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I CITY OF SAN illERIORDINO - RBQU.ST ChR COUNCIL ACTION.
Gordon R. Johnson
From: Direct:or of Persalne1
REC'D. - ADMIHsJli&:t:
1989 fES 28 AM lQ: 12
Resolution to auth>rize the execution of .
an ameudment to the agreEIllE!l1t with Jonn
Haooock Life Insurance CcIlpmy, to ch.m;Ie
the rates for City-paid life insurance
fram $.43/$1000 to $.56/$1000 effective
February 1, 1989.
Dept: Persamel
DIte: February 23, 1989
Synopsis of Previous CouncillCtion:
t
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None.
Recommended motion:
1\dopt resolution.
~ IG r:lL-.
. Sig~re . -
Contact penon:
Gordon R. Johnsen
Phone:
5161
Supporting dlte attached:
WII'd :
FUNDING REQUIREMENTS:
Amount: $' .5nn
Source: (Acct. No.)
784-00020224 (Life Insurance Acct.)
(Acct. DescriDtionl
Finlllce:
(~xJl'
Council Notes:
75-0262
Agenda Item No
4.t:)
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I CIT~ OF SAN BERARDINO - REQUEST ~R COUNCIL ACTION
STAFF REPORT
The John Hancock employee term life insurance policy provides
the following amounts of . city-paid insurance for the listed
bargaining units:
o Management
o Confidential
o Middle Management
o General
o Police
o Fire
$50,000
$25,000
$10,000
$ 5,000
$ 5,000
$ 3,000
Retirees may purchase the amount of insurance listed above
that they are insured for on the date prior to retirement.
Their amount of insurance decreases to 25% of the above
values when the retiree turns 70 years old. There are
presently 282 retirees who have this coverage.
CUrrently, the rate for this insurance is 43 cents per $1000
each month whether for active or retired employees. That rate
has been in effect since April 1, 1987. However, we are
facing a rate increase this year due to our experience during
1988. John Hancock has given us two options for funding it
effective January 28, 1989:
OPTION 1
Combined rate
56 cents
OPTION 2
Separate rates
Actives
Retirees
43 cents
$1.72
During 1988, the city spent $48,500 for this benefit. Under
option 1, the added monthly cost to the city would be about
$1500. Under option 2, there would be no added cost to the
city since the retirees would pick up the entire added
charge. The total cost for this option from January 28
through July 31, 1989, would be about $9000.
I have only projected the costs for this option through July
31, 1989, so that the life insurance contract will coincide
with the PERS medical plans contract year. I plan to seek
proposals from various insurance companies for providing life
insurance starting August 1, 1989, to insure we are getting
the best available rate.
I recommend that all of our employee-related insurance plans
(ie: dental, vision, life insurance, LTD and AD&D) be changed
to an August 1 rate effective date beginning this year, so
that all rate changes will have the same effective date and
the new rates will be known in time to incorporate the city's
portion of them in the new budget each year.
I recommend option 1 since it would maintain past practice
and cushion the impact on retirees.
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RESOLUTION NO.
RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE
EXECUTION OF AN AMENDMENT TO THE AGREEMENT WITH JOHN HANCOCK
LIFE INSURANCE COMPANY, RELATING TO A CHANGE IN RATES FOR
CITY-PAID LIFE INSURANCE FROM $.43/$1000 TO $.56/$1000
EFFECTIVE FEBRUARY 1, 1989.
BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AS FOLLOWS:
SECTION 1. The Director of Personnel of the City of San
Bernardino is hereby authorized and directed to execute on
behalf of said City an amendment to agreement with John
Hancock Life Insurance, relating to a change in rates
effective February 1, 1989, affecting the City-paid life
insurance.
I HEREBY CERTIFY that the foregoing resolution was duly
adopted by the Mayor and Common Council of the City of San
Bernardino at a
meeting thereof held on the
day of
, 1989, by the following vote to wit:
AYES:
Council Members
NAYS:
ABSENT:
CITY CLERK
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AMENDMENT
COMPANY ,
INSURANCE
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TO THE AGREEMENT WITH JOHN HANCOCK LIFE INSURANCE
RELATING TO A CHANGE IN RATES FOR CITY-PAID LIFE
EFFECTIVE FEBRUARY 1, 1989.
The foregoing resolution is hereby approved this
day
of
, 1989.
Evlyn Wilcox, Mayor
City of San Bernardino
Approved as to form and legal content:
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AMENDMENT TO AGREEMENT
(life insurance)
THIS AMENDMENT TO AGREEMENT is entered into effective
5 COMPANY OF BOSTON, MASSACHUSETTS and the CITY OF SAN BERNAR-
February 1, 1989, between JOHN HANCOCK MUTUAL LIFE INSURANCE
6 DINO, a municipal corporation, "City".
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The parties agree as follows:
1.
Recitals.
(a) John Hancock Life and City entered into an
agreement on . April 1, 1987
, under which agreement term
11 life insurance is provided certain City employees and their
12 dependents, and accidental death and dismemberment insurance
13 is provided by John Hancock Life to participating employees.
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(b) John Hancock Life and City now desire to amend
15 the agreement to provide for a rate increase from $.43/$1000
16 of life insurance to $.56/$1000 of coverge, effective through
17 December 31, 1989.
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2.
Other Provisions. All other terms, conditions and
19 covenants of the agreement shall remain in full force and
20 effect.
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IN WITNESS WHEREOF, the parties hereto have executed
22 this Amendment to Agreement on the dates set forth below.
23 JOHN HANCOCK LIFE INSURANCE COMPANY
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AMENDMENT TO AGREEMENT (life insurance)
Page 2
CITY OF SAN BERNARDINO
By
Mayor
Date
I- ATTEST:
I
City Clerk
Approved as to form in legal content:
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