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HomeMy WebLinkAbout55A - HARTFORD INSURNACEREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: DECEMBER 17, 2019 TITLE: ADOPT RESOLUTION AUTHORIZING THE PURCHASE OF BASIC LIFE INSURANCE, ACCIDENTAL DEATH AND DISMEMBERMENT BENEFIT, SUPPLEMENTAL LIFE INSURANCE, AND LONG-TERM DISABILITY INSURANCE FOR EMPLOYEES THROUGH THE HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY {STRATEGIC PLAN NO. 7; 61 CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 11' Reading ❑ Ordinance on 2n° Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO /s/Kristine Ridge FILE NUMBER CITY MANAGER RECOMMENDED ACTION 1. Adopt a resolution authorizing the purchase of basic life insurance, accidental death and dismemberment benefit, supplemental life insurance and supplemental death and dismemberment benefit, dependent life insurance and long-term disability insurance for City employees through Hartford Life and Accident Insurance Company beginning January 1, 2020. 2. Receive and file renewal rates for employee basic life, supplemental life, dependent life insurance, long-term disability, and accidental and dismemberment benefits, and supplemental accidental death and dismemberment for the calendar year 2020. DISCUSSION The City contracted with Aetna Life Insurance for Basic Life and Supplemental Life, Long -Term Disability Insurance and Accidental Death and Dismemberment with an automatic yearly renewal. The Hartford acquired Aetna Life Insurance business on November 1, 2017, and is now the administrator and reinsurer for this insurance coverage. Coverage and service with Aetna terminated effective August 31, 2019 and became effective with The Hartford on September 1, 2019, the policy with The Hartford reflected choices and information on file with Aetna. The renewal billing guarantee period with Aetna was approved from January 1, 2015 through January 1, 2020. The Hartford assumed the rate guarantee through January 1, 2020 as well (Exhibit 1). Keenan and Associates is the broker of record for the agreement with The Hartford. The broker is eligible to receive compensation from The Hartford if they choose to participate in The Hartford's incentive programs as described in Exhibit 1. 55A-1 Agreement with The Hartford Life December 17, 2019 Page 2 of 2 Staff is recommending that the City renew the agreement with The Hartford on January 1 of each year, beginning in 2020. The rate guarantee is for one (1) year beginning January 1, 2020 through December 31, 2020. The rates did not increase for the plan year 2020 (Exhibit 2). However, plan benefits changed slightly for Basic Life Insurance and Long Term Disability due to some bargaining unit contract approvals approved by the City Council this past year. The schedule(s) of insurance for the policy benefits with The Hartford are as follows: 1. Basic Life Insurance 2. Supplemental Life Insurance 3. Dependent Life Insurance 4. Long Term Disability Insurance 5. Accidental Death and Dismemberment Benefit 6. Supplemental Dependent Accidental Death and Dismemberment Benefit STRATEGIC PLAN ALIGNMENT Approval of this item allows the City to meet Goal #7 — Team Santa Ana, Objective #6 (Provide a positive workplace environment that supports the health of its employees and celebrates its success). FISCAL IMPACT There is no additional fiscal impact associated with this agreement. Funds are budgeted and available in the amount of $680,300 for FY 2019-20, Human Resources Benefits Account (account no. 08109053-64010) to pay for group insurance premiums in which commissions are included, employees pay their own premiums for supplemental life insurance benefits. APPROVED AS TO FUNDS AND ACCOUNTS: Steven V. Pham Kathryn Downs, CPA Executive Director Executive Director Human Resources Agency Finance and Management Services Agency Exhibits: 1. Resolution; Terms and conditions for basic life insurance, supplemental life insurance, dependent life insurance, accidental death and dismemberment benefit and supplemental accidental death and dismemberment benefit. 2. The Hartford Renewal Rates for calendar year 2020 55A-2 EXHIBIT 1 RESOLUTION NO. 2019-XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA AUTHORIZING THE PURCHASE OF BASIC LIFE INSURANCE, ACCIDENTAL DEATH AND DISMEMBERMENT BENEFIT, SUPPLEMENTAL DEPENDENT ACCIDENTAL DEATH AND DISMEMBERMENT BENEFIT; SUPPLEMENTAL LIFE INSURANCE, DEPENDENT LIFE INSURANCE, AND LONG TERM DISABILITY INSURANCE FOR EMPLOYEES THROUGH THE HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1: The City Council of the City of Santa Ana hereby finds, determines and declares as follows: A. In its current Memorandums of Understanding ("MOU") between the City and its employee unions, Executive Management benefit Resolutions, and employment agreements with appointed officials, the City Council has approved the provision of various life insurance and other benefits that include, life insurance, accidental death and dismemberment benefit, supplemental life insurance, dependent life insurance, supplemental accidental death and dismemberment benefit, and long-term disability insurance ("insurance and benefits"). B. From January 1, 2015 to December 31, 2019, the City contracted with Aetna Life Insurance for these insurance and benefits. The City's current policy with Aetna Life Insurance was taken over by The Hartford Life and Accident Insurance Company ("The Hartford") effective September 1, 2019. However, the rate guarantee originally offered by Aetna expires December 31, 2019. C. The City contracts with a broker, Kennan & Associates, for securing many employee benefits including dental insurance, life insurance, accidental death and dismemberment benefit, supplemental life insurance and long term disability insurance. Kennan & Associates periodically reviews the City's insurance and benefits to make sure that the rates and coverages are competitive in the marketplace. D. The Hartford has offered coverage for the insurance and benefits pursuant to the terms and conditions attached hereto and marked as Exhibit " 1" and incorporated herein as though fully set forth. The terms and conditions satisfy the City's obligations to provide these benefits pursuant to MOUs 55A-3 with the various employee organizations, Executive Management benefit Resolutions, and employment agreements with appointed officials. E. Pursuant to the authorization requested in this Resolution, the City will continue to purchase the insurance and benefits through the Hartford until coverage is cancelled by the City. F. The Hartford has provided a rate guarantee for January 1, 2020 to December 31, 2020 for the insurance and benefits on the terms set forth in Exhibit "1". The rate guarantee along with the coverages are attached hereto as Exhibit "2" and incorporated herein as though fully set forth. G. The rate guarantee offered by The Hartford is competitive in the marketplace as evaluated by the City's broker and does not increase the rates offered by Aetna for 2019. H. The City will receive annual renewal notices for the upcoming year for The Hartford's proposed premiums for the insurance and benefits coverages authorized pursuant to this Resolution. Each year, City staff will provide the annual renewals notices to the City Council for review. Section 2: The City Council of the City of Santa Ana approves the purchase of basic life insurance, supplemental life insurance, dependent life insurance, long term disability insurance, accidental death and dismemberment benefit and supplemental dependent accidental death and dismemberment benefit for employees through The Hartford Insurance Company pursuant to the terms and conditions set forth in Exhibit "1" starting January 1, 2020 until cancelled. Section 3: The City Council of the City of Santa Ana authorizes and delegates to the City Manager the authority to execute and/or sign any documents, paperwork, and/or policies necessary to procure the insurance and benefits through the Hartford, as set forth In Section 2 of this Resolution. Section 4: This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. ADOPTED this 17th day of December, 2019. Miguel A. Pulido Mayor 55A-4 APPROVED AS TO FORM: Sonia R. Carvalho City Attorney By: '&UAa, Laura A. Rossini Senior Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, DAISY GOMEZ, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2019- to be the original Resolution adopted by the City Council of the City of Santa Ana on December 17, 2019. Date: Clerk of the Council City of Santa Ana 55A-5 HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY One Hartford Plaza, Hartford, Connecticut 06155 (A stock insurance company, herein called The Company) will pay benefits according to the terms and conditions of The Policy. Name of Policyholder: CITY OF SANTA ANA Policy Number: GUGLT-803893 Anniversary Date: January 1 of each year, beginning in 2020 Policy Effective Date: September 1, 2019 Premium Due Dates: Monthly, on the first day of each policy month Signed for The Company: Lisa Levin, Secretary Place of Delivery: California Michael Concannon, President Countersigned by..................................................................... Licensed Resident Agent or Registrar RIGHT TO RETURN THE POLICY: YOU HAVE THE RIGHT TO RETURN THE POLICY WITHIN 30 DAYS AFTER ITS RECEIPT VIA REGULAR MAIL OR OTHER DELIVERY METHOD AND TO HAVE THE FULL PREMIUM AND MEMBERSHIP FEES REFUNDED. THE RETURN VOIDS THE POLICY FROM THE BEGINNING. THE PARTIES SHALL BE IN THE SAME POSITION AS IF NO CONTRACT HAD BEEN ISSUED. ALL PREMIUMS PAID AND ANY POLICY FEE SHALL BE FULLY REFUNDED BY US, AND ANY MEMBERSHIP FEE SHALL BE FULLY REFUNDED BY THE ENTITY CHARGING THE FEE, WITHIN 30 DAYS OF OUR RECEIPT OF THE RETURNED POLICY. IF, AT THE TIME OF APPLICATION OR AT THE TIME OF DELIVERY OF A GROUP TERM LIFE INSURANCE POLICY OR CERTIFICATE, AN INSURER, ITS AGENT, GROUP MASTER POLICYOWNER, OR ASSOCIATION COLLECTS MORE THAN ONE MONTH'S PREMIUM FROM AN INDIVIDUAL WHO IS 60 YEARS OF AGE OR OLDER ON THE DATE HE OR SHE PURCHASED COVERAGE, THE INSURER SHALL PROVIDE THE INDIVIDUAL WITH A PRORATED REFUND OF THE PREMIUM IF THE INDIVIDUAL DELIVERS A CANCELLATION REQUEST TO THE INSURER DURING THE FIRST 30 DAYS OF THE POLICY PERIOD. Form GBD-1000 A (10/08) (CA) Table of Contents Schedule of Insurance 3 Premium Provisions 4 Policy Provisions 8 y Incorporation Provision 10 Form GBD-1000 A (10108) (CA) 55A-7 SCHEDULE OF INSURANCE The Schedule(s) of Insurance for The Policy benefits listed below are shown in the Certificate(s) of Insurance, as incorporated into The Policy. 1) Basic Life Insurance 2) Supplemental Life Insurance 3) Dependent Life Insurance 4) Long Term Disability Insurance 5) Accidental Death and Dismemberment Benefit 6) Supplemental Dependent Accidental Death and Dismemberment Benefit The Schedule(s) of Insurance will address the: 1) benefit amounts and maximum limits; 2) eligibility and effective date requirements; and 3) other schedule amounts and limits; which apply to the employees of the Policyholder. Form GBD-1000 A (10/08) (CA) y � • PREMIUM PROVISIONS Initial Monthly Premium Rates The initial monthly premium rates to be charged for employee coverage and/or child/spouse coverage, if applicable, are shown on the following page(s). The first premium is due and payable on the effective date of The Policy. Subject to The Policy's grace period provision, all premiums after the first must be paid when or before they are due. Premiums are based on the employee's age on his or her effective date and thereafter on the first day of the month following the month in which his or her birthday occurs. For Lang Term Disability Benefits, the amount of an employee's Indexed Pre -disability Earnings which is disregarded in determining his or her Monthly Benefit because of the Maximum Monthly Benefit limitation will also be disregarded in determining the amount of the total insured payroll. The Initial Monthly Premium Rates may be converted as follows To Convert Rates to: Use a Conversion Factor of: annual rates 11.8227 semi-annual rates 5.9557 quarterly rates 2.9852 Grace Period The Company will allow the Policyholder a 60 day grace period for the payment of all premiums after the first. During this 60 day period, The Policy will stay in force. If the owed premium is not paid by the 60th day, The Policy will automatically terminate. If the Policyholder gives The Company written advance notice of an earlier cancellation date, The Policy will terminate on the earlier date. Premium is due for each day The Policy is in force. Monthly Premium Rate Guarantee Initial Monthly Premium Rates are guaranteed as follows: Benefit Rate Guarantee Period Long Term Disability Benefits until January 1, 2020 Basic Life Insurance until January 1, 2020 Supplemental Life Insurance until January 1, 2020 Supplemental Dependent Life Insurance until January 1, 2020 Basic Accidental Death and Dismemberment Benefit until January 1, 2020 Supplemental Accidental Death and Dismemberment Benefit until January 1, 2020 Subject to the Rate Guarantee Period shown above, The Company has the right to change premium rates on any premium due date if: 1) written notice is delivered to the Policyholder's last address on record; and 2) the change is effective at least 31 days after the date of notice. The Rate Guarantee Period supersedes only those provisions appearing elsewhere in this Policy which give The Company the right to change the premium rates, and then, only for the period of time for which the rates are guaranteed. However, The Company may change the premium rates during the Rate Guarantee Period if there is a change in The Policy, or if there is a 10% increase or decrease in the number of insured Employees, or if the Policyholder adds or deletes a subsidiary or affiliated business entity. The Company may also change the premium rates during the Rate Guarantee Period if there has been a material misstatement in the reported experience during the pre -sale process. The Rate Guarantee Period in no way affects, amends or supersedes any other provision in The Policy. Form GBD-1000 A (10/08) (CA) 4 55A-9 PREMIUM PROVISIONS Calculation Premiums may be calculated by multiplying the rate times the applicable number of units of coverage. If any insurance is added, increased or becomes effective after The Policy is in force, the premium charges will begin on 1) the day the coverage is effective, if it is also the first day of a policy month; or 2) the first day of the next policy month. For insurance which is terminated, premium charges will stop as of the first day of the next policy month. With respect to Dependent Life Insurance only, the premium rate per Dependent unit or per $1,000 of insurance, whichever is applicable, will be based on actuarial assumptions, due to the difficulty in obtaining the ages of all Dependents who are covered under this benefit. The actuarial assumptions will produce, in the opinion of The Company, the same total amount of premium as would be obtained by the use of the actual ages of the Dependents covered. Premiums may be calculated by any other method which both The Company and the Policyholder agree to in writing. Premium Payments Premium payments are due and payable in full to a place designated by The Company or, with respect to the initial premium payment, premium payments may be made to an authorized agent of The Company. The pre -payment of premiums for a particular period by the Policyholder is not a guarantee that The Policy will remain in force. All premiums due under The Policy shall be remitted by the Policyholder or the Policyholder's designee to The Company on or before the due date. Form GBD-1000 A (10/08) (CA) 5 55A-10 PREMIUM SCHEDULE Long Term Disability Benefits: CITY OF SANTA - LTD CORE: $8.78 per insured person CITY OF SANTA ANA - LTD B/U: $15.93 per insured person CITY OF SANTA ANA: $.352 per $100 of covered payroll Basic Life Insurance: $.102 per $1,000 Supplemental Life Insurance: For each $1,000 of Supplemental Life Insurance the monthly premium rate shall be determined in accordance with the employee's age as follows: Employee Age Rate Less than 30 $.055 30 - 34 $.083 35 - 39 $.11 40 - 44 $.166 45 - 49 $.294 50 - 54 $.552 55 - 59 $.672 60 - 64 $1.095 65 - 69 $1.978 70 - 74 $1.978 75 or over $1.978 Supplemental Dependent Life Insurance: Spouse: For each $1,000 of Supplemental Dependent Life Insurance the monthly premium rate shall be determined in accordance with the employee's age as follows: Employee Age Rate Less than 30 $.055 30 - 34 $.083 35 - 39 $.11 40 - 44 $.166 45 - 49 $.294 50 - 54 $.552 55 - 59 $.672 60 - 64 $1.095 65 - 69 $1.978 70 - 74 $1.978 75 or over $1.978 Child(ren): $.10 per $1,000 unit Basic Accidental Death & Dismemberment and $.02 per $1,000 Loss of Sight Benefit: Supplemental Accidental Death & Dismemberment and Loss of Sight Benefit: Form GBD-1000 A (10/08) (CA) 55A-11 PREMIUM SCHEDULE SUPP AD&D - EMPLOYEE ONLY: $.03 per $1,000 SUPP AD&D - FAMILY: $.03 per $1,000 Form GBD-1000 A (10/08) (CA) 55A-12 POLICY PROVISIONS Entire Contract The contract between the parties consists of: 1) The Policy; 2) any Certificate(s) of Insurance incorporated and made a part of The Policy; 3) any riders issued in connection with such Certificate(s) of Insurance; 4) the Policyholder's application, if any, a copy of which is attached to and made a part of The Policy when issued; and 5) any individual application submitted by the Employee and accepted by The Company in connection with The Policy. All statements made by the Policyholder, or persons insured under The Policy will be deemed representations and not warranties. No statement made to affect this insurance will be used in any contest unless it is in writing and a copy of it is given to the person who made it, or to his or her beneficiary or personal representative. Incontestability Except for non-payment of premium, the insurance provided by The Policy cannot be contested after such insurance has been in effect for a period of 2 years. Changes The Company reserves the right to make changes in The Policy, after The Policy has been in force for 12 months. The Company will give the Policyholder 31 days advance written notice of any change. No agent has authority to change or waive any part of The Policy. To be valid, any change or waiver must be in writing, approved by one of our officers and made a part of The Policy. Clerical Error Clerical error (whether by the Policyholder, the Plan Administrator, or The Company) in keeping the records having to do with The Policy, or delays in making entries on the records, will not void the insurance of any person if that insurance would otherwise have been in effect. A clerical error will not extend the insurance of any person if that insurance would otherwise have ended or been reduced as provided by The Policy. When a clerical error is found, premiums and benefits will be adjusted based on the true facts and The Policy. Conformity with Law If any provision of The Policy is contrary to the law of the jurisdiction in which it is delivered, such provision is hereby amended to conform to that law. If any change to state or federal law, including but not limited to the Federal Social Security Act, affects The Company's liability under The Policy, The Company may change The Policy, the premiums or both. Such change: 1) will be effective as of the date of the change to the state or federal law; and 2) will not be made until The Company gives the Policyholder 31 days notice. Termination of Policy The Company may terminate The Policy for the following reasons by giving the Policyholder 31 days written notice: 1) the Policyholder fails to furnish information necessary to the administration of the Policy; 2) the Policyholder fails to perform any of its obligations necessary to the administration of this Policy; 3) Less than 100% of the persons eligible for coverage on a Non-contributory basis are insured; 4) Less than 25% of the persons eligible for coverage on a Contributory basis are insured; or 5) Fewer than 10 persons are insured. In addition, The Company may terminate this Policy on any premium due date after The Policy has been in force for 12 months by providing 31 days written notice. If The Policy is terminated, the Policyholder is responsible for providing notice to insureds of their right to convert under The Policy. The Company reserves the right to terminate Dependent Life Insurance Benefits on any premium due date on which: 1) there are fewer than 10 persons insured for Dependent coverage; or 2) less than 25% of the persons eligible for Dependent coverage on a Contributory basis are insured. The Company shall give the Policyholder 31 days notice of its intent to terminate the Dependent Life Insurance Benefit. Form GBD-1000 A (10/08) (CA) 8 55A-13 POLICY PROVISIONS Certificate(s) of Insurance The Company will give individual Certificate(s) of Insurance to: 1) the Policyholder; or 2) any other person according to a mutual agreement among the other person, the Policyholder, and The Company; for delivery to persons covered under The Policy and which will explain the important features of The Policy. Data To Be Furnished The Policyholder, or any other person designated by the Policyholder, will give The Company all information The Company needs regarding matters pertaining to the insurance. At any reasonable time while The Policy is in force and for 12 months after that, The Company may inspect any of the Policyholder's documents, books, or records which may affect the insurance or premiums of The Policy. The Policyholder will, upon our request, give The Company: 1) the names of all persons initially eligible for coverage; 2) the names of all additional persons who become eligible for coverage; 3) the names of all persons whose amount of insurance is to be changed; 4) the names of all persons whose eligibility or insurance is terminated; and 5) any data necessary to administer the insurance provided by The Policy. If the Policyholder gives The Company any incorrect information, the relevant facts will be determined to establish if insurance is in effect and in what amount. No person will be deprived of insurance to which he is otherwise entitled or have insurance to which he is not entitled, because of any misstatement of fact by the Policyholder. Any required adjustment may be made in premiums or benefits. Right to Audit The Company reserves the right to audit, once every 2 years, the Policyholder's billing records and premium accounting practices. If The Company discovers: 1) an underpayment of premium by the Policyholder, the Policyholder will be obligated to remit, in a timely manner, the underpayment amount; or 2) an overpayment of premium, The Company will return any overpayment amount in a timely manner; for the previous 2 year period. Not in Lieu of Worker's Compensation This Policy does not satisfy any requirement for worker's compensation insurance. Time Period All periods begin and end at 12:01 A.M., standard time, at the Policyholder's address. Disclosure of Fees The Company may reduce or adjust premiums, rates, fees and/or other expenses for programs under The Policy. Disclosure of Services In addition to the insurance coverage, The Company may offer noninsurance benefits and services to Active Employees. Form GB13-1000 A (10/08) (CA) 9 55A-14 INCORPORATION PROVISION The Certificate(s) of Insurance and Rider(s) listed below are attached to, incorporated in and made a part of, The Policy. Certificate(s) of Insurance Rider(s) Form GBD-1100 (10108) (CA) (803893) 1.08 Form GBD-1100 (10/08) (CA) (803893) 2.07 Form GBD-1100 (10/08) (CA) (803893) 3.05 Form GBD-1100 (10/08) (CA) (803893) 4.07 Form GBD-1100 (10/08) (CA) (803893) 5.05 Form GBD-1100 (10/08) (CA) (803893) 6.05 Form GBD-1200 (10/08) EM LTD (CA) (Rev-1) (803893) Form PA-9474 (10/08) EM (CA) 7.04 Form GBD-1200 (10/08) EM LTD (CA) (Rev-1) (803893) Form PA-9474 (10/08) EM (CA) 8.04 Form GBD-1200 (10/08) EM LTD (CA) (Rev-1) (803893) Form PA-9474 (10/08) EM (CA) 9.04 The provisions found in the Certificate(s) of Insurance will address the benefit plan, period of coverage, exclusions, claims and other general policy provisions pertaining to state insurance law requirements. Form GBD-1000 A (10/08) (CA) 10 55A-15 NOTICE OF PROTECTION PROVIDED BY CALIFORNIA LIFE AND HEALTH INSURANCE GUARANTEE ASSOCIATION This notice provides a brief summary regarding the protections provided to policyholders by the California Life and Health Insurance Guarantee Association ("the Association"). The purpose of the Association is to assure that policyholders will be protected, within certain limits, in the unlikely event that a member insurer of the Association becomes financially unable to meet its obligations. Insurance companies licensed in California to sell life insurance, health insurance, annuities and structured settlement annuities are members of the Association. The protection provided by the Association is not unlimited and is not a substitute for consumers' care in selecting insurers. This protection was created under California law, which determines who and what is covered and the amounts of coverage. Below is a brief summary of the coverages, exclusions and limits provided by the Association. This summary does not cover all provisions of the law; nor does it in any way change anyone's rights or obligations or the rights or obligations of the Association. COVERAGE Persons Covered Generally, an individual is covered by the Association if the insurer was a member of the Association and the individual lives in California at the time the insurer is determined by a court to be insolvent Coverage is also provided to policy beneficiaries, payees or assignees, whether or not they live in California. Amounts of Coverage The basic coverage protections provided by the Association are as follows. Life Insurance, Annuities and Structured Settlement Annuities For life insurance policies, annuities and structured settlement annuities, the Association will provide the following: o Life Insurance 80% of death benefits but not to exceed $300,000 80% of cash surrender or withdrawal values but not to exceed $100,000 o Annuities and Structured Settlement Annuities 80% of the present value of annuity benefits, including net cash withdrawal and net cash surrender values but not to exceed $250,000 The maximum amount of protection provided by the Association to an individual, for all life insurance, annuities and structured settlement annuities is $300,000, regardless of the number of policies or contracts covering the individual. Health Insurance The maximum amount of protection provided by the Association to an individual, as of July 1, 2016, is $546,741. This amount will increase or decrease based upon changes in the health care cost component of the consumer price index to the date on which an insurer becomes an insolvent insurer. Changes to this amount will be posted on the Association's website www.califega.org. (please turn to next page) Printed in U.S.A. CA v.5 55A-16 COVERAGE LIMITATIONS AND EXCLUSIONS FROM COVERAGE The Association may not provide coverage for this policy. Coverage by the Association generally requires residency in California. You should not rely on coverage by the Association in selecting an insurance company or in selecting an insurance policy. The following policies and persons are among those that are excluded from Association coverage: • A policy or contract issued by an insurer that was not authorized to do business in California when it issued the policy or contract • A policy issued by a health care service plan (HMO), a hospital or medical service organization, a charitable organization, a fraternal benefit society, a mandatory state pooling plan, a mutual assessment company, an insurance exchange, or a grants and annuities society • If the person is provided coverage by the guaranty association of another state • Unallocated annuity contracts; that is, contracts which are not issued to and owned by an individual and which do not guaranty annuity benefits to an individual • Employer and association plans, to the extent they are self -funded or uninsured • A policy or contract providing any health care benefits under Medicare Part C or Part D • An annuity issued by an organization that is only licensed to issue charitable gift annuities • Any policy or portion of a policy which is not guaranteed by the insurer or for which the individual has assumed the risk, such as certain investment elements of a variable life insurance policy or a variable annuity contract • Any policy of reinsurance unless an assumption certificate was issued • Interest rate yields (including implied yields) that exceed limits that are specified in Insurance Code Section 1607.02(b)(2)(C). NOTICES Insurance companies or their agents are required by law to give or send you this notice. Policyholders with additional questions should first contact their insurer or agent. To learn more about coverages provided by the Association, please visit the Association's website at www.califega.org, or contact either of the following: California Life and Health Insurance Guarantee Association P.O. Box 16860 Beverly Hills, CA 90209-3319 (323)782-0182 California Department of Insurance Consumer Communications Bureau 300 South Spring Street Los Angeles, CA 90013 (800)927-4357 Insurance companies and agents are not allowed by California law to use the existence of the Association or its coverage to solicit, induce or encourage you to purchase any form of insurance. When selecting an insurance company, you should not rely on Association coverage. If there is any inconsistency between this notice and California law, then California law will control. Printed in U.S.A. CA v.5 55A-17 Prepare. protect. prevail." THE ol 06/26/2019 HARTFORD Business Insurance Employee Benefits CITY OF SANTA ANA Auto 20 CIVIC CENTER PLAZA, M-24 Home SANTA ANA, CA 92701 Producer Commission and Incentive Programs for CITY OF SANTA ANA Dear Policy Holder: Thank you for giving The Hartford the opportunity to provide group benefits to your employees. We value your business and look forward to maintaining a long lasting relationship. As part of our commitment to you, we would like to take this opportunity to provide information regarding compensation your producer is eligible to receive from The Hartford. Our producer compensation programs reflect our fundamental belief in providing fair and competitive compensation that reward producers for their performance. Participation in Incentive Programs is voluntary. Your producer may decline to accept any payment upon written notice to The Hartford. Basic Life -Flat 10% Supplemental Dependent Life -Flat 10% Voluntary Life -Flat 10% Long Term Disability -Flat 10% Basic ADD -Flat 10% Supplemental ADD -Flat 10% Additional Compensation (Contingent and Supplemental) Your producer may earn additional compensation on Group Benefits business if they meet pre -described qualification criteria. Performance metrics reviewed annually to determine qualification include minimum premium retention percentages, new sales activity, and size of the producer's block of Group Benefits business with The Hartford. Available bonuses range from .30% to 5% of premium. Depending on the producer, payments are made quarterly, semi-annually, and/or annually. Payments made under the Partner Rewards Program (if applicable) are not included in the determination of your specific case premium. The costs of the Partner Rewards Program are incurred as general operating expenses of The Hartford. For ERISA Plans The Hartford reports commissions, contingent commissions (including Partner Rewards Program), fees and the value of non -cash compensation provided to producers on a Schedule A Worksheet to assist in your completion of Form 5500 in accordance with applicable law. cc: MARSHAWNBERECZ The Hartford® is The Hartford Financial Services Group, Inc. and its subsidiaries, including underwriting companies Hartford Life and Accident Insurance Company and Hartford Fire Insurance Company. Home Office is Hartford, CT. The Hartford is the administrator for certain group benefits business written by Aetna Life Insurance Company and Talcott Resolution Life Insurance Company (formerly known as Hartford Life Insurance Company). 02o1S by The Hadlord.Classification: Company Coufrdenb'al. No had o{Wytloc —14ipe Wood, published or used without the permission of The Hadlool Business lnsumnoe Employee Benefits Auto July 12, 2019 Home CITY OF SANTA ANA 20 CIVIC CENTER PLAZA, M-24 SANTA ANA, CA 92701 Important Information Regarding Your Aetna Group Life and Disability Coverage Dear Carrie Hanes, The Hartford acquired Aetna's U.S. Group Life and Disability business on November 1, 2017, and is now the administrator and reinsurer for this insurance coverage. As a result, your Group Life and Disability Insurance or service with Aetna will be transitioned to The Hartford. Your coverage and service will terminate with Aetna on August 31, 2019, and become effective with The Hartford on September 1, 2019, and your policy will reflect your choices and information on file with Aetna.' An Easy Transition for Your Employees Your employees will receive the same level of coverage with The Hartford, delivered with the Impeccable claims and service experience for which we're recognized. If there is a current claim in process during the transition of coverage, this will cause no disruption in claims service.2 Note that any life claim in progress on Aetna's Employee Secure Website needs to be submitted before your policy transition date --September 1, 2019—to ensure the claim is processed. Your New Group Benefits Experience As a new customer of The Hartford, we would like to introduce you to our Flexible products, convenient self-service tools and superior customer service. You can look forward to a seamless transition along with unchanged premium rates/fees guaranteed through your current rate guarantee period. The Hartford's Ability Advantage® As part of the upcoming transition of your Group Disability insurance from Aetna to The Hartford, your employees' claims will be managed through The Hartford's Ability Advantage claims and absence management platform. There will be no disruption in claims service during this transition. You and your employees can look forward to industry -leading benefits and absence administration powered with state-of-the-art technology. To enable early reported claims, we will transition open and historical disability claims approximately one month before your transition date. This means that you should begin using our Ability Advantage platform on July 29, 2019 for policy administration and claims management. We will be notifying claimants via a letter In mid -July. Your user IDs and passwords will remain the same — and your active and historical claims detail will be available once your claims have transitioned. You should continue to log in to Aetna's site until your claims have been transitioned to The Hartford's Ability Advantage. Your new experience includes the following new URI_ for claim self-service as well as a new phone number for your employees on claim. https://abilityadvantage.thehartfoi d. coin 888-301-5615 Your transition to The Hartford's Ability Advantage platform will provide you many new services, capabilities and areas of expertise in the future. See the enclosed document to understand your online experience beginning July 29. Product Comparison Guide There are certain instances where Aetna's policies may differ from The Hartford's. The Group Life and Disability products arc similar in their coverage, but there is some differentiation between contracts. A comparison of key differences in The Hartford and Aetna policies is enclosed for your reference? 55A-19 Administrative Services and Other Non -insurance Agreements If you have an Administrative Services Agreement through which Aetna provided administrative services for self -insured Group Disability Benefits or Leave Management, the contract will be assigned to The Hartford when your Group Insurance coverage transitions to The Hartford. Also, in order to ensure a smooth transition, where it makes sense and to the extent possible, any other related non -insurance agreements currently in place with Aetna will be assigned to The Hartford." As of the effective date of the assignment, The Hartford replaces Aetna as a party to the assigned agreements. You do not have to take any action to accept this change. Please keep this notice of assignment with your Aetna Group Benefits agreements and continue to make your service fee payments as you do today. Since active claimants will receive payments from both Aetna and The Hartford in 2019, you will receive individual reports split by each company's Federal Employer Identification Number (FEIN). This is due to government regulatory requirements that all Disability benefit payments must be segregated by the FEIN under which those payments were made (Aetna or The Hartford). Therefore, for year-end 2019, you will receive the following Individual reports based on FEIN: • THIRD -PARTY SICK PAY STATEMENT • UNEMPLOYMENT TAXABLE WAGE REPORT • DISABILITY PAYMENT REPORT In addition, if you are responsible for making all Employer FICA tax payments (CASDI and Medicare) directly to the government, the FICA Detailed Tax Pass Back Report will also be split individually by each company's FEIN. Next Steps ✓ Continue To Pay Any Invoices From Aetna During the transition of your coverage, if you receive any invoices from Aetna for outstanding premium, continue to make those payments addressed to Aetna, in the same way you make payments today. ✓ Payment Of Your September Invoice From The Hartford You will receive your September 2019 invoice from The Hartford by the end of August. Your payment of this invoice will confirm the transition of your coverage to The Hartford. Payment instructions will be provided with the invoice, Be sure that this and all future payments are made to The Hartford, not Aetna. ✓ A Representative From The Hartford Will Be Contacting You Your Client Relationship Manager will call you to explain yourtransltion process and answer any questions you may have. ✓ Watch For Your Welcome Email In the next couple of weeks, we will send you an email with resources to help you and your employees transition to The Hartford. ✓ Policy Certificates and Notices Once your Hartford policy is in our online employer portal, you can easily access your policy booklets and certificates online. Please provide updated certificates to your employees. At The Hartford, we value your business and look forward to continuing to serve you and your employees in an even greater capacity. You will soon be contacted by The Hartford, but feel free to reach out to us if you have questions in the meantime. You may contact your Client Relationship Manageror our Customer Service Department by email at gbdcustomerservice@theharlford.com or by phone at (800) 523.2233 Monday through Friday, 8 a.m. to 8 p.m. ET. Sincerely, / f _ Lori High Senior Vice President Sales and Relationship Management Group Benefits The Hartford 55A-20 Business Insurance Employee Benefits Auto Home This includes the tax treatment of benefits, and other tax inform atlon contained in the Aetna Agency Agreement for Sick Pay. This also includes producer commissions. The Hartford compensates both internal and external producers for the sale and service of our products. In most cases, producers are paid a commission, which is fixed or based on a percentage of the premium, In addition, producers may be eligible for the various forms of incentive compensation, including contingent commission and other non -cash awards. Please visit our web site for more information on The Hartford's compensation program at htto�//thehartford com/orouo-benefits-producer-compensation or contact your Hartford representative. 2 If any employee has applied for coverage that is pending with Aetna, or approved by Aetna but not effective under the Aetna policy as of the date of the transition, they may be required to complete a Hartford application before coverage can become effective with The Hartford. The enclosed document is a high-level comparison of your Aetna benefits against The Hartford's benefit availability; it is not a line -by-line comparison and may not reflect all of the differences between your Aetna contract and your Hartford contract. < Examples of agreements that will be assigned to The Hartford include: Administrative Services Agreements, Master Services Agreements, Aetna Agency Agreements for Sick Pay and other agreements regarding FICA and tax treatment of benefits, Confidentiality and Non -Disclosure Agreements, plan sponsor letters, and WorkAbility self-service software licensing agreements. Provisions relating to Aetna medical, dental or other benefits which are not part of the business acquired by The Hartford will not be assigned to The Hartford and will remain with Aetna. In addition, there are other agreements and provisions that have not been assigned, including the following examples about which your Relationship Manager will contact you to discuss: performance or service guarantees, and contracts relating to paid -up coverage, reserve buyout agreements and other funding or deposit agreements. The Hartford® is The Hartford Financial Services Group, Inc. and its subsidiaries, including underwriting companies Hartford Life and Accident Insurance Company and Hartford Fire Insurance Company. Home Office is Hartford, CT. The Hartford is the administrator for certain group benefits business written by Aetna Life Insurance Company and Talcott Resolution Life Insurance Company (formerly known as Hartford Life Insurance Company). Copyright © 2019 by The Hartford. Confidential. All rights reserved. No part of this document may be reproduced, published or posted without the perrnlssion of The Hartford. Disability Form Series includes GBD-1000, GBD-1200, or state equivalent. Life Forth Series includes GBD-1000, GBD-1100, or state equivalent. 7261 b NS 07119 206352873_2 LAW 55A-21 SIDE -BY -SIDE PRODUCT COMPARISON THE HARTFORD This document prepared for City of Santa Ana shows certain instances where Aetna's policies may differ from The Hartford's. The products are similar in their coverage, but there is some differentiation between the contracts. This document provides a high-level overview of these key differentiations. The provisions and practices referenced below have been extracted or described for comparison purposes and may not reflect the complete provisions. Benefits are subject to state availability.' Eligibility - Employees working outside the U.S were addressed administratively. Handicapped Children - Child does not need to be disabled before reaching the limiting age and proof of handicap is not required to be submitted within 31 days after the date child reaches the maximum age under plan. Evidence of Insurability (EOI) - NOT required for salary increases that place a benefit above the Guarantee Issue (GI) amount. Accelerated Death Benefit - 75%, up to $500,000 and 24-month terminal illness period is standard offering. Accelerated Death Benefit (ADS) - Terminal illness along with medical condition triggers included as triggers to apply for ADB. Family Status Change (FSC) - Not Included. Handled administratively. Reinstatement - Not standardly included. Eligibility - Employees working outside the U.S. must be addressed in the contract. Handicapped Children - Child must be disabled prior to reaching limiting age and proof Is required within 30 days from 26th birthday. Evidence of insurability (EOI)- Required for first salary increase that places a benefit above the Guarantee Issue (GI) amount. Accelerated Death Benefit - 60%, up to $500,000 and 12 months terminal illness period is standard offering. Accelerated Death Benefit (ADB) - Terminal illness only. Medical conditions not included as a trigger for applying for ADS. Family Status Change (FSC) - Standardly included in contract. Reinstatement - 12-month reinstatement period. Need to identify all eligible employees when converting in order to ensure accurate eligibility is reflected in The Hartford's contract. The Hartford's contract has tighter requirements around coverage on handicapped children. The Hartford's contract can match this benefit; however, state restrictions may apply. The Hartford can match the 24-month terminal illness period, however, state restrictions may apply. The Hartford does not offer'medical conditions' as a trigger for applying for ADB. The Hartford's contract places clarity and parameters around what constitutes a Family Status Changes (FSC) and what changes in coverage are allowed. Under The Hartford's contract, remstatement is allowed if rehired within 12 months. 55A-22 Premium Waiver — No refund of premium back to date disability started for supplemental (contributory) coverage. Dependent Life and all AO&O coverage ends once employee is approved for extension. Qualifying period will start over If employee returns to work at any time during qualifying period. Dependent coverage that Is contributory is not part of premium waiver. Death prior to premium waiver approval, claim may be payable with or without payment of premium, Portability — Under port, employee remains covered for the exact same provisions under the existing policy. Coverage can be ported up to the age of ga. Employee and spouse coverage, provided premium Is paid may extend to age 99, Amounts over $500,000 may require evidence of insurability. Two-year suicide exclusion only Included under port if person was covered less than two years on group plan. Employee must part coverage In order for dependent spouselchild to part. Once coverage is ported, If employee dies, dependents lose ported coverage. III or Injured persons cannot port coverage. Accelerated Death benefit not offered under ported coverage. Portability is offered if employment ends due to retirement. Accidental Death coverage may be purchased if covered for AD&O on underlying group plan. Conversion not available if ported coverage ends. Premium Waiver — Automatic approval for premium waiver upon terminal Illness diagnosis. Refund of premium once premium waiver is approved back to date of disability. Attempt to return to work does not impact qualifying period if less than 5 days. Dependent coverage that is contributory can be extended without premium if employee remains eligible for premium waiver. When policy terminates, dependent coverage that was allowed to continue ends. Death prior to premium waiver approval, claim only payable if premium received. Portability — The employeewill be issued a new certificate under their port policy. Coverage can be ported up to the age of 75. Employee and spouse coverage, provided premium is paid may extend to age 75. No evidence of insurability. Two-year suicide exclusion on all ported coverage from date of port Issuance. Surviving dependent spouse/child can port coverage. Once coverage is ported, if employee dies, dependents may continue ported coverage. III or injured persons can port coverage. Accelerated Death Benefit is allowed under ported coverage. Accidental Death and Dismemberment (AD&D) coverage not offered under portability. Conversion is available if parted coverage ends. Both plans provide similar premium waiver. ,Aetna's contract Is less restrictive around benefits payable if death occurs before waiver of premium is approved. However, The Hartford's ability to return to work for up to 5 days, refund of premium, and dependent continuation without premium are more favorable. Both carriers provide portability with various differences. The Hartford's portability will be provided. :�--�l-$+� [p$jc�+�ui��..Si.eps ,4j.1{NyyHS Gi{.n(fi�`y^2p�'1yti + kw,� �ppe� .� ,l4Y"Pe tiPry AD&D Exclusions — Includes an extensive list of AD&D exclusions beyond the following: war, self- inflicted injury, commission of or attempt to AD&D Exclusions — Standardly includes exclusion for war, self- inflicted Injury, commission of or attempt to commit a felony, sustained while taking Both have exclusions that tie to the AD&D benefits. The Hartford's contract is slightly more favorable in that It is less restrictive. 55A-23 commit a felony, sustained while taking drugs except as prescribed by a physician, while intoxicated and while on full-time, active duty in the armed forces. Coma Benefit — Full principle sum is paid over a 12-month period Third Degree Bum Benefit — Pays 100% of principle sum if 75% or more of your body is burned and pays between 50% of principle sum it 50% to 74% of body is burned. Repatriation of Mortal Remains — Will pay a benefit if outside a 200-mile radius from principle place of residence. Education Benefit — Dependent Childfren) Covers education level kindergarten to 12" grade and post high school Total Disability Benefit — Waives the 365-day covered loss period if - the accident left the person disabled and they die as a direct result of the injuries sustained in the accident. Delete If current contract does not include Traumatic Brain Injury Benefit — We will pay a traumatic brain injury benefit I you [or your dependent) suffer an accident that causes permanent brain damage that cannot be reversed. Exclusions — War Self-inflicted Injury Commission of or attempt to commit a criminal act Insurrectionrebellion, or taking part in a riot or civil commotion Motor vehicle accident caused by operating the vehicle while you are under the influence of alcohol. drugs except as prescribed by a physician, while intoxicated and while on full-time, active duty in the armed forces Coma Benefit — Percentage of the principle sum is paid per month until maximum reached. Critical Burn Benefit — When included, this benefit pays 5% of principle sum to a maximum of $5,000 if 25% of the body is burned and can only be connected through reconstructive surgery Repatriation of Mortal Remains — Will only pay a benefit if transporting across state lines or county borders. Education Benefit — Dependent Children) Only pays benefit for child education benefit post high school. No similar benefit option. No similar benefit option. Exclusions — The Hartford's standard exclusions are: War Self-inflicted Injury Commission of or attempt to commit a Felony Engaged in an illegal occupation If not under regular care of physician The Hartford's payment percentage is variable and same principle sum can be paid over time. The Hartford's Critical Bum Benefit is more limited. It pays a lesser amount and only applies H there is a need for reconstructive surgery: however, it does not require the higher percentage of burn to occur to receive a benefit. The Hartford's benefit is slightly better since the only requirement is crossing state or county lines versus an actual miles limit. The Hartford's Dependent Child(ren) education benefit limits benefit to post high school students only. The Hartford does not currently support this benefit feature. The Hartford does not currently support this benefit feature. Both contracts exclude certain high -risk conditions or activities. In addition, Aetna and The Hartford both require claimants to be under the regular care of a physician, this requirement is reflected in The Hartford's Exclusions and Aetna's benefit eligibility. 55A-24 Family Status Change (FSC) — Family Status Change (FSC) — The Hartford's contract places clarity and Not included Standardly Included parameter around what constitutes a Family Status Changes (FSC} and what changes in coverage are allow. Reinstatement — 24-month waiver for probationary period and 6-month waiver pre-existing condition exclusion. 'rest of Disability — 80% earnings test applies Reinstatement — It is The Hartford's practice to allow a 12- month waiver for probationary period and pre-existing condition exclusion. Test of Disability — No earnings test for first 12 months of disability payments. At The Hartford, If a covered employee loses coverage because they left employment and are rehired within 12 months of their termination date, the Eligibility Writing Period for coverage Is waived, and depending on the condition/timing, they receive partial credit toward any pre-existing condition insured period that they had already satisfied. The Hartford's benefit provides richer coverage for first 12 months. This Is a high-level comparison of your Aetna benefits against The Hartford's benefit availability: it may not reflect differences instate availability, is not aline by line comparison and may not reflect all of the differences between your Aetna contract and your Hartford contract, In making this comparison, The Hartford reviewed key benefit features contained In your Aetna policy to determine whether The Hartford policy forms can achieve substantially the same coverage or meaning as the Aetna prov, slon, although The Hartford language may differ. The Hadforde Is The Hartford Financial Services Group. Inc and its subsidiaries, including issuing company Hartford Life and Accident Insurance Company Home Office Is Hartford, CT. Copyright C 2018 by The Hartford. Confidential. All rights reserved. No part of this document may be reproduced, published or posted without the permission of The Hartford. Disability Form Series includes GBDA 000, GBD-1200, or stale equivalent. Life form Series includes GBD-1000, CBD-1100, or state equivalent. 7261a NS 10118 ® 2018 The Hartford Financial Services Group, Inc. All rights reserved. 55A-25 Welcome to The Hartford's Ability Advantage THE .4 HARTFORD The Hartford's Ability Advantage delivers industry -leading benefits and absence administration powered with state-of-the-art technology. Comprehensive reporting and analytic capabilities make sure you get the timely, accurate and accessible information that's critical to the performance of your benefit program. Before your coverage officially transitions to The Hartford on September 1, 2019, we will already be administering your Aetna coverage and claims. Note that on July 29, you and your employees will begin managing your Disability and/or Life and/or Leave benefits and plan administration through The Hartford's Ability Advantage self-service platform. What happens on July 29? • There will be no disruption in claims service during this transition. • Your benefits and policy details will be available on The Harford's Ability Advantage portal at https://abilityadvantage.thehartford.com. • Your log in process isn't changing. Use the same ID and password used with Aetna. • You will no longer use Aetna's site to manage your benefits or plan administration. • You and your employees will be automatically redirected from Aetnadisability.com to the Ability Advantage portal where there will be a reminder to use your same ID and password. STATE-OF-THE-ART CD Claims Management CAPABILITIES Comprehensive view into ca+m and leave event including real-time claim details and status Leave Management Dashboard to trac% absences. and stay e updated on static fedarai leave regulations ® S 00 Plan Administration � Tools and resources to manage your policy with The Hartford w Reporting Organized and synchronized information for real-time reporting at all levels of the organization V BIII Administration & Access Management Manage users at your company and easily set the level of permissions provided to each 55A-26 What do you need to know about user access for online benefits and/or absence administration and tracking? What's changing? All Users: • If you are logging into your account on Aetna's website or the mobile app, you will see a message with a link to The Hartford's Ability Advantage portal. • Aetna's website and mobile app are no longer available; however, The Hartford's Ability Advantage site has the same functionality and is fully mobile responsive - the portal can be accessed from a phone, tablet or computer. • You will be able to use your existing Aetna user ID and password to access Ability Advantage. • Once logged in, you will be able to: o View both active and historical claims, and o View copies of letters, forms, emails and payments issued by Aetna and to see any subsequent claim activity administered by The Hartford after the transition. • Additionally, you can upload documents directly into The Hartford's Ability Advantage portal by using your web browser functions and/or using the camera upload features. Employers: • If you have responsibilities to pay The Hartford invoices and/or perform plan administration activities, you will now have easy access to those functions on The Hartford's online portal. • If you have systems administration permissions, you will now see the WEST Administration tool name changed to "Manage User Access." • If you have systems administration permissions, you will now see a new set of roles and permissions for billing and participant administration. c For improved security and privacy, only users with role -based permissions will be able to access and view the medical underwriting status of employees. • You will see improved navigation between your Supervisor dashboard and your own personal claim information. • You will have access to policy forms and flyers provided by The Hartford. • If you have life coverage transitioning, note that any life claim in progress on Aetna's Employee Secure Website needs to be submitted before your policy transition date --September 1, 2019—to ensure the claim is processed. Employees: • Claimants will have a new option to inquire about their claims, payments or any other topic with online chat support. • Employees can now view medical underwriting status, along with a copy of the decision letter. User guides with more details specific to employers and employees will be available on the Ability Advantage site. i, How to File a Claim videos will be available to all users under the Quick Links -Take A Tour section on the landing page of Ability Advantage. The Hartford® is The Hartford Financial Services Group, Inc. and its subsidiaries, including underwriting companies Hartford Life and Accident Insurance Company and Hartford Fire Insurance Company. Home Office is Hartford, CT. The Hartford is the administrator for certain group benefits business written by Aetna Life Insurance Company and Talcott Resolution Life Insurance Company (formerly known as Hartford Life Insurance Company). © 2019 The Hartford 7236g NS 07/19 55A-27 EXHIBIT 2 7 of Hartford Life and Accident Insurance Company City of Santa Ana Basic Life and AD&D Insurance Supplemental Life and AD&D Insurance Long Term Disability Insurance Renewal Date January 1, 2020 The information contained herein is intended for the sole use of the Policyholder and Broker(s) of Record. Any other use is prohibited. THE wl HARTFORD Table of Contents Introduction Basic Life Insurance Premium Summary Supplemental Life Insurance Premium Summary Long Term Disability Insurance Premium Summary Aggregate Summary for All Lines Appendix THE .4 HARTFORD Introduction Thank you for trusting us to help protect one of your company's greatest assets — your employees Our rich 200-year history of helping our customers prepare, protect and prevail, combined with our expertise in delivering Group Benefits, allows us to create solutions that honor our relationships and make good on our promises We have completed a review of your current coverage. We appreciate your business and are pleased to offer the following renewal information for your consideration. This review provides important information about the performance and administration of your employee benefits program from The Hartford. We believe that you deserve the information necessary to make informed decisions about the benefit protection you offer your employees. All benefits are subject to the terms and conditions of the policy. Policies underwritten by the issuing companies listed above detail exclusions, limitations, reduction of benefits and terms under which the policies may be continued in force or discontinued. This material explains the general purpose of the insurance described, but in no way changes or affects the policy as actually issued. In the event of a discrepancy between this document and the policy, the terms of the policy apply. Complete details are in the Certificate of Insurance issued to each insured individual and the Master Policy as issued to the policyholder. Benefits are subject to state availability. In addition to this document, your Account Manager is ready to assist you Pl er,I 55A-30 ; ,1 THE HARTFORD Premium Summary Basic Life Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium Basic ADD 965 $45,221,000 Rates per $1,000 2 Years N/A $4,613 Rate(s) Current Rate Renewal 0.102 0.102 Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium 965 $45,221,000 Rates per $1,000 2 Years N/A $904 Rate(s) Current Rate Renewal 0.020 0.020 4 55A-31 Supplemental Life Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium Rate(s) Age Band < 25 25 - 29 30-34 35 - 39 40 - 44 45-49 50 - 54 55 - 59 60 - 64 65 - 69 70 - 74 75 + 283 $79,085,000 Rates per $1,000 2 Years Traditional $20.001 Current Rate Renewal 0.055 0.055 0.055 0.055 0.083 0.083 0.110 0.110 0.166 0.166 0.294 0.294 0.552 0.552 0.672 0.672 1.095 1.095 1.978 1.978 1.978 1.978 1.978 1.978 THE HARTFORD 55A-32 5 �P H"S CFORD Supplemental Dependent Life Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium TBD Rates per $1,000 See Below Traditional TBD Rate(s) Current Rate Renewal 2020 Renewal 2021 Child Rate 0.100 0.100 Age Band < 25 25 - 29 30 - 34 35 - 39 40 - 44 45 - 49 50 - 54 55 - 59 60 - 64 65 - 69 70 - 74 75 + Supplemental ADD Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium 0.10 0.10 0.055 0.10 0.10 0.055 0.10 0.10 0.083 0.10 0.10 0.110 0.10 0.10 0.166 0.10 0.10 0294 0.10 0.10 0.552 0.10 0.10 0.672 0.10 0.10 1.095 0.10 0.10 1.978 0.10 0.10 1.978 0.10 0.10 1.978 283 $79,085,000 Rates per $1,000 2 Years Traditional $2,373 Rate(s) Current Rate Renewal 0.030 0.030 6 A'` 55A-33 Life Option: Basic Life Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium Rate(s) CASA, SEIU, PTSC 965 $55,449,000 Rates per $1,000 2 Years N/A $5,656 0.102 City Manager CS, Council Members, All Others Executive Management Middle and Administrative Management Police Officers Association Basic ADD Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium Rate(s) Flat $50,000 Flat $500,000 Flat $20,000 3x BAE to $300,000 2x BAE to $30,0000 Flat $30,000 965 $55,449,000 Rates per $1,000 2 Years N/A $1,109 0.02 THE .4 HARTFORD Prer�`55A-34 , — LTD Premium Summary Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium Rate(s) Executives Core Buy Up 489 $1,388,417 Rates per $100 Covered Salary 2 Years Traditional $5,575 Current Rate 0.352 8.78 PEPM 15.93 PEPM Renewal 0.352 8.78 PEPM 15.93 PEPM ri THE HARTFORD a 55A-35 THE HARTFORD LTD Options: LTD Premium Summary Executive Management 66.67% to $10,000 City Manager 66.67% to $10,000 SAMA 66.67% to $10,000 CASA 66.67% to $7,500 PMA 66.67% to $7,500 Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium 106 $988,852 Rates per $100 Covered Salary 2 Years N/A $3,649 Rate 0.369 LTD Premium Summary SEIU: 50% to $5,000 60 day EP PTCS: 50% to $5,000 60 day EP Enrolled Lives Volume Rate Basis Rate Guarantee Proposed Enrollment Type Monthly Renewal Premium 383 $2,365,404 Rates per $100 Covered Salary 2 Years N/A $4,352 Rate 0.184 9 THE Yf. HARTFORD �cs 10 THE HARTFORD Aggregate Summary for All Lines Inforce Monthly Premium Renewal Premium Change Basic Employee Life $4,613 $4,613 0% Basic ADD $904 $904 0% Supplemental Employee Life $20,001 $20,001 0% Supplemental ADD $2,373 $2,373 0% Long Term Disability $5,575 $5,575 0% Total $33,466 $33,466 0% With this rate structure the employer may be electing to partially support employer paid coverages with the rate for the employee paid coverages. This means that premiums paid for one coverage may cover the cost of another coverage under the Plan. When we quote rates with such partial support between the employee paid and employer paid coverages we do so with the understanding that the employer and employee coverages are part of a single ERISA plan sponsored by the employer and that the employer has determined that the rate structure is consistent with information provided to employees and with its ERISA obligations. For those cases that are not governed by ERISA, we are quoting the rates with the understanding that the employer has determined the rate structure is consistent with the information provided to employees. If our understanding is not accurate, please contact us. r r R' 55A-38 ; ,' " THE I HARTFORD Definition of Underwriting Terms Claims Count A/E: In order to analyze the adequacy of the current rate structure, a subset of The Hartford's insured groups are reviewed that share similar demographic and industry characteristics with your company. The review establishes an expectation of claim incidence for your industry and demographic mix. The Claim Count A/E (Actual Claims versus Expected Claims) reflected in your experience is evaluated against The Hartford's expectations. Life Claim Count A/E: (Life Claims + (Premium Waiver Claims x 0.5 x Total Exposure Years - (Total Exposure Years — 0.5)) LTD Claim Count A/E: Total Claims Expected Number of Claims Formula Rate: The Formula Rate is a weighted blend of the Pure Manual Rate and the Manual rate adjusted for the Claim Count A/E. The two rates are blended together using a Credibility percentage. • Manual Rate is calculated based on your employees' demographic profile, plan design, industry and volume of coverage. • Credibility is the extent to which The Hartford believes prior results will predict future results. Credibility is calculated based on the number of lives covered and the number of years in the experience period. Formula Rate: (Manual Rate x Claim Count A/E x Credibility) + (Manual Rate x (1-Credibility)) Life Experience Analysis: In order to analyze the adequacy of the current rate structure, all Premiums received during the analysis period are adjusted to the current rate level, shown as "Constant Premium". The "Constant Premium" is then compared to Incurred Claims which is comprised of: Paid Claims, Premium Waiver Reserves, charges for Living Benefits Option and Portability, Statutory Interest, and Incurred but not Reported Reserves (reserves established for claims incurred during the time period that have not been reported). Experience Rate: The Experience Rate is calculated based upon prior Premium and Incurred Claims experience. The Permissible Loss Ratio is the percent of Premium The Hartford can allocate to Incurred Claims which allows us to recover expenses associated with administering your benefit program. These expenses contemplate claims activity, account structure complexity, and regularly - updated expense factors. Because expense components fluctuate from year to year, the Permissible Loss Ratio reported for each renewal will subsequently fluctuate. Experience Rate: (Incurred Loss Ratio / Permissible Loss Ratio) x (Current Rate) 12 -55A-39' ail. R THE HARTFORD LTD Experience Analysis: In order to analyze the adequacy of the current rate structure, all premiums received during the analysis period are adjusted to the current rate level, shown above as "Constant Premium". The "Constant Premium" is then compared to total Incurred Claims, which include Disabled Life Reserves and actual benefit payments. LTD Incurred Claims: The incurred claims reflect the actual claims paid to date plus a high confidence estimate of future claims that will be paid. That estimate is based on claimant -specific data (such as age, gender and cause of disability) and experience assumptions (such as interest rates, claim termination rates and social security approval rates). STD Experience Analysis: In order to more accurately project the cost of this program using historical results, the incurred claim amounts are compared to the premium generated by the current rate level , shown above as "Constant Premium". STD Incurred Claims: The Incurred claim amounts are inclusive of paid claims plus reserves that are established for claims that were incurred during the experience period, however paid in the subsequent period. STD Experience Rate: (Net Loss Ratio / Permissible Loss Ratio) x Current Rate The Hartford® is The Hartford Financial Services Group, Inc. and its subsidiaries, including issuing companies Hartford Life Insurance Company and Hartford Life and Accident Insurance Company. Home Office is Hartford, CT. This proposal includes a quote(s) for one or more products, which are issued on the following forms: Accident Form Series includes GBD-2000, GBD-2300, or state equivalent. Accidental Death and Dismemberment Form Series for all states except PR, WA and CA includes GBD-1000 and GBD-1300, or state equivalent, and in PR, WA and CA Form 7582 and Form PA-5427, or state equivalent. Critical Illness Form Series includes GBD-2600, GBD-2700, or state equivalent. Disability Form Series includes GBD-1000, GBD- 1200, or state equivalent. Life Form Series includes GBD-1000, GBD-1100, Z-PORT, or state equivalent. Hospital Indemnity Form Series includes GBD-2800, GBD-2900, or state equivalent. �r tj� 13 Prepars J/`1i- Arevail.