SR-602-008
F:\PERSON\MISC\COUNCIL\STAFFRPT\COUNCIL54 Santa Monica, California
November 27, 2001
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Agreement with the Hartford Life Insurance Company for Life Insurance and
Long Term Disability Insurance Coverage for City Employees
INTRODUCTION
This report recommends that the City Council authorize the City Manager to negotiate and
execute a contract with the Hartford Life Insurance Company to provide life insurance and
long-term disability insurance coverage for City employees.
BACKGROUND
The Human Resources Department currently contracts with Reliance Standard Life
Insurance Company for life insurance coverage and UNUM Provident Corporation for long-
term disability coverage for City employees. AON Consulting, the City?s employee
benefits consultant, requested proposals from potential vendors for group life insurance
and long-term disability insurance coverage for City employees for the 2002 plan year.
The specifications for the proposals were that the same level of benefits be provided. The
Hartford Life Insurance Company submitted a proposal for both insurance plans (life and
long term disability) that would result in a savings of $55,000 per year, while still providing
the same benefits as the current plans. In addition, the Hartford Life Insurance Company
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has guaranteed the rates for three years, which will result in a total savings of $165,000
over the next three calendar years (2002, 2003 and 2004).
BUDGET/FINANCIAL IMPACT
The estimated annual premiums for the Hartford Life Insurance Company for life insurance
coverage and long-term disability insurance are $615,000 per year. Sufficient funds have
been included in the FY2001-2002 budget to cover this cost.
RECOMMENDATION
It is recommended that the City Council authorize the City Manager to negotiate and
execute a contract with the Hartford Life Insurance Company to provide life insurance and
long-term disability insurance coverage for City employees in an amount not to exceed
$615,000 per year.
Prepared by: Karen Bancroft, Director of Human Resources
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