Error Results in Some Faculty Being Overcharged
for Supplemental Life Insurance
Several MIT faculty members who reached their 65th birthday as of July 1 of 2006 were inadvertently overcharged for supplemental life insurance under the Plan provided by MIT.
MIT provides all employees up to $50,000 of Basic Life Insurance. Additionally, all faculty (and staff) may purchase up to 5 times their salary in Supplemental Life Insurance. However, on the July 1st following their 65th birthday, the amount of available Basic and Supplemental Life Insurance decreases. Between the ages of 65 and 70, employed faculty may purchase up to 3.3 times their salary in Supplemental Insurance. After age 70, the amount decreases to 2.2 times their salary. After age 75, 1.6 times their salary, and so on, until after age 95 it is reduced to 0.6 times their salary.
Recently, the Faculty Newsletter learned that several employed faculty over the age of 65 were mistakenly charged for their elected 5 times salary Supplemental Life Insurance when they were only eligible for 3.3 times their salary and therefore should have been paying a correspondingly lower rate.
When contacted by the Faculty Newsletter, Vice President for Human Resources Alison Alden replied, “I am aware of this situation and am happy that it is being resolved. . . .In this unique circumstance, the overpayment resulted when a necessary override prevented the automated coverage reduction process from functioning correctly – so I ask that we keep this in mind.” The Benefits Office has corrected this situation and is in the process of reimbursing affected faculty for the overpayment.
If any faculty have specific concerns about their life insurance they can contact Elizabeth Parr by calling x3-6151.