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Retiree life insurance study: raising $10,000 benefit to $20,000 would more than double annual cost, presenters say
Summary
USI and Deloitte told the committee Metro pays about $3.1M per year for a $10,000 employer-paid retiree life policy covering about 9,100 retirees; increasing the benefit to $20,000 would raise annual cost to about $7.4M and add roughly $60M to Metro's OPEB liability. The committee voted to place the item back on a future agenda if members request it.
USI consultant Joe Myers told the committee that Metro currently provides a $10,000 employer-paid life insurance benefit to retirees, costing roughly $3.1 million annually for about 9,100 retirees. Myers said raising the benefit to $20,000 would increase the annual premium to about $7.4 million and add approximately $60 million to the OPEB liability on Metro’s books.
The presenters reviewed peer comparisons for 22 peer cities: 17 peers provide no employer-paid retiree life insurance; a small number offer modest amounts, meaning a $20,000 benefit would place Metro at the high end among peers. Committee members noted funeral and cremation costs presented during the discussion and asked for time to consider whether to return the item to a future agenda; the committee voted unanimously to place the item back on the agenda upon request to Miss Hickey.
