Notice Requirements from Group Life Conversion to Individual Life

[Guest EMC]

Where an employer provides group life insurance coverage with a conversion option (to an individual policy) upon termination, is there a MANDATED notice that the employer must give to the employees at termination regarding the conversion option, or, is notice of the conversion option sufficient if put in the certificate of coverage provided to the employees when they first become eligible for the Group Life coverage? If there is a mandated notice, what is the authority for such notice? Thanks

[This message has been edited by EMC (edited 01-07-2000).]

[Guest M. Johnston]

Where I used to work, I believe the conversion notification clause (who is responsible for doing what...) was spelled out in the insurance contract, not the summary plan description booklet. The SPD only described the availability of conversion. The insurance carrier sent us the supply of conversion forms and those would be sent out to terminated employees, usually with their COBRA letter, if applicable. I don't think the conversion form is anything that can be put in the SPD, because it usually requires the employer to complete detailed information regarding the employee's terminated status, such as term. date, volume of coverage, and employer signature as verification.

[KIP KRAUS]

EMC:

I believe that any requirement to provide a life insurance conversion notice to a terminating employee is a requirement by state insurance law. However, we have always included the conversion notice in the SPD. In addition, we remind a terminating employee of this right in the a letter that describes what happens to all benifits at termination.

I would check the group insurance laws in the state or commonwealth where the policy is issued.

[Guest kclark]

As well as being stated in our Life Insurance SPD, we had our COBRA Administrator (TPA) add a paragraph in the COBRA letter informing terminating employees of the conversion option and where to obtain conversion forms.