Term Life Insurance
Life Insurance Administered by Securian
Purdue University provides term coverage for employees with the option to increase your coverage.
When making decisions for your life insurance coverage, visit the Purdue University Securian webpage to get information on
- Purdue University Plan Summaries
- Resources for term life, AD&D and Evidence of insurability process
- Educational videos
- Life insurance options after retirement
- Financial Planning tools
- Additional benefits included with Securian
- Benefit Scout – an educational tool designed to help you understand and make decisions about your life insurance benefits. Based on information you provide, it will help you calculate how much life insurance is enough and estimate costs. If you would like your results, you will be able to download a copy of your life insurance summary.
Administered by Securian.
While employed at Purdue, you are covered by term life insurance. The amount of coverage varies, depending on your age and the option you select. Benefits are paid to your beneficiary in the event of your death from any cause.
If you have no additional term life enrollment or beneficiary designation on file with Benefits at the time of your death, benefits equal to one and a half times your annual salary will be payable to your survivors as described in the Purdue Basic Term Life Certificate. This insurance has no paid-up or cash values and remains in force only while you are employed at the University (unless you choose to continue coverage after your leave, as explained in the "Coverage portability" and "Conversion privilege" section below).
The University provides you with an amount of term life insurance equal to one and a half times your annual budgeted salary, rounded to the nearest $1,000. For 10-month staff, summer earnings are included, once the summer session ends.
Basic employee term life
- One and a half times annual budgeted salary
- Not to exceed $500,000
- You may choose to limit this employer-paid coverage to $50,000 for imputed income purposes.
Options offering coverage greater than one and a half times your annual budgeted salary and coverage for your dependents, are available to you to purchase via payroll deduction. To determine how much additional coverage is available to you, and your cost for this increased insurance, check the information that follows.
Additional employee term life options
- You may elect one to eight times your annual salary (this is in addition to the coverage provided by Purdue)
- Not to exceed $2,000,000
- Without providing Evidence of Insurability (EOI), you may elect an even salary multiple of coverage that does not exceed three times your annual salary or $500,000, if you elect coverage during this initial eligibility period (31 days from hire)
The rates for additional employee term life coverage are also based on tobacco use. You may enroll for coverage at non-tobacco rates, provided you have not used tobacco in any form during the past 12 months and are not currently using tobacco in any form.
Rates for additional employee term life coverage
Age .......... Tobacco Rate/$1,000/Month ........... Non-Tobacco Rate/$1,000/Month
Under 30 ...............$0.048 .................................................$0.027
30-34 .....................0.066 ..................................................0.037
35-39 .....................0.074 ..................................................0.041
40-44 .....................0.084 ..................................................0.042
45-49 .....................0.135 ..................................................0.067
50-54 .....................0.222 ..................................................0.100
55-59 .....................0.406 ..................................................0.185
60-64 .....................0.548 ..................................................0.297
65-69 .....................1.053 ..................................................0.572
70 & over ................1.508 ..................................................0.962
What is Evidence of Insurability?
Evidence of Insurability (EOI) is required for coverage greater than that outlined above and/or coverage elected after this initial eligibility period. EOI is the underwriting medical review process used to determine an applicant's insurability under this plan, for coverage that is not guaranteed issue.
In these instances, a letter will be mailed to the applicant providing directions for answering health questions online. A paper form will also be included, for use by those who do not have access to a computer.
After the initial underwriting review, many applicants are approved or declined without the need for any additional information. In general, most of the applications Securian receives are completed without asking for further information. However, additional information is sometimes required to get a better understanding of an applicant's health. Additional information may include an applicant questionnaire, historical medical records, or a paramedical exam.
Reductions in coverage
Your basic University-provided insurance does not reduce with age; however, your amount of additional employee term life reduces at the following ages:
- Age 65 — reduces to 65 percent of original coverage amount
- Age 70 — reduces to 50 percent of original coverage amount
- Age 75 — reduces to 25 percent of original coverage amount
More detail
University-provided insurance is effective with your first day at work. Coverage you elect that is guaranteed, as outlined above, is effective upon receipt of your enrollment form. Coverage requiring EOI is effective upon approval by Securian.
At any time after your initial enrollment, you may request to have the amount of your term life insurance increased or decreased. If you want to reduce the amount of insurance, the request will be effective immediately. If you want to increase coverage after your initial enrollment period has ended, and you do not have a qualifying change in family status, EOI will be required. Securian will determine whether you can increase your coverage or not; however, you cannot be declined for coverage that is already in effect.
If you have a qualifying life event or change in family status (CIFS), you may increase your term life amount one salary multiple without EOI. The level increase must match your CIFS reason. To increase more than one salary multiple, EOI is required.
Coverage portability
If you leave University employment, you may be eligible to take term life coverage with you and continue to pay premiums until age 70. This election must be made within 31 days of the date your coverage would otherwise terminate, and does not require EOI.
You will pay Securian directly for this coverage. It's important to note that the premium rate on your portable policy will be higher than the rate you paid for coverage as an active employee. Below are the portability rates currently in effect.
Current portability rates (subject to change as determined by Securian)
Age Rate ..............$1,000/month
Under 30 ..............$0.10
30 – 34 .................0.14
35 – 39 .................0.15
40 – 44 .................0.17
45 – 49 .................0.25
50 – 54 .................0.39
55 – 59 .................0.72
60 – 64 .................1.11
65 – 69 .................2.14
There are no non-tobacco rates for portable life insurance.
Conversion privilege
Any term life coverage you do not have the option to continue under the portability option may be converted to an individual policy under the conversion option. Ported coverage that terminates at age 70 may also be converted. This is coverage you can retain for the rest of your life. This election must be made within 31 days of the date your coverage would otherwise terminate, and does not require EOI.
You will pay Securian directly for this coverage. It is important to note that premiums are higher than those paid as an active employee and under the portability feature, and may be higher than rates you might obtain by providing EOI through a direct insurance agent. Contact Securian for information about the current rates for conversion.
The 31-day conversion privilege also applies to the reduction in term life coverage that occurs at ages 60, 65, and 70 while you are still working. If you die within 31 days of the date your coverage is reduced, the amount of coverage you carried before the reduction will be paid as the benefit.
If you are interested in the portability or conversion options, contact Securian within 31 days of the date your coverage with the University ends or reduces.
Imputed income
Current tax law requires that the “imputed value” of any group term life insurance provided for you by your employer above $50,000 be reported on your W-2 form as taxable income. If you wish to avoid receiving employer-paid coverage in excess of $50,000, you may request during enrollment that your University-paid benefit be limited to $50,000.
Imputed income only applies to Basic Term coverage above $50,000. It does not apply to any amount you elect for Additional Term Life coverage.
If you elect to limit your benefit and later wish to increase your life insurance amount, you will need to provide Evidence of Insurability as required by Securian.
The imputed income rates below are subject to change.
Age ....................... Monthly Rate Per $1,000
Under 25----------------------- $0.05
25-29---------------------------- .06
30-34---------------------------- .08
35-39---------------------------- .09
40-44---------------------------- .10
45-49---------------------------- .15
50-54---------------------------- .23
55-59---------------------------- .43
60-64---------------------------- .66
65-69--------------------------- 1.27
70 and above---------------- 2.06
An example
A 56-year-old employee, who is a non-tobacco user, earns $50,000 a year. The University provides the employee with basic term life insurance equal to 1.5 X salary, or $75,000.
This means the employee will incur imputed income on $25,000. How much tax will the employee owe due to imputed income?
Multiply 25 by the monthly imputed income rate for the employee's age (see chart above):
25 x .43 = $10.75/ month of imputed income, or $129/year.
If the employee is in the 28 percent tax bracket, the employee will pay $36.12 in additional tax for the year.
$129 x .28 = $36.12
Other Plan features
Accelerated or living benefit
Purdue's term life insurance plan offers an accelerated benefit (sometimes called a living benefit) that allows terminally-ill people to tap into their life insurance proceeds while they are still living. Often the money is used to handle out-of-pocket medical expenses, but it may be used for any purpose.
To qualify for the accelerated benefit, you must furnish proof to Securian that your life expectancy is 12 months or less. A doctor's certification will be required.
The accelerated benefit equals one-half the amount of the insurance in effect or $250,000, whichever is less.
Any amount received as an accelerated benefit is deducted from benefits paid to your beneficiary when you die.
Specialized Assistance
Additional services
The following basic services are automatically included as part of your University-provided basic term insurance.
Beneficiary financial counseling
Beneficiaries may take advantage of independent financial counseling services from PricewaterhouseCoopers LLP.
Ceridian LifeWorks provides telephone access to a national network of attorneys for consultation on various legal issues, including simple wills. For more information, call 877-849-6034.
Emergency travel assistance and travel information services are provided by Redpoint WTP LLP. For more information, call 1-855-516-5433.
Identity theft resolution services are available to guide you through the identity recovery process. Services are provided by Europ Assistance USA. For more information, call 866-893-8508.
Resources:
- Purdue Basic Term Life Certificate (Includes Repatriation Certificate Supplement)
- Purdue Additional Term Life Certificate
- Check or change beneficiaries through Benefitfocus
- Securian Customer Service: 866-293-6047
- Life/Voluntary Benefits
- Accidental Death and Dismemberment
- Term Life Insurance
- Term Life Insurance on Spouse and Children
- Accident Insurance
- Auto and Home Insurance
- Critical Illness Insurance
- Pet Insurance
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- Long Term Care Insurance
- Supplemental Hospital Insurance
- Universal Life Insurance