DATE: November 29, 2002
TO: Compensation Managers
Heads of Human Resources
Heads of Human Resources of Participating Separate Employers
Heads of Bargaining Agents
SUBJECT: Premium Rate Increase Effective January 2003 for the Disability Insurance (DI) Plan The DI plan is a group insurance plan that provides
income protection to employees who are represented in the collective bargaining process when they are unable to work for a lengthy period of time due to a totally
disabling illness or injury.
DI Premium Rate Increase Effective January 2003, plan members will note that the DI premium has increased from $1.08 to $1.61 per $1000 of adjusted
annual salary. This increase is required because of a greater number of beneficiaries and general increases in costs.
Premium cost-sharing arrangements will not change. Employees will pay 15% of the premium ($0.2415 per $1000 of adjusted insured salary) and the employer will contribute
85% ($1.3685).
This is the first change in premium rate since 1993.
Example
An employee earning $46,315 a year would have an insured salary of $46,500. This represents the employee's insured salary adjusted to the next highest multiple of
$250.
The monthly premium for DI coverage for 2003 will be calculated as follows:
| $1.61 x $46,500 ÷ $1000 = $74.87 |
| Employee pays |
$11.23 |
| Employer pays |
$63.64 |
| Total |
$74.87 |
Employees with questions about their coverage should contact their departmental pay and benefits specialist.
Participating employers with their own pay facilities are required to ensure that premiums remitted to Sun Life for 2003 are in accordance with the new rate.
Chiefs of Compensation at the corporate level may contact the Treasury Board if additional information is required.
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