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Life Insurance at a Glance
Life Insurance Under the Supplementary Death Benefit Plan
http://www.tbs-sct.gc.ca/pubs_pol/hrpubs/Pensions/ypp1-eng.asp
As a member of the Public Service Pension Plan (Public Service Superannuation Act), you have life insurance coverage under the Supplementary Death Benefit Plan. This plan provides participants with life insurance equal to twice their annual salaries. Full information on this Plan is found in the brochure Your Pension Plan.
Life Insurance Under the Public Service Management Insurance Plan (PSMIP)
http://www.tbs-sct.gc.ca/pubs_pol/hrpubs/TB_863/psmippolicy-eng.asp
For employees in managerial or confidential positions and others who are members of certain designated groups.
- What is my Public Service Management Insurance Plan (PSMIP)?
- What is covered under the Public Service Management Insurance Plan?
- Insurance for Main Plan Members
- Insurance for the Executive Group
- How much do I pay for my Public Service Management Insurance Plan?
- How do I know if I have life insurance coverage under the PSMIP?
- Who can I cover as a dependant?
- How do I name a Beneficiary under the PSMIP?
- What happens to my PSMIP coverage when I go on Leave Without Pay?
- What happens to my coverage when I retire or otherwise leave the Public Service?
- Am I covered under the PSMIP if I am posted outside Canada by my employer?
What is my Public Service Management Insurance Plan (PSMIP)?
The Public Service Management Insurance Plan (PSMIP) provides group life insurance, accidental death and dismemberment insurance, dependants' insurance and long-term disability insurance to Public Service employees employed in managerial or confidential positions and others who are members of certain designated groups. Coverage is extended to full time employees and part time employees working more than 1/3 of the normal work week, as long as they are appointed for a term of more than 6 months. If you are a member of a Public Service union, you are not normally eligible for life insurance coverage under PSMIP. An exception is made for persons who had coverage under PSMIP before becoming represented by a bargaining agent and who remained continuously employed since that time.
Complete terms and conditions of your Public Service Management Insurance Plan are set out in the contract of insurance between the PSMIP Board of Trustees and the Industrial Alliance Insurance and Financial Services Inc Company of Canada.
General information on the major benefit provisions of the Plan is found in one of two employee booklets:
- If you are a member of the Executive Group, or of another group of employees eligible to receive the Executive Group package of insurance benefits, you should refer to the booklet The Public Service Management Insurance Plan -- Executive Booklet.
- Other Plan members, referred to as Main Plan members, should consult The Public Service Management Insurance Plan -- Main Plan Booklet.
Plan members who do not have access to the Internet, should contact their departmental compensation advisor.
What is covered under the Public Service Management Insurance Plan?
Insurance lines under the PSMIP can differ for Public Service employees, depending on whether they are members of the Main Plan or the Executive Group. Refer to the heading below which applies to you.
Insurance for Main Plan Members
The Public Service Management Insurance Plan provides four kinds of optional insurance for which you can apply:
- Basic life insurance -- a lump sum benefit roughly equal to your annual salary, payable to your beneficiary in the event of your death from any cause;
- Supplementary life insurance -- an additional layer of insurance equal to the amount of your basic life insurance;
- Accidental death and dismemberment (AD&D) insurance -- a lump-sum benefit payable to your beneficiary if you are killed in an accident (on or off the job), or to you directly, if you are maimed in an accident. Refer to The Public Service Management Insurance Plan - Main Plan Booklet for details on how this insurance works;
- Dependants insurance -- a lump sum benefit payable to you in the event of the death or dismemberment of your spouse or your eligible dependant(s). See The Public Service Management Insurance Plan - Main Plan Booklet for the amounts of insurance for dependants.
IMPORTANT:
- Coverage under Basic Life and Supplementary Life decreases by 10 % per year beginning at age 61, but will never be less than 10 % of salary as long as you remain a member of the Plan.
- An application for supplementary life insurance must always be accompanied by evidence of insurability.
- There are time limits for application for basic life insurance and dependants' insurance without the need to provide evidence of insurability satisfactory to the insurer. Refer to the booklet cited above for details.
Insurance for the Executive Group:
As a member of the Executive Group, or of another group eligible for the Executive Group package of insurance benefits, you are automatically covered for the three kinds of insurance which are fully Employer paid:
- Basic Life Insurance -- a lump sum benefit equal to approximately twice your annual salary, payable to your beneficiary in the event of your death from any cause;
- Accidental Death and Dismemberment (AD&D) Insurance -- a lump-sum benefit payable to your beneficiary if you are killed in an accident (on or off the job) or to you directly if you are maimed in an accident. Refer to the booklet The Public Service Management Insurance Plan - Executive Booklet for details on how this insurance works;
- Dependants' Insurance -- a lump sum benefit payable to you in the event of death or dismemberment of one or more of your dependants. See the booklet The Public Service Management Insurance Plan - Executive Booklet for the amounts of insurance for dependants.
Supplementary Life Insurance is also available to Executives on an employee-paid optional basis. You may apply for Supplementary Life insurance, which is an additional layer of insurance equal to your salary, at any time while you are a member of PSMIP. Choosing this option would bring your total life insurance coverage under the Plan to approximately three times your salary. Evidence of your insurability satisfactory to the Insurer is required no matter when you apply.
The amount of your supplementary life insurance decreases by 10% per year beginning at age 61. Coverage will never be less than 10% of salary as long as you remain a member of the plan.
Executives who choose supplementary life insurance must pay the appropriate premiums, based on their age and sex. Your compensation advisor will advise you of the amount of the premiums for supplementary life.
How much do I pay for my Public Service Management Insurance Plan?
As a main plan member, you will pay premiums for your insurance based on your salary, age and sex and the number of units of AD&D insurance selected, if any. Your compensation advisor will advise you of the premiums.
As an executive, your employer pays the full cost of your basic life, accidental death and dismemberment and dependant's insurance. The employer's contribution towards your PSMIP coverage is a taxable benefit. If you live in the Province of Quebec, all premiums paid by your employer with the exception of LTD is a taxable benefit.
How do I know if I have life insurance coverage under the PSMIP?
If you are in doubt about your coverage, contact your compensation advisor.
Plan members receive a Certificate of Insurance showing that they are members of PSMIP and the coverage in place.
Who can I cover as a dependant?
As a plan member, you can apply for life insurance and AD&D insurance coverage for the person to whom you are legally married. ernatively, you may apply for coverage for the person with whom you have lived for a continuous period of at least one year and with whom you continue to live in a conjugal relationship.
You may apply for coverage for your dependant child(ren) or the dependant child(ren) of your spouse or common law partner. To be eligible as a dependant child, the person must be unmarried, not employed on a regular, full-time basis and dependant on you for support and either under the age of 21 OR under the age of 25 and a full time student.
IMPORTANT: Evidence of insurability will be required if you do not apply for dependants' insurance within certain time limits. See the booklet The Public Service Management Insurance Plan - Main Plan Booklet for details.
How do I name a Beneficiary under the PSMIP?
Your compensation advisor will provide you with the form designed for this purpose.
It is a good idea from time to time to review your designated beneficiaries under all your benefit plans.
What happens to my PSMIP coverage when I go on Leave Without Pay?
Generally speaking, you can continue to be covered under the PSMIP. If you are paying premiums for your coverage, you must continue to pay these directly to the Insurer during your period of leave. Failure to pay the premiums will result in loss of coverage. If you become totally disabled, you can request a waiver of premium.
Before proceeding on leave, you should discuss continuing your coverage with your compensation advisor.
Employer-paid coverage for Executives continues automatically during a period of LWOP.
What happens to my coverage when I retire or otherwise leave the Public Service?
When you leave the Public Service, your PSMIP coverage and that of your dependants will cease, subject to a 31 day extension period. During that period, you can apply for an individual, private life insurance policy from National Life WITHOUT MEDICAL EXAMINATION AND REGARDLESS OF THE STATE OF YOUR HEALTH. You can convert a minimum of $10,000 and up to a maximum of your coverage while employed. For plan members over the age of 65, there is a limit of $200,000 on the amount that can be converted to an individual life insurance policy. Refer to the booklet The Public Service Management Insurance Plan -- Main Plan Booklet for details.
Members of the Executive Plan should refer to the booklet The Public Service Management Insurance Plan -- Executive Booklet for details on converting their PSMIP benefits to private policies. This booklet also describes a post-retirement life insurance benefit available for members of the Executive Plan who retire and begin receiving an immediate continuing pension under the Public Service Pension Plan (Public Service Superannuation Act).
Am I covered under the PSMIP if I am posted outside Canada by my employer?
Yes.
Member of the PSMIP
The PSMIP applies to the following employees:
- Employees in managerial or confidential positions
- Employees in the Organizational and Methods Group, the Leadership Programs and the Personnel Administration Group
- Governor in Council appointees
- Minister's Exempt Staff
If you are in doubt about whether you are a member of the PSMIP, consult your Compensation Advisor.
