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HomeMy WebLinkAbout1990-066 1 2 3 4 5 6 7 8 9 10 11 12 13 14 IS II I 16 17 18 19 20 21 n 23 24 25 26 27 28 , RESOLUTION NO. qn hh RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE ADOPTION OF STANDARD INSURANCE COMPANY LONG TERM DISABILITY POLICY NO. 602422 FOR MANAGEMENT/CONFIDENTIAL AND MID MANAGE- MENT EMPLOYEES. BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: WHEREAS the Council adopted Resolution No. 87-155 on May 18, 1987, authorizing the execution of an agreement with Standard Insurance Company relating to implementation of a long term disability program for management and confidential employees, WHEREAS Council later authorized the addition of Mid Management employees to that policy, WHEREAS Standard Insurance Company has prepared a compre- hensive policy document incorporating all relevant parts of the application for insurance adopted by Resolution No. 87-155 plus subsequent amendments to that application as described in the staff report, NOW THEREFORE BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO that the Standard Insurance Company LTD policy no. 602422 is in full force and effect, a copy of which is attached hereto, marked Exhibit "An and incorporated herein by reference as fully as though set forth at length. Page 1 of 2 01/26/90 . 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE ADOPTION OF STANDARD INSURANCE COMPANY LONG TERM DISABILITY POLICY NO. 602422. I HEREBY CERTIFY that the foregoing resolution was duly adopted by the Mayor and Common Council of the City of San Bernardino a ... ~. _._._!'~9E_l_aE____ at meeting thereof, held of the 5th day of March , 1990, by the following vote, to wit: AYES: Counc il Members Estrada, Reilly. Flores. Maudsley, Minor, Miller NAYS: None ABSENT: Council Member Pope-Ludlam_ ~ ~ _ _~_ _ . . _ _ - .- City Clerk The foregoing resolution is hereby approved this ~da of March , 1990. Approved as to form: /7 y, e-Y0~ 1/26/90 Page 2 of 2 01/26/90 EXHIBIT A '. . STANDARD INSURANCE COMPANY P.O. BOX 711 PORTLAND, OREGON 97207 602422 GROUP POLICY NUMBER NAME OF POLlCYOWNER CITY OF SAN BERNARDINO TYPE OF COVERAGE LONG TERM DISABILITY INSURANCE EFFECTIVE DATE May 1, 1987 INITIAL POLICY TERM Two Years POLICY DELIVERED IN May 1, 1987 and the first day of each calendar month thereafter California and governed by the laws of that state. PREMIUM DUE DATES . STANDARD INSURANCE COMPANY agrees to pay the benefits provided by this GROUP POLICY, in accordance with the provisions of this GROUP POLICY. The consideration for this GROUP POLICY is the application of the POLICYOWNER and the payment by the POLICYOWNER of premiums as provided herein. The GROUP POLICY is issued for the Initial Policy Term shown above, ending on the first day after the end of such policy term at 12:01 A.M. Standard Time at the POLICY OWNER'S address. This GROUP POLICY may be renewed for successive renewal periods by the payment of the premium on each renewal date, provided the number of persons insured on each renewal date is neither less than the Minimum Participation Number nor less than the Minimum Participation Percentage (shown in the Policy Data). The length of each renewal period will be determined by STANDARD, but will not be less than 12 months. All provisions on this and the following pages are a part of this GROUP POLICY. The Certificate of Insurance issued for delivery to each insured MEMBER will include Section One of this GROUP POLICY. The terms "you" and "your" used in Section One refer to the insured MEMBER. The definitions of terms in Section One apply whenever the terms are used anywhere in this GROUP POLICY. Defined terms are printed in all capital letters. STANDARD INSURANCE COMPANY By Secretary J ~-If~ r~ President . \3 Group Insurance Policy GP186-LTD . . . 'J 'f GROUP POLICY AMENDMENT NO. Attached to and made a part of GROUP POLICY 602422 issued to City of San Bernardino as POLICYOWNER. It is agreed that the GROUP POLICY is amended as follows: Effective May 1, INSURANCE ENDS, insured under the 1987, Part 4. BECOMING INSURED item (2) will not apply to MEMBERS GROUP POLICY on May 1, 1987. AFTER become AGAIN who 2. 1, 1987, Part 7.A. RISKS NOT COVERED, item 3. will MEMBERS who become insured under the GROUP POLICY on Effective May not apply to May 1, 1987. 3. Effective January 1, 1988, Part 2.A. DEFINITION OF MEMBER is amended to read as follows: A. DEFINITION OF MEMBER You must be a MEMBER. following: You are a MEMBER if you are all of the 1. An active Management, Mid-Management or Confidential employee of the EMPLOYER, other than a temporary or seasonal employee; 2. Regularly scheduled to work at least 30 hours each week; and 3. A citizen or resident of the United States or Canada. C02A1T 4. Effective January I, 1988, the monthly premium rates for LONG TERM DISABILITY INSURANCE will be $19.10 per insured Mid-Management MEMBER and $16.30 per insured Management or Confidential MEMBER beginning January 1, 1988 and continuing until changed as provided in the GROUP POLICY. 5. Effective May 1, 1989, following May 1, 1989, thereafter will occur on date of 1, 1990 GROUP renewal POLICY dates the renewal will be August August 1. the and Page 1 of Amendment 1 Group Policy No. 602422 . . . 'J 't 6. E"ective May I, 1989, SECTION TWO - POLICYOWNER PROVISIONS, Part I.C. CHANGES IN PREMIUM RATES is amended to read as 'ollows: C. CHANGES IN PREMIUM RATES (1) STANDARD may change anyone or more premium rates at any time when a change in any law or governmental regulation a"ects the amount payable by STANDARD under this GROUP POLICY. Any such change in premium rates will re'lect only the change in STANDARD'S obligations under the GROUP POLICY. Premium rates may also be changed at any time upon mutual agreement between the POLICYOWNER and STANDARD. (2) Except as provided in (I), premium rates will not be changed during the Initial Policy Term shown on the cover 0' this GROUP POLICY. A'ter the Initial Policy Term STANDARD may change any one or more 0' the premium rates upon 60 days written notice to the POLICYOWNER. Any such change in premium rates may be made e"ective on any Premium Due Date. Except as provided in (1), no such change will be made more than once in anyone contract year. Contract years are successive twelve month periods computed 'rom the renewal date. POIC9B This amendment is e"ective as 0' the appropriate dates shown above and is presented with the GROUP POLICY 'or acceptance by the POLICYOWNER. STANDARD INSURANCE COMPANY By Secretary President Page 2 0' Amendment 1 Group Policy No. 602422 . . . . POLICY DATA POLI CY NUMBER INITIAL MONTHLY PREMIUM RATE LONG TERM DISABILITY INSURANCE MINIMUM PARTICIPATION NUMBER MINIMUM PARTICIPATION PERCENTAGE 602422 $20,85 per insured MEMBER 10 insured MEMBERS 100Y. of eligible MEMBERS . SECTION Part 1 . Part 2. Part 3. Part 4. Part 5. Part 6. Part 7. Part 8. A. B. . C. D. E. TABLE OF CONTENTS PAGE ONE - COVERAGE PROVISIONS......... . . . . . . . . . . . . . . . . . . GENERAL DEFINITIONS......... . . . . . . . . . . . . . . . . . . . . . . . . BECOMING INSURED.................................... 2 WHEN INSURANCE ENDS................................. 3 BECOMING INSURED AGAIN AFTER INSURANCE ENDS........ . 4 DEFINITION OF DISABILITy............................ 4 LONG TERM DISABILITY INSURING CLAUSE................ 5 EXCLUSIONS AND LIMITATIONS... . . . . . . . . . . . . . . . . . . . . . . . 5 SCHEDULE OF LONG TERM DISABILITY INSURANCE.......... 6 ELIMINATION PERIOD... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 MAXIMUM BENEFIT PERIOD............................... 7 AMOUNT OF LTD BENEFIT............................. ... 8 PREDISABILITY EARNINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 INCOME FROM OTHER SOURCES............................ 9 Part 9. OTHER LONG TERM DISABILITY BENEFITS AND PROVISIONS.. 13 A. REHABILITATION PROVISION (RETURN TO WORK)............ 13 B. SURVIVORS BENEFIT.................................... 14 C. WAIVER OF PREMIUM.................................... 14 D. BENEFITS AFTER INSURANCE ENDS OR IS CHANGED.......... 15 Part 10. CLAIMS PROVISIONS AND PROCEDURES FOR LTD BENEFITS.. 15 . . Part 11. TIME LIMITS ON LEGAL ACTIONS AND CERTAIN DEFENSES.. Part 12. ASSIGNMENT NOT PERMITTED........................... TWO - POLICYOWNER PROVISIONS........................ PREMIUMS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DIVIDENDS.......................................... . CERTIFICATES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RECORDS AND REPORTS.. . . . . . . . . . . , . . . . . . . , . . ' . ' . . . . . . . MISSTATEMENT OF AGE....... . . . . . . . . . . . . . . . . . . . . . . . . . . ENTIRE CONTRACT; CHANGES.......................,.... INCONTESTABLE CLAUSE................................ EFFECT ON WORKER'S COMPENSATION..................... SECTION Part ,. Part 2. Part 3. Part 4. Part 5. Part 6. Part 7. Part 8. . . PAGE 19 19 20 20 22 22 23 23 23 24 24 . . . INDEX OF DEFINED TERMS PAGE ACCIDENTAL BODILY INJURy...... ELIMINATION PERIOD. . . . . . . . . . .. 7 EMPLOyER..................... . EVIDENCE OF INSURABILITy...... GROUP POLICy.................. INCOME FROM OTHER SOURCES..... 9 INSURANCE.................... . LONG TERM DISABILITY INSURANCE LTD BENEFIT................... MAXIMUM BENEFIT PERIOD........ 7 PAGE MEMBER........................ 2 PHYSICIAN. . . . . . . . . . . . . . . . . . . .. 6 PREDISABILITY EARNINGS........ 8 PREEXISTING CONDITION. . . . . . . .. 6 PREGNANCY. . . . . . . . . . . . . . . . . . . . . RETIREMENT PLAN............... 10 SICKNESS..................... . STANDARD..................... . SURVIVORS BENEFIT............. 14 . . . SECTION ONE - COVERAGE PROVISIONS Part 1. GENERAL DEFINITIONS STANDARD means Standard Insurance Company, Portland, Oregon. EMPLOYER means City of San Bernardino and each subsidiary or affiliate approved in writing by STANDARD. GROUP POLICY means STANDARD'S group policy number 602422 issued to the POLICYOWNER. LONG TERM DISABILITY INSURANCE means your disability insurance under the GROUP POLICY. INSURANCE means your LONG TERM DISABILITY INSURANCE under the GROUP POLICY. LTD BENEFIT means the monthly LONG TERM DISABILITY INSURANCE benefit payable to you according to the terms of the GROUP POLICY. SICKNESS means your sickness, illness, or disease. PREGNANCY means conditions. your pregnancy, childbirth, related medical or ACCIDENTAL BODILY INJURY means an injury to your body caused by an accident. Providing EVIDENCE OF INSURABILITY , if required, means you must: 1 . Complete and sign a health and medical history form provided by STANDARD; 2. Sign STANDARD'S form authorizing STANDARD to obtain information about your health; and 3. Provide any additional information about your insurability reasonably required by STANDARD. All required information must be provided to STANDARD at your expense. C0101M Printed (6/05/89) - 1 - 602422 LTD POLICY . Part 2. BECOMING INSURED To become insured you must meet both of the following requirements plus the ACTIVE ~ORK requirement: 1. You must be a MEMBER. 2. You must be eligible for INSURANCE. C0201D A. DEFINITION OF MEMBER You must be a MEMBER. You are a MEMBER if you are all of the following: 1. An active management or confidential employee of the EMPLOYER, other than a temporary or seasonal employee; 2. Regularly scheduled to work at least 30 hours each week; and 3. A citizen or resident of the United States or Canada. C02A1T . B. ELIGIBILITY FOR INSURANCE You must be eligible for INSURANCE. You are eligible for INSURANCE on the effective date of the GROUP POLICY if you are a MEMBER on that date. Otherwise, you will become eligible for INSURANCE on the first day of the calendar month coinciding with or next following the date you become a MEMBER. C02B1N C. EFFECTIVE DATE OF INSURANCE Your INSURANCE will become effective on the date you become eligible if you meet the ACTIVE ~ORK requirement on that date. D. ACTIVE ~ORK REQUIREMENT If you were DISABLED on the day before the scheduled effective date of your INSURANCE, then the effective date of your INSURANCE will be delayed until the first day after you complete one full day of ACTIVE ~ORK. Printed (6/05/89) - 2 - 602422 LTD POLICY . . . . For purposes of this ACTIVE UORK requirement, you are DISABLED if you are unable, as a result of SICKNESS, ACCIDENTAL BODILY INJURY, or PREGNANCY, to perform the material duties of your own occupation. ACTIVE UORK and ACTIVELY AT UORK mean performing the usual duties of your job at your EMPLOYER'S usual place of business. This ACTIVE UORK requirement also applies to any increase in your INSURANCE. C02C6I Part 3. UHEN INSURANCE ENDS Your INSURANCE will end automatically on the earliest of the following dates: a. The date you cease to be a MEMBER as defined in Part 2.A. b. The date you become a full time member of the armed forces of any country. c. The date the GROUP POLICY terminates. d. The date you cease to be ACTIVELY AT UORK for your EMPLOYER on your regular work days because of (a) a temporary layoff or (b) a general work stoppage (including a strike or lockout) resulting from a labor dispute. e. The date you cease to be ACTIVELY AT UORK for your EMPLOYER on your regular work days for any other reason. However, your INSURANCE may be continued (unless it ends under items a. through d. above) during the following periods while you are absent from ACTIVE UORK: (1) Uhile you are receiving full salary (including sick pay) from your EMPLOYER; (2) During the ELIMINATION PERIOD and while LTD BENEFITS are payable; and (3) During a leave of absence approved by your EMPLOYER and scheduled to last for 30 days or less. C0302C Printed (6/05/89) - 3 - 602422 L TD POll CY . . . Part 4. BECOMING INSURED AGAIN AFTER INSURANCE ENDS You may become insured again under the GROUP POLICY after your INSURANCE ends. The general rule is that you may become insured again on the same basis as a new MEMBER, as provided in Part 2. BECOMING INSURED. However, if your INSURANCE ends because you cease to be a MEMBER, you will be immediately eligible for INSURANCE if you become a MEMBER again within 90 days after your INSURANCE ends. Your Part Your Part INSURANCE will become effective 2, and will not be retroactive INSURANCE will be subject to the 7, as follows: again on the date determined from to the date your INSURANCE ended. PREEXISTING CONDITION exclusion in (1) If you become insured again more than 90 days after your INSURANCE ends, the PREEXISTING CONDITION exclusion will apply to any condition which is a PREEXISTING CONDITION on the date you become insured again. (2) If you become insured again within 90 days after your INSURANCE ends, the PREEXISTING CONDITION exclusion will apply to any condition which was a PREEXISTING CONDITION at the start of the prior period of INSURANCE. For this purpose only, the two periods of INSURANCE will be treated as one period of continuous INSURANCE and the period when you were not insured will be ignored. (The same principles will apply if your INSURANCE ends two or more times and each time you become insured again within 90 days. The three or more periods of INSURANCE will be added together for purposes of the PREEXISTING CONDITION exclusion). Note: After your LTD BENEFITS for a period of DISABILITY end, your INSURANCE will continue without any interruption if you are a MEMBER and immediately return to ACTIVE YORK for your EMPLOYER. This Part 4 will not apply since your INSURANCE continues while you are receiving LTD BENEFITS. C0402Y Part 5. DEFINITION OF DISABILITY You are only required to be DISABLED from your own occupation. You are DISABLED from your own occupation if, as a result of SICKNESS, ACCIDENTAL BODILY INJURY or PREGNANCY, you are unable to perform with reasonable continuity the material duties of your own occupation. Printed (6/05/89) - 4 - 602422 L TD POll CY . . . C0509X Part 6. LONG TERM DISABILITY INSURING CLAUSE Subject to all the terms of the GROUP POLICY, STANDARD will pay the LTD BENEFIT described in Part 8 upon receipt of satisfactory written proof that you have become DISABLED while insured under the GROUP POLICY. C0601F Part 7. EXCLUSIONS AND LIMITATIONS TO LONG TERM DISABILITY INSURANCE A. RISKS NOT COVERED 1. WAR: You are not covered for a disability caused or contributed to by war or any act of war. lJAR means declared or undeclared war, whether civil or internat ional, and any substantial armed conflict between organized forces of a military nature. 2. INTENTIONALLY SELF-INFLICTED INJURY: disability caused or contributed self-inflicted injury. You are not covered for a to by an intentionally 3. PREEXISTING CONDITION: You are not covered for a disability caused or contributed to by a PREEXISTING CONDITION or medical or surgical treatment of a PREEXISTING CONDITION unless you meet both of the following requirements on the date you become DISABLED: a. You have been continuously insured under the GROUP POLICY for at least 12 months; and b. You have been ACTIVELY AT lJORK for at least one full day after those 12 months of continuous INSURANCE. Printed (6/05/89) - 5 - 602422 L TD POLICY . . . PREEXISTING CONDITION means a mental or physical condition for which you have done any of the following at any time during the 90 day period just before the effective date of your INSURANCE under the GROUP POLICY: a. Consulted a PHYSICIAN. b. Received medical treatment or services. c. Taken prescribed drugs or medications. C07A7Q B. LIMITATIONS 1. ELIMINATION PERIOD: No LTD BENEFITS are payable for the ELIMINATION PERIOD. 2. MAXIMUM BENEFIT PERIOD: No LTD BENEFITS are payable after the end of the MAXIMUM BENEFIT PERIOD. 3. REGULAR CARE OF A PHYSICIAN: No any period of DISABILITY when you care of a PHYSICIAN. LTD BENEFITS will be paid for are not under the regular PHYSICIAN yourself. license. means a licensed medical professional other than diagnosing and treating you within the scope of the C07B2Y Part 8. SCHEDULE OF LONG TERM DISABILITY INSURANCE This Schedule of LONG TERM DISABILITY INSURANCE has five sections: A. ELIMINATION PERIOD B. MAXIMUM BENEFIT PERIOD C. AMOUNT OF LTD BENEFIT D. PREDISABILITY EARNINGS E. INCOME FROM OTHER SOURCES You must read each section to understand when LTD BENEFITS are payable and how LTD BENEFITS are calculated. C0803P Printed (6/05/89) - 6 - 602422 LTD POLICY . A. ELIMINATION PERIOD ELIMINATION PERIOD means the length of time you must be continuously DISABLED before LTD BENEFITS become payable. Your ELIMINATION PERIOD is the first 30 days of each period of continuous DISABILITY. Your ELIMINATION PERIOD begins on the date you become DISABLED. LTD BENEFITS are never payable for the ELIMINATION PERIOD. You must be seen regularly and treated by a PHYSICIAN during the ELIMINATION PERIOD. TEMPORARY RECOVERY DURING THE ELIMINATION PERIOD: Temporary recovery from your DISABILITY during the ELIMINATION PERIOD will have the following effect: For purposes of serving the ELIMINATION PERIOD, all separate periods of DISABILITY from the same cause or causes will be added together and treated as one period of continuous DISABILITY. However, you must serve the full 30 day ELIMINATION PERIOD within a period of 35 consecutive days. C08A1M . B. MAXIMUM BENEFIT PERIOD MAXIMUM BENEFIT PERIOD means the longest period of time for which LTD BENEFITS are payable for anyone period of continuous DISABILITY, whether from one or more causes. Your MAXIMUM BENEFIT PERIOD is 1 year. Your MAXIMUM BENEFIT PERIOD begins at the end of the ELIMINATION PERIOD. During the MAXIMUM BENEFIT PERIOD, LTD BENEFITS are paid at the end of each monthly period for which you qualify for LTD BENEFITS. LTD BENEFITS will stop at your death or at any time during the MAXIMUM BENEFIT PERIOD when you no longer qualify for LTD BENEFITS. LTD BENEFITS will stop at the end of the MAXIMUM BENEFIT PERIOD even if you are still DISABLED. TEMPORARY RECOVERY DURING THE MAXIMUM BENEFIT PERIOD: After LTD DISABILITY continuing periods of BENEFITS become payable, temporary recovery from your will have the following effect: For purposes of LTD BENEFITS during the MAXIMUM BENEFIT PERIOD, any two DISABILITY from the same cause or causes will be added Printed (6/05/89) - 7 - 602422 LTD POLICY . . . . . together and treated as one period of continuous DISABILITY if they are separated by a period of recovery of less than 180 days. Thus, a new ELIMINATION PERIOD will not be required, the PREDISABILITY EARNINGS used to compute your LTD BENEFIT will not change, and the MAXIMUM BENEFIT PERIOD will be the balance of the MAXIMUM BENEFIT PERIOD remaining unused before the period of recovery. No LTD BENEFITS will be payable under this provision after benefits become payable to you under any other group long term disability insurance policy. This rule prevents double coverage if you become insured under another policy while you are working during a period of temporary recovery. C08B9A C. AMOUNT OF LTD BENEFIT Your LTD BENEFIT equals your MAXIMUM LTD BENEFIT reduced by your INCOME FROM OTHER SOURCES. Your MAXIMUM LTD BENEFIT equals A or B, whichever is less, where: A = 60Y. of your PREDISABILITY EARNINGS. B = $5,000. Your LTD BENEFIT during a period of DISABILITY will be determined by your MAXIMUM LTD BENEFIT in effect on your last day of ACTIVE WORK before you become DISABLED. The minimum LTD BENEFIT is $50. PREDISABILITY EARNINGS are defined in Part 8.0. INCOME FROM OTHER SOURCES are defined in Part 8.E. C08C4E D. PREDISABILITY EARNINGS PREDISABILITY EARNINGS means your monthly rate of earnings from your EMPLOYER including commissions and deferred compensation, but excluding bonuses, overtime pay and any other extra compensation. The following rules apply to the computation of your monthly rate of earnings: Printed (6/05/89) - 8 - 602422 L TO POll CY . . . Commissions: Your monthly rate of earnings on any date includes the average monthly commission paid to you by your EMPLOYER during the preceding 12 calendar months (or during your period of employment if less than 12 months). Weekly Pay: Weekly earnings are multiplied by 4.333 to find your monthly rate of earnings. Hourly Pay: Your hourly pay rate is multiplied by the number of hours you are regularly scheduled to work per month (but not more than 173) to find your monthly rate of earnings. If you do not have regular work hours, your monthly rate of earnings on any date will be based on the average number of hours you worked during the preceding 12 calendar months (or during your period of employment if less than 12 months), but not more than 173. EFFECTIVE DATE OF CHANGES IN PREDISABILITY EARNINGS: If you become DISABLED, the PREDISABILITY EARNINGS used to compute your LTD BENEFIT will be based on your monthly rate of earnings in effect on your last full day of ACTIVE WORK before you become DISABLED. Any change in the amount of your monthly rate of earnings which is approved or becomes effective after that last full day of ACTIVE WORK will have no effect on the amount of the PREDISABILITY EARNINGS used to compute your LTD BENEFIT for that period of DISABILITY. NOTE: Two or more separate periods of DISABILITY resulting from the same cause or causes may qualify for treatment as one continuous period of DISABILITY. If 50, the PREDISABILITY EARNINGS used to compute your LTD BENEFIT for each separate period of DISABILITY will be the same amounts as for the initial period of DISABILITY. C08D3W E. INCOME FROM OTHER SOURCES INCOME FROM OTHER SOURCES is explained in the following definition, exceptions, and rules. 1. DEFINITION OF INCOME FROM OTHER SOURCES INCOME FROM OTHER SOURCES means: a. Any sick payor other salary continuation (other than vacation pay) paid to you by your EMPLOYER which, when added to the amount of your MAXIMUM LTD BENEFIT, exceeds Printed (6/05/89) 602422 LTD POLICY - 9 - . e. . g. 100'- of your PREDISABILITY EARNINGS. b. One-half BENEFITS EMPLOYER, the amount of your earnings from work while LTD are payable, including earnings from your any other employer, or self-employment. c. Any amount you receive result of your temporary partial, under a Worker's or are eligible to receive as a disabi 1 ity, whether total or Compensation Act or similar law. d. Any amount you, your spouse or your children receive or are eligible to receive because of your disability or retirement under the Federal Social Security Act, the Canada Pension Plan, the Quebec Pension Plan, or any similar plan or act. Early retirement benefits payable prior to normal retirement age under the plan or act will not be considered INCOME FROM OTHER SOURCES unless they are actually received. The amount you receive of your disability compensation disability income benefit law. or are eligible to receive because under any state unemployment benefit law or state disability f' The amount you receive or of your disability under other than group credit disability insurance. are eligible to receive because any group insurance coverage, insurance or group mortgage Any disability or retirement benefits paid to you RETIREMENT PLAN to which your EMPLOYER contribution, except: under a made a (1) Any lump sum distribution of your entire interest in the plan. (2) Any amount which is contributions to the plan. attributable to your (3) Any amount termination retired. which you could of employment without have received upon being disabled or RETIREMENT PLAN means a defined benefit plan or a defined contribution plan providing disability or retirement benefits for employees. It does not include: Printed (6/05/89) . - 10 - 602422 L TD POll CY . . . (1) A profit sharing plan. (2) A thrift or savings plan. (3) A deferred compensation plan. (4) A 401lk) plan. (5) An Individual Retirement Account (IRA). (6) A Tax Sheltered Annuity (TSA). (7) A stock ownership plan. (8) A Keogh (HR-l0) Plan with respect to partners. (9) A retirement plan under a Professional Service Corporation with respect to Principals. h. Any benefits you compensation law. under unemployment receive any i . Any amount received by compromise, method as a result of a claim for above. settlement or other any of a. through h. C08EGF 2. EXCEPTIONS TO INCOME FROM OTHER SOURCES The following will not be considered INCOME FROM OTHER SOURCES: a. Any cost of living increase in any INCOME FROM OTHER SOURCES, provided that the increase becomes effective wh ile you are DISABLED and while you are eligible to receive the INCOME FROM OTHER SOURCES. (This exception does not apply to any increase in your earnings from any work. ) b. Any amount received as reimbursement medical, or surgical expense. for hospital, c. Any amount which represents reasonable attorneys incurred in connection with the claim for INCOME OTHER SOURCES. fees FROM Printed (6/05/89) - 11 - 602422 L TO POll CY . . . d, Any benefits received by, or over. under the Federal Social Security Act or on behalf of, your dependent child age 18 e, Benefits from any individual disability insurance policy, f, Any amount you receive result of your permanent partial, under a Yorker's or are eligible to receive as a disability, whether total or Compensation Act or similar law, C08E4Y 3, RULES FOR INCOME FROM OTHER SOURCES Each month your LTD BENEFIT will be determined using the INCOME FROM OTHER SOURCES for the same monthly period, even if you actually receive the INCOME FROM OTHER SOURCES in another month. If you receive any INCOME FROM OTHER SOURCES periodically other than monthly, STANDARD will determine the monthly equivalent and use that amount in determining your LTD BENEFIT. If you receive any INCOME FROM OTHER SOURCES in a lump sum, STANDARD will prorate the lump sum over the period of time for which the lump sum was paid and use that amount to determine your LTD BENEFIT, If no period of time is stated, STANDARD will determine the maximum period of time to which the lump sum is fairly attributable and prorate the lump sum over that period of time. With respect to have not yet options: INCOME FROM OTHER SOURCES which you are claiming but received, STANDARD will offer you the following Option ,. STANDARD will determine your LTD BENEFIT each month using the monthly amount of the INCOME FROM OTHER SOURCES you expect to receive for that period, You will be reimbursed by STANDARD if this results in an underpayment of your claim for LTD BENEFITS, You must repay STANDARD if this results in an overpayment of your claim for LTD BENEFITS, Printed (6/05/89) - 12 - 602422 LTD POLICY . . . Option 2. STANDARD will pay you LTD BENEFITS without any adjustment on account of that INCOME FROM OTHER SOURCES until your claim for that INCOME FROM OTHER SOURCES is approved. You must repay STANDARD for any resulting overpayment of your claim for LTD BENEFITS. Option 2. becomes effective automatically iF you fail to make a choice. You must notify STANDARD of the amount of the INCOME FROM OTHER SOURCES when it is approved. If it is approved for a period when STANDARD has already paid an LTD BENEFIT, STANDARD will recompute the amount of the LTD BENEFIT which was payable to you For that period. If you have been underpaid, STANDARD will pay you the amount of any such underpayment with interest at a rate determined by STANDARD. If you have been overpaid, STANDARD will notify you of the amount of the overpayment. You must immediately reimburse STANDARD for the amount of the overpayment. You will not receive any payments from STANDARD until STANDARD has been reimbursed in full. In the meantime, any LTD BENEFITS becoming payable will be applied to reduce the amount of the overpayment of your claim for LTD BENEFITS. C08E5Y Part 9. OTHER LONG TERM DISABILITY BENEFITS AND PROVISIONS A. REHABILITATION PROVISION (RETURN TO WORK) If you work while LTD BENEFITS are payable, your earnings from that work will be used in determining the amount of your LTD BENEFIT. NOTE: Allor a part of the ELIMINATION PERIOD can be satisfied while you are working iF you are considered DISABLED during your period of work activity. C09A1F Printed (6/05/89) - 13 - 602422 LTD POLICY . . . B. SURVIVORS BENEFIT If you die while LTD BENEFITS .re payable to you, STANDARD will pay a monthly benefit, c.lled the SURVIVORS BENEFIT ,for a maximum of 3 months .fter your death. The following rules shall apply: 1. A SURVIVORS BENEFIT will be paid only if you are survived by a spouse or an unmarried child under age 21. 2. The SURVIVORS BENEFIT will equ.l the amount of your MAXIMUM LTD BENEFIT. 3. Any SURVIVORS BENEFIT payable will first be .pplied to reduce the amount of .ny outstanding overpayment of your claim for LTD BENEFITS. 4. The SURVIVORS BENEFIT will be paid to anyone or more of the following at the option of STANDARD: a. Your spouse; b. One or more of your unmarried children under age 21; or c. Any person providing the care and support of any of them. 5. SURVIVORS BENEFITS are paid until the earlier of: a. Three months after your death; or b. The death of your last surviving spouse or unmarried child under age 21. C09B1K C. WAIVER OF PREMIUM Your LONG TERM DISABILITY DISABLED will be continued BENEFITS are payable. INSURANCE in effect when you become without payment of premiums while LTD If a period of continuous DISABILITY is extended by a new cause while LTD BENEFITS are payable, LTD BENEFITS will continue while you remain DISABLED, subject to the terms of the GROUP POLICY and the following rules: (al LTD BENEFITS will not continue beyond the end of the original MAXIMUM BENEFIT PERIOD. Printed (6/05/89l 602422 LTD POLICY - 14 - . . . (b) No LTD BENEFITS will be paid for any extension of a of continuous DISABILITY caused or contributed to risk excluded under Part 7. period by a C09C1B D. BENEFITS AFTER INSURANCE ENDS OR IS CHANGED Your right to receive LTD DISABILITY which begins while will not be affected by: BENEFITS for a period of continuous you are insured under the GROUP POLICY (a) The termination of the GROUP POLICY after the date you become DISABLED; (b) The termination of your INSURANCE while the GROUP POLICY remains in force; or (c) Any amendment to the GROUP POLICY approved after the date you become DISABLED. C09D1B Part 10. CLAIMS PROVISIONS AND PROCEDURES FOR LTD BENEFITS A. PAYMENT OF BENEFITS All LTD BENEFITS will be paid to you. Any LTD BENEFIT unpaid at the time of your death will be paid to the persons receiving the SURVIVORS BENEFIT. If no SURVIVORS paid, the unpaid LTD BENEFIT will be paid to your estate. remaining person or BENEF IT is B. TIME LIMITS FOR FILING A CLAIM You must claim LTD BENEFITS within 120 days after the end of the ELIMINATION PERIOD or as soon thereafter as reasonably possible and, in any case, within one year after the end of that 120 day period. Claims not filed within these time limits will be denied and no LTD BENEFIT will be paid. These limits will not apply during any period when you lacked the legal capacity to file a claim. C. FILING A CLAIM All claims for LTD BENEFITS should be submitted on STANDARD'S forms. You should obtain claim forms from the POLICYOWNER or the Plan Administrator. Printed (6/05/89) - 15 - 602422 L TD POll CY I- - - You may also request claim forms from STANDARD. If STANDARD fails to provide you with claim forms within 15 days of your request, you may submit your claim in a letter stating the occurrence, character, and extent of the event for which the claim is made. D. PROOF OF LOSS Proof of each of the following elements of proof of loss must be provided to STANDARD at your expense. No LTD BENEFITS will be paid until STANDARD receives satisfactory written proof: 1. That you became DISABLED while insured under the GROUP POLICY. 2. That you were DISABLED throughout the ELIMINATION PERIOD and the period for which LTD BENEFITS are claimed. 3. That your DISABILITY results from a cause not excluded in Part 7. 4. That you are being seen regularly and treated by a PHYSICIAN. 5. Of such additional information as STANDARD may reasonably require in connection with your claim for LTD BENEFITS. If your claim is approved, no LTD BENEFITS will be continued beyond the end of the period for which you have provided STANDARD with satisfactory written proof of loss. E. DOCUMENTATION OF CLAIM You must submit the following documents at your expense: 1. A completed claim statement signed by you. 2. A completed claim statement signed by the POL I CYOI.JNER . 3. A completed claim statement signed by your treating PHYSICIAN. 4. Your written authorization for STANDARD to obtain the records and information needed to determine your eligibility for LTD BENEFITS. 5. Such other documents as STANDARD may reasonably require. STANDARD will require you claim at your expense receiving LTD BENEFITS. to submit additional documentation of your at reasonable intervals while you are Printed (6/05/89) - 16 - 602422 L TD POll CY . I . . F. DOCUMENTATION OF INCOME FROM OTHER SOURCES Documentation of INCOME FROM OTHER SOURCES must be provided to STANDARD at your expense. If STANDARD reasonably believes that you are receiving or are eligible to receive INCOME FROM OTHER SOURCES. STANDARD has the right to require satisfactory written documentation: (al That you have made timely claim for the INCOME FROM OTHER SOURCES; (bl That you have properly pursued each claim; and (cl Of the amount of the INCOME FROM OTHER SOURCES. STANDARD will send you a written request for any required documentation. You must provide such documentation within 60 days after the written request is mailed to you. Otherwise, STANDARD. at its sole discretion, may elect to reduce your LTD BENEFITS by the amount STANDARD reasonably believes you are receiving or would have been eligible to receive upon timely and proper pursuit of a claim for the INCOME FROM OTHER SOURCES. If your claim for LTD BENEFITS has been overpaid. STANDARD will notify you of the amount of the overpayment. You must immediately reimburse STANDARD for the amount of the overpayment. You will not receive any payments from STANDARD until STANDARD has been reimbursed in full. In the meantime. any LTD BENEFITS becoming payable will be applied to reduce the amount of the overpayment of your claim for LTD BENEFITS. If you later provide the required documentation within a reasonable time, STANDARD will recompute the amount of LTD BENEFITS which were payable. If you have been overpaid, STANDARD will notify you of the amount of the overpayment and the overpayment will be handled as above. If you have been underpaid. STANDARD will pay you the amount of the underpayment with interest at a rate determined by STANDARD. G. INVESTIGATION OF YOUR CLAIM STANDARD has the your claim. No LTD reasonable time to right at any time to conduct BENEFITS will be paid until conduct an investigation. an investigation of STANDARD has had a Printed (6/05/891 - 17 - 602422 LTD POLICY . . . H. INDEPENDENT EXAMINATION. STANDARD has the right reasonable intervals examinations will be vocational specialists to have you examined at STANDARD'S expense at while you are claiming LTD BENEFITS. Any such conducted by one or more PHYSICIANS or of STANDARD'S choice. STANDARD has the right to defer or suspend payment of LTD BENEFITS if you fail to attend an examination or fail to cooperate with the person conducting the examination. In such a case LTD BENEFITS may be resumed, provided that the required examination occurs within a reasonable time and LTD BENEFITS are otherwise payable. I. NOTICE OF DECISION ON CLAIM You will receive a written decision on your claim within a reasonable period of time after STANDARD receives your claim. If STANDARD denies all or any part of your claim, you will receive a written notice of denial containing: (1) The reasons for the denial; (2) Reference to the provisions of the GROUP POLICY on which the denial is based; (3) A description of any additional information or documentation you must submit to obtain benefits and an explanation of why such information or documentation is required; (4) Notice of your right to a review of the denial; and (5) A description of the review procedure. If you do not receive a written decision on your claim within 90 days after your claim is received, you will have an immediate right to request a review under the review procedure, as if your claim had been denied. J. REVIEW PROCEDURE You have a right to a review of any denial by STANDARD of all or any part of your claim. To obtain a review, you should send a written request for review to STANDARD within 60 days after you receive notice of the denial. No special form is required. As a part of your request for review, you may submit issues and comments in writing and provide additional documentation in support of your claim. You may review pertinent documents related to your request for review. Printed (6/05/89) - 18 - 602422 LTD POLICY . STANDARD will review your claim promptly a'ter receiving your request 'or review. You will receive written notice 0' STANDARD'S decision within 60 days a'ter your request 'or review is received, or within 120 days i' special circumstances require an extension. The written decision you receive will include the reasons 'or the decision and re'erence to the provisions 0' the GROUP POLICY on which the decision is based. You may authorize another person to act 'or you under this review procedure. Cl001C Part 11. TIME LIMITS ON LEGAL ACTIONS AND CERTAIN DEFENSES No action at POll CY unt i 1 STANDARD. law or in equity may be brought to recover under the GROUP 60 days a'ter written proo' 0' loss has been provided to Any statement you not a warranty. deny your claim or make to obtain INSURANCE will be a representation and No misrepresentation by you will be used to reduce or to deny the validity 0' your INSURANCE unless: (a) Your INSURANCE would not have been approved except 'or your . misrepresentation; Cb) Your misrepresentation is contained in a written instrument signed by you; and (c) You have been given a copy 0' the written instrument containing your misrepresentation. A'ter your INSURANCE has been in e"ect 'or two years, no misrepresentation by you, except a 'raudulent misrepresentation made with actual intent to deceive, will be used to reduce or deny your claim or to deny the validity 0' your INSURANCE. Cl1 01 F Part 12. ASSIGNMENT NOT PERMITTED Your Certi'icate is not assignable. The INSURANCE provided and bene'its payable are not assignable. C1201A Printed (6/05/89) - 19 - 602422 L TD POll CY . . . . SECTION T~O - POLICYO~NER PROVISIONS P~rt 1. PREMIUMS A. PREMIUM CHARGES The premium charge on each premium due date will be an aggregate amount based on the sum of the premiums due for all MEMBERS then insured under the GROUP POLICY. P01A1D B. CONTRIBUTIONS FROM MEMBERS The POLICYO~NER pay. the entire cost of INSURANCE. P01B1E C. CHANGES IN PREMIUM RATES (1) STANDARD may change anyone or more premium rates ~t any time when a change in any law or government~l regulation affects the amount payable by STANDARD under this GROUP POLICY. Any such change in premium rate. will reflect only the change in STANDARD'S obli9~tions under the GROUP POLICY. Premium rates may also be changed at any time upon mutual agreement between the POLICYO~NER and STANDARD. (2) Except as provided in (1), premium rates will not be changed during the Initial Policy Term shown on the cover of this GROUP POLICY. After the Initial Policy Term STANDARD may change any one or more of the premium r~tes upon 31 days written notice to the POLICYO~NER. Any such ch~nge in premium rates may be made effective on any Premium Due Date. Except as provided in (1), no such change will be made more than once in anyone contract year. Contract years are successive twelve month periods computed from the end of the Initial Policy Term. P01C1A D. PAYMENT OF PREMIUMS All premiums are due on the Premium Due Dates shown on the cover of the GROUP POLICY. Printed (6/05/89) - 20 - 602422 LTD POLICY J . . . Each premium due is payable by the POLICYOWNER on or before its due date direct to STANDARD at its Home Office. The payment of each premium as it becomes due will maintain this GROUP POLICY in force through the date immediately preceding the next Premium Due Date. P01D1A E. TERMINATION OF GROUP POLICY BY THE POLICYOWNER The POLICYOWNER may terminate the GROUP POLICY at any time by giving prior written notice to STANDARD. The effective date of the termination will be the later of (a) the date specified in the notice, and (bl the date the notice is received by STANDARD. No coverage under the GROUP POLICY will continue and no premium charges will accrue after the effective date of the termination of the GROUP POLICY. P01E1A F. TERMINATION OF GROUP POLICY BY STANDARD STANDARD may terminate the GROUP POLICY as follows: (a) On any renewal date if the number of persons insured is less than the Minimum Participation Number or less than the Minimum Participation Percentage. (b) On any Premium Due Date if STANDARD, in its sole judgment, determines that the POLICYOWNER (a) has failed to promptly furnish any necessary information requested by STANDARD, or (b) has failed to perform any other obligations relating to this GROUP POLICY. STANDARD will give 31 days prior written notice of any such termination of the GROUP POLICY. P01F1C G. GRACE PERIOD The GROUP POLICY has a 31 day Grace Period for each premium due after the first premium. If a premium is not paid on or before the Premium Due Date, the premium may be paid during the following 31 day Grace Period. The GROUP POLICY will remain in force during the Printed (6/05/89) - 21 - 602422 LTD POLICY . . . . . Grace Period, and the POLICYOWNER is liable to STANDARD for the payment of the premium for that period. P01G1C H. TERMINATION OF GROUP POLICY FOR NONPAYMENT OF PREMIUMS If the required premium is not paid during the Grace Period, the GROUP POLICY will terminate automatically at 12:01 AM on the date following the end of the Grace Period. The POLICYOWNER is liable for the payment of the premiums for the coverage continued during the Grace Period. P01H1B I. PREMIUM ADJUSTMENTS Premium adjustments involving POLICYOWNER will be limited to preceding the date STANDARD adjustment and evidence that an a return of unearned premiums to the the twelve month period immediately receives a request for premium adjustment should be made. PO 1 lIB Part 2. DIVIDENDS During the period this GROUP POLICY is in force, it will be credited with its share, if any, of the divisible surplus in the form of dividends as declared by STANDARD. P0201A Part 3. CERTIFICATES STANDARD will issue Certificates to the POLICYOWNER showing the insured MEMBER'S coverage under this GROUP POLICY. The POLICYOWNER will distribute a Certificate to each insured MEMBER. P0301A Printed (6/05/89) - 22 - 602422 LTD POLICY r. ! . . . . . . . Part 4. RECORDS AND REPORTS The POLICYOWNER will furnish on STANDARD'S forms all information reasonably necessary to the administration of the GROUP POLICY when required by STANDARD. STANDARD has the right at all reasonable times to inspect the payrolls and other records of the POLICYOWNER which relate to INSURANCE under this GROUP POLICY. Clerical error by the POLICYOWNER will not: (al Cause a MEMBER to become insured; (bl Invalidate INSURANCE otherwise validly in force; or (cl Continue INSURANCE otherwise validly terminated. P0401A Part 5. MISSTATEMENT OF AGE If the age of a MEMBER has equitable adjustment of the adjustment will be based on: been misstated, STANDARD premiums or of benefits or an The will make of both. (a) The amount of the MEMBER'S INSURANCE based on the MEMBER'S correct age; and (b) The difference between the premiums paid and the premiums which would have been paid if the MEMBER'S age had been correctly stated. P0501A Part G. ENTIRE CONTRACT; CHANGES The GROUP POLICY and the application of the POLICYOWNER, constitute the entire contract between the parties. if any, This GROUP POLICY GROUP POLICY will executive officer attachment to the GROUP POLICY or to may be changed in whole or in part. No change in the be valid unless it is approved in writing by an of STANDARD and delivered to the POLICYOWNER for GROUP POLICY. No agent has authority to change this waive any of its provisions. POG01B Printed (6/05/89) - 23 - 602422 LTD POLICY . . . ~. ,. I Part 7. INCONTESTABLE CLAUSE Any statement made by the POLICYOWNER to obtain the GROUP POLICY is a representation and not a warranty. No misrepresentation by the POLICYOWNER will be used to deny the validity of the GROUP POLICY or to deny a claim unless: (a) The GROUP POLICY would not have been issued by STANDARD except for the misrepresentation; (b) The misrepresentation is contained in a written instrument signed by the POLICYOWNER; and (c) A copy of the written instrument has been given to the POLICYOWNER. The validity of the GROUP POLICY will not be contested after it has been in force for two years, except for non-payment of premiums. P0701A Part 8. EFFECT ON WORKER'S COMPENSATION The coverage provided worker's compensation obligation to provide under the 'ROUP POLICY is not insurance and does not relieve the worker's compensation insurance. . substitute for EMPLOYER of any P080lA Printed (6/05/89) - 24 - 602422 LTD POLICY