LCUB approves life insurance plan, carrier changesLenoir City Utilities Board approved a policy change and carrier change for LCUB life insurance at its Monday, Aug. 19 meeting.
Lenoir City Vice Mayor Harry Wampler abstained.
“As for the life insurance, as it stood tonight, there are no significant changes for active employees, but there are changes for retired employees and the board decided to actually add additional coverage where it was $1,000 up to $2,000 in previous plans,” LCUB general manager M. Shannon Littleton said.
A new step-down process dictates the amount beneficiaries would receive upon the death of a retired LCUB employee.
“The breakdown is new as well, because once you’re retired under the old plan, all that was available was that $1,000 to $2,000, and now it starts stepping down from $25,000,” Littleton said. “So at retirement age, up to age 65, it’s $25,000. From 65 to 70, it’s $10,000 and from 70 to 75, it’s $5,000, and of course, we just discussed, the 75 on was $0.”
But people in that 75-and-older age range will not receive $0. LCUB also voted on a new policy.“If a retiree reaches 75 years of age under the old plan, let’s say he’s 76 or she’s 76 years of age and passes away, his or her beneficiary would receive $1,000,” Littleton said. “Under this plan, the plan itself, the beneficiary, 76, receives $0. But the plan did put in a provision tonight to allow $1,000 by policy, not by insurance plan per se but policy, we’re still going to keep the $1,000 in tact for 75 years and above.”
The board passed a motion to create this policy, as well as to address a specific case.
“Our coverage for our old policy ended July 1, and we have to make premium coverage for the new plan,” Littleton said. “The only problem is there may be a couple of days lapse for the 75-year-old-and-above issue. We’re not clear about that currently, but there could be an issue for that lapse in coverage and if there are, the board voted tonight to pay that $1,000 out of the general fund because we’re going to do it anyway. ... Unfortunately, we had someone pass away during this few days here, few weeks of preparing and if there was an issue where that was not covered, the board said, ‘OK, we’ll go ahead and pay that $1,000 out of the general fund tonight.’”
Littleton also will look into spouse coverage.
“There’s a life insurance coverage for the spouse. If a spouse passes away while there’s an active employee working at LCUB, under the old plan, the active employee would receive $1,000 upon the spouse’s death,” he said. “The mayor thought it was important that we raise that.”