Frequently Asked Questions: Life Insurance Plans

In order for you to enroll in the Spouse and/or Child Term Life Insurance plans at hire or initial eligibility, using HRIS Self Service you should first designate beneficiaries for the Basic Term Life Insurance Plan and then enroll in the Supplemental Term Life Insurance plan.

Then you should go to the Spouse plan and click on the "Elect" radial button. You then should enroll your spouse as the covered individual. You do not need to designate a beneficiary for the Spouse plan as you, the employee, are assumed to be the designated beneficiary.

Then you should go to the Dependent Child plan and click on the "Elect" radial button. You then should enroll your eligible dependent children as the covered individual(s). You do not need to designate a beneficiary for the Child plan as you, the employee, are assumed to be the designated beneficiary

After initial eligibility, enrolling in the Supplemental and Spouse plans requires evidence of good health and approval of the sponsoring insurance company.

The maximum coverage is:

Basic Term Life Insurance coverage for individuals under age 55 is 2.5 times your University salary up to $200,000. Beginning at age 55, the coverage factor is reduced by 8% each year. The cost of coverage over $50,000 is considered by the IRS to be taxable income to you. If you originally elect $50,000 and later wish to elect the higher coverage, you must apply for such coverage by providing documentation of good health satisfactory to the sponsoring insurance company.

Supplemental Term Life Insurance coverage is 1-5 times your University salary not to exceed $1,000,000. At hire or initial benefits eligibility, you are guaranteed up to 2 times salary. Any higher amount requires documentation of good health and approval of the sponsoring insurance company. After initial eligibility, enrolling in the plan for the first time or increasing the amount of coverage requires documentation of good health and approval of the sponsoring insurance company.

Spouse Term Life Insurance coverage is limited to $250,000 not to exceed 50% of your Supplemental coverage. After initial eligibility, enrolling in the plan for the first time or increasing the amount of coverage requires documentation of good health and approval of the sponsoring insurance company.

Dependent Child Life Insurance may be elected in increments of $2,000 up to a maximum coverage of $10,000.

Age Factor
55 2.3
56 2.116
57 1.947
58 1.791
59 1.648
60 1.516
61 1.394
62 1.283
63 1.180
64 1.086
65 0.999
66 0.919

Naming one's spouse as beneficiary is a common practice, but it is recommended that you also designate a contingent beneficiary.

Use a Valid Trust - As used by lawyers and financial professionals, "trust" has a specific, legal meaning. If you specify a trust as beneficiary of your life insurance, an actual valid trust must exist, either as a separate document (living trust) or as part of your will (testamentary trust). An insurance company will not honor a beneficiary description such as "Sue Smith as Trustee for my children" if there's no written evidence of that trust. Trusts that have expired or been revoked also won't be honored.

*Defining Trust - A trust is a written document under which money or other assets are transferred from one person (the "grantor") to another person or institution such as a bank (the "trustee"), to be managed and used for the benefit of a third person (the "beneficiary"). Trusts can be designed to accomplish a wide range of financial and estate planning goals.

There are two basic types of trusts: the "living trust" and the "testamentary trust": Living trusts, also known as "inter vivos" trusts, are created during the lifetime of the grantor. Life insurance proceeds which are distributed to a living trust will avoid probate. Testamentary trusts are drafted as part of a will and take effect after the death of the grantor. Proceeds distributed through a testamentary trust pass through the probate process after the grantor's death because the trust is included in the will.

If you live in one of the following community property states - Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington or Wisconsin - your spouse may have a legal claim for a portion of the life insurance benefit under state law. If you name someone other than your spouse as beneficiary, payment of the death benefit may be delayed until your spouse's claim is resolved. If you make the beneficiary someone other than your spouse, it may be a good idea to get a signed statement from your spouse waiving his or her rights to any community property interest in the benefit.

If you sign a power-of-attorney document, you are empowering the individual you designate (known as an "agent" or "attorney-in-fact") to perform certain business and legal transactions on your behalf if you become incapacitated and are no longer able to manage your financial affairs. To ensure that your agent can change the beneficiary on your insurance policy, be sure that the power-of-attorney document refers to the policy and gives your agent the specific authority to change a life insurance beneficiary.

Yes, you may designate your life insurance beneficiaries online using HRIS Self Service. You may access Self Service and designate or change your beneficiaries at any time. You will receive a auto response email message confirming the changes were made.