VRS Handbook for Members - Virginia Retirement System

13
Insurance
in Retirement
Group Life Insurance • Retiree Health Insurance
(State Employees) • Health Insurance Credit • Long-Term
Care Coverage
Group Life Insurance
Basic Group Life Insurance Coverage
If you are covered under the VRS Group Life Insurance Program, some basic
group life insurance benefits will continue into retirement or if you are eligible
to retire but defer retirement. Your coverage will end if you have not met the age
and service requirements for retirement or you take a refund of your member
contributions and interest.
Benefits include:
• Death benefit equal to your compensation at retirement, rounded to the next
highest thousand and then doubled. If you retire with 20 or more years of
service credit, the death benefit will be based on your highest compensation
as a covered employee, even if your salary at retirement is lower. The benefit is
payable if you die of natural or accidental causes.
• Accelerated death benefit option. If you are diagnosed with a terminal
condition and have fewer than 12 months to live, you can withdraw some or
all of your life insurance proceeds to use for any purpose. Your beneficiary
or survivor will receive any remaining amount upon your death.
The provisions that allow for double the natural death benefit for accidental death
and dismemberment end upon retirement.
Life insurance coverage reduction. Your basic group life insurance coverage will
begin to reduce by 25 percent on the January 1 following one calendar year
of retirement. It will continue to reduce by 25 percent each January 1 until it
reaches 25 percent of its original value. Example: If you retire on March 1, 2013
and the value of your life insurance is $100,000, your first 25 percent reduction
will occur on January 1, 2015 for a benefit equal to $75,000. Its final reduced
value will be $25,000.
More Information – VRS has
contracted with Minnesota Life
as the insurer for the Group Life
Insurance Program. For more
information, call toll free
1-800-441-2258.
What is Creditable
Compensation? –
Creditable compensation is
your annual salary not including
overtime pay, payment of a
temporary nature or payments
for extra duties such as pay for
teachers who provide coaching
or act as an advisor for special
activities.
69 | CH 13 • VIRGINIA RETIREMENT SYSTEM Plan 1