Page 50 - 2019 - erbe employee handbook.draft national

9-7. Voluntary Life Insurance
Erbe offers each employee the ability to purchase supplemental life insurance over and above the basic life policies provided. The maximum coverage amounts are listed below. The amount of coverage for the spouse cannot exceed 50% of the elected employee coverage while the coverage for children cannot exceed 10%.
 Employee  Spouse
 Children
Guaranteed Issue
$500,000 $250,000 $10,000
Employees are guaranteed issue of $50,000 of coverage without evidence of insurability while spouses are guaranteed $10,000. Amounts that exceed the guaranteed issue are subject to a medical questionnaire and underwriting. Underwriting decisions are solely the responsibility and decision of the insurance carrier.
9-8. Disability Coverage
Erbe offers long- and short-term disability coverages to all full-time employees. Each plan includes base salary, commissions, and bonuses in calculating maximum benefit amounts.
Short-Term Disability
Erbe provides eligible employees a Short-Term Disability plan. After a 14-day elimination period, the plan provides income replacement of 60% of pre-disability earnings subject to normal withholding.
Long-Term Disability
Erbe offers eligible employees a Long-Term Disability (LTD) base plan. After a 90-day elimination period, the plan provides for monthly LTD benefits of 60% of the applicable gross pre-disability earnings up to a maximum benefit as described in the SPD.
After-Tax Provision
The monthly proceeds of the long-term disability benefit are received on a tax-free basis. Erbe deducts the premium for this benefit on an after-tax basis but provides an income amount equal to 1.3 times the premium to cover the premium and taxes associated with the income provision. By paying the taxes on the premium, the employee is allowed to receive tax-free LTD income.
9-9. Flexible Spending Accounts
Flexible Spending Accounts (FSAs) are designed to pay for qualified health and dependent care expenses with pre-tax dollars that employees elect to deduct from their pay. Employees don not have to be enrolled in any of the health plans offered by Erbe to participate.
Similar to any pre-tax benefit, federal tax law imposes limits on the employee’s ability to change flexible benefit elections during a plan year. For this reason, employees should consider elections carefully.
50 | Company Benefit Programs Confidential/Internal Use Only