University of Virginia Library

FACULTY INSURANCE PROPOSAL

The President presented the following proposal from the Committee on Contractual Relations
which was approved by the Board as submitted:

"The Committee on Contractual Relations proposes that a plan be adopted to cover the
lives of all full-time teaching personnel and administrative and research personnel Grade 8 and
above who are age 65 and under. The insurance coverage after age 65 does not seem worthwhile,
and a substantial death benefit will have been built up in the annuity contract. While participation
in the insurance plan is optional for present staff members who are eligible, once the
plan is established, all those who subsequently become members of the eligible class must take
the insurance, and it is felt that most of those over 65 will not prefer to pay for the relatively
small coverage afforded by the group insurance.

It is proposed that the amount of coverage be as follows

       
Age  Number of
"Units of Insurance
 
35 and under 
36 through 50  2½ 
51 through 65 

For selected ages, this would provide the following insurance coverage

                 
Age  Guaranteed
Insurance
 
Additional Insurance
at the 1951 Dividend
Rate (Not Guaranteed)
 
Total Coverage
if 1951 Dividend
Paid
 
25  $ 6,740  3,370  $ 10,110 
35  4,400  2,200  6,600 
36  5,225  2,612  7,837 
45  3,025  1,512  4,537 
50  2,150  1,075  3,225 
51  2,400  1,200  3,600 
60  1,260  630  1,890 
65  840  420  1,260 

An estimate of the annual cost of the proposed plan is shown below

         
Age  Number
Eligible
 
Coverage  Total Annual
Cost for 100%
Participation
 
35 and under  104  2 units  $ 2,496 
36 through 50  147  2½ units  4,410 
51 through 65  105  3 units  3,780 
Total  356  $11,086 

298

One-half of the cost is borne by the insured staff-member, who would pay 50 cents per
month per "unit" of coverage.

The cost to the University would depend upon the age distribution of those who elect to
come into the plan. The University's share of the annual cost would be.

   
For 100% participation  $5,543 
For 75% participation  4,157 

The University's share may be reduced by prepayment of premium to.

   
For 100% participation  $4,631 
For 75% participation  3,473 
- - - - - - - - -

To conform to requirements of the Teachers' Insurance and Annuity Association, a formal
resolution will be submitted to the Board at a later date.