x your salary in coverage
Cost for .5 times your salary in coverage
3x your salary in coverage
Full cost for 3X your salary in coverage
University contribution for 2x your salary in coverage
Cost for 1 time your salary in coverage

 

 

COST & MAXIMUM COVERAGE LIMITS

Cost is $0.43 per thousand of coverage per month.

The maximum amount of obtainable life insurance is $400,000

TAXABLE LIFE INSURANCE

The Internal Revenue Service (IRS) has determined that if an employer allows employees access to life insurance in excess of $50,000, the amount in excess of $50,000 has a value to the employee. This value must be added to the individual’s taxable salary when reporting income earned on the annual W2. This income is based upon the following IRS table:

Age
Rate per $1,000 of Excess
Life Insurance Per Year
Under 25
$0.60
25 - 29
$0.72
30 - 34
$0.96
35 - 39
$1.08
40 - 44
$1.20
45 - 49
$1.80
50 - 54
$2.76
55 - 59
$5.16
60 - 64
$7.92
65 - 69
$15.24
70 and older
$24.72

Example:
Salary--$50,000
3 times life insurance selected--$150,000
Age--46

Calculation:
150,000 minus 50,000 = 100,000
100,000 divided by 1,000 = 100
100 times X 1.80 = $180.00
$180.00 is added to W2 as taxable income

In determining the amount of life insurance in excess of $50,000, the employer must total all life insurance programs in which the employee participates. For The University of Iowa, this would include the basic group program, the supplemental life insurance program and spouse and dependent life. If you have any questions concerning this calculation and the possible effect on your taxable income, please contact the University Benefits Office.

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Questions? Need Help?

If you have questions or concerns regarding the enrollment process, please contact:

University Benefits
120-40 USB

Email: benefits@uiowa.edu

Web Site: www.uiowa.edu/hr/benefits

Phone: 319-335-2676 or
877-830-4001 (toll free)

Fax: 319-335-2776