HomeMy WebLinkAboutResolution - 473 - 2 Agreements - Aetna & HNB - Funds Transfer From TCB For Insurance Plan - 04/10/1980t' ,� RESOLUTION #473 - 4/10/80
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BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock BE and is hereby authorized and
directed to execute for and on behalf of the City of Lubbock a Split -Funded
Group Plan Service Agreement with Aetna, a Banking Agreement with Hartford
National Bank, and a Letter to Texas Commerce. Bank authorizing the transfer of
funds to Hartford National Bank, a copy of such documents is attached herewith
which shall be spread upon the minutes of the Council and as spread upon the
minutes of this Council shall constitute and be a part of this resolution as
if fully copied herein in detail.
Passed by the Council this 10th day of April 1980.
ATTEST -i-- -
;Evelyn Gaff a, ity Sec etary- easurer
`APPROVED AS TO CONTENT:
Tom Witt, Personnel Director
APPROVED AS TO FORM:
AW. fReagan,�As t. 011ty Attorney
LUBBOCK CITY COUNCIL
CITY OF LUBBOCK
LUBBOCK, TEXAS
April 10, 1980
Mr. Tony Wayland, Vice -President
Texas Commerce Bank
P. 0. Box 841
Lubbock, Texas 79408
Dear Mr. Wayland:
The City of Lubbock is in the process of entering into an agreement with
Aetna Life Insurance Company to implement a Split Funded Group Plan.
One of the requirements of this plan is that Aetna's bank, Hartford
National Bank and Trust Company, be authorized to wire or telephone your
bank with a request for -funds from our Aetna Insurance Account, number
8-415-2321, and receive those funds the same day as the request.
This letter is authorization for Texas Commerce Bank to accept and
comply with the requests of Hartford National as noted above. Additionally,
we would request that copies of transfers made be sent to our Investment
Analyst Gene Brock.
Attached is a copy of our banking agreement with Hartford National Bank.
Sincerely,
Bill McAlister
Mayor
BM:js
Enclosures
RESOLU11ON #473 - 4/10/80
BANKING AGREEMENT
THIS AGREEMENT by and between City of Lubbock, Texas, herein called City, and
Hartford National Bank, herein called Hartford,
W I T N E S S E T H:
WHEREAS, agreement has been reached with Aetna Life Insurance Company, Hartford,
Connecticut, herein called Aetna, whereby Aetna is to act as City's agent in
making benefit payments for which City is liable under certain of City's
employee benefit plans;
NOW THEREFORE THE PARTIES HERETO AGREE AS FOLLOWS:
Drafts in payment of these benefits will be drawn by Aetna on bank account
number 034-3372 (the Account) at Hartford National Bank and Trust Company
(Hartford National).
Drafts made payable through the Account are to be presented to Aetna. Subse-
quent to Aetna's inspection of the drafts, Aetna will advise Hartford National
of the amount to be charged to City. Hartford is to advise City's bank, as
designated below, by wire or telephone, to make available to Hartford, on the
same day the request is made, sufficient federal funds to cover the total
amount of our identified liability for drafts paid, as determined by Aetna.
City's designated bank will be under standing instructions from City to accept
and comply with such orders from Hartford National.
Copies of transfer notices should be sent by Hartford National to City's
designated representative as shown below.
City understands that Hartford, or such other financial institution with which
there is a working agreement, may advance funds to the Account on City's
behalf in order to fund payments from the time drafts are presented for payment
until the time reimbursement is provided by City's designated bank and City
agrees to repay all such advances.
Send Copies of Fund
Transfer Requests To
Name of
Representative: Gene Brock
Title: Investment Analyst
Address: City of Lubbock
CITY OF LUBBOCK, TEXAS
C
By:
Title: MAYOR
Date: April 10, 1980
ATTEST:
- &��_ _�
Evelyn Ga fga, City e e ry-Treasurer
APPROVED AS TO CONTE
C
Rod Bouff7, Internal Auditor
APPR ED AS TO FORM:
David W. Reagan, Ass st City Attorney
Send Fund Transfer
Request To
Tony Wayland
Vice -President
Bank: Texas Commerce Bank
City of Lubbock
Account Name: Aetna Insurance Acct.
Account Number: 8-415-2321
HARTFORD NATIONAL BANK
By:
Title:
Date:
A 151 Farmington Avenue Donald P. Burke
M Me Hartford, Connecticut 06156 Secretary
Group Division
LIFE & CASUALTY
April 4, 1980
City of Lubbock
Lubbock, Texas 79457
Gentlemen:
The Split Funded Group Plan Agreement, GR-SFGP, issued to the
City of Lubbock, effective May 3, 1980, provides for iEtna to
administer the Contractholder's plan, the benefits of which
are described in specified Group Policies, and contains a
right for either ,Etna or the City to discontinue the Agreement
as specified in such Agreement.
This confirms that exercising the right to discontinue the
SFGP Agreement has no effect on the rights of either party as
provided in the Group Policies. If, for example, a notice was
provided by one party or the other to terminate the SFGP
Agreement only, termination of that Agreement would not alter
or change the terms and provisions of the Group Policies. The
Plan would in effect revert to a conventionally insured plan
with an appropriate adjustment of the premium rates under the
Group Polities.
Very truly yours,
am�a /a &,,4 -
Donald P. Burke, Secretary
,,Etna Life Insurance Company / The ktna Casualty and Surety Company / The Standard Fire Insurance Company
• J y RESOLUTION #473 - 4/10/80
,., AGREE '
This Agreement by and between
CITY OF LUBBOCK
(herein called the Contractholder)
and !E'T'NA LIFE INSURANCE COMPANY (herein called lEtna),
WITNESSETH:
WHEREAS, the Contractholder has established an Employee Benefit Plan some or all
Of the benefits of which are described in certain group insurance policies (here-
in called the Group Policies) issued by !Etna and listed in Appendix I; and
WHEREAS, the Contractholder wishes to accept liability for payment of such benefits -
described in the Group Policies, subject to certain maximum payment limits as de-
scribed herein; and
WHEREAS, the Contractholder has requested !Etna to serve as its agent with respect
to payment of such benefits and !Etna is willing to do so in accordance with the
terms of this Agreement;
NOW, THEREFORE, it is agreed as follows:
1. This Agreement shall be effective May 39 1980
2. In this Agreement:
a) "Plan" means only that portion of the Contractholder.'s Employee Benefit
Plan which is described in the Group Policies.
b) "Benefits payable to Participants under the Plan" shall mean those benefits
for which coverage is described under the Group Policies, including,
any extensions of such coverage.
c) A."contract year" shall coincide with a policy year as that term is defined
in the Group Policies, except that the first "contract year" shall commence
with the effective date of this Agreement and the last "contract year" shall
terminate up= tcz—_ ination of this Agreement.
d) A "contract month" shall coincide with a policy month as that term is defined
�,..� in the Group Policies, except that the first "contract month" shall commence
with the effective date of this Agreement and the last "contract month" shall
terminate upon termination of this Agreement.
e) Benefits become "due" upon receipt'by !Etna of dud proof, in accordance with
the provisions of the Group Policies pertaining to proof of claims, in sub-
stantiation of such claim.
f) Benefits become "payable" or "paid" when a draft dzuwn in satisfaction of a
claim for benefits that become due has been accepted for payment by the drawee
bank and has been reported to !Etna.
-2-
3- This Agreement shall apply with respect to the classes of employees and cover-
ages designated in Appendix I, and shall apply to all claims of such employees
and their covered dependents (herein called Participants) under such coverages
with respect to benefits due during the continuance of this Agreement.
4. (a) The Contractholder shall be liable for, and agrees to provide funds suf-
ficient to satisfy, all benefits payable to.Participants under the Plan
subject to a maximum payment by the Contractholder for all benefits pay-
able with respect to Participants under the Plan while this Agreement is
in force (hereinafter referred to as the Liability Limit).
(b) The Liability Limit for any contract month prior to termination of this
Agreement shall be equal to the sum of:
(i) the product obtained by multiplying the number of Participants,
indicated by Etna'sreeords,on the first day of the contract month
by the appropriate Liability Limit Factor set forth in Appendix II,
plus
(ii) an amount equal to the Liability Limit for the preceding contract
month less the amount of benefits actually charged against the
Liability Limit in that month, but not less than zero, except
that this Item (ii) shall be zero for any contract month which
corresponds to the first contract month of a contract year.
(c) In no event shall the Contractholder's liability for Major Medical or Com-
prehensive Medical Expense Benefits with respect to any Participant exceed
#,. the limit set forth in Appendix I, if any.
5. In the event that the Contractholder does not pay benefits under the Plan for
which it is liable under this Agreement, )Etna shall arrange for payment of such
benefits on behalf of the Contractholder, subject to reimbursement in accordance
with paragraph 6 hereof. This paragraph shall not apply to residents of Cali -
forma, if any.
6. If any person or organization pays any amount of benefits which is an obligation
of the Contractholder hereunder, the Contractholder shall reimburse such person
or organization to the extent of such payment, plus any reasonable costs or charges
in connection with such payment. In no event shall any such payment by either
party to this Agreement, or by any other person or organization, be construed as
obliging such party, person or organization to assume any liability of any other
party, person or organization for payment of benefits.
GR-SFGP 1007
i
7. Fina shall, as agent for and on behalf of the Contractholder:
a) make final determination of the amount of benefits, if any, to which a Participant
may be entitled under the Plan, in accordance with the terms and conditions describe
in'the Group Policies, and
b) undertake the defense of any suit brought with respect to any claim for benefits
hereunder and settle any such suit when in its judgment it appears expedient to do
so.
With respect to any benefits payable to residents of California, the Contractholder
shall be responsible for the obligations set forth in (a) and (b) above.
The Contractholder agrees to pay the amount of benefit payments included in any
judgment or settlement to the extent of its liability hereunder. Benefit payments
�., made in accordance with the terms of any judgment or settlement shall be considered
benefits paid to Participants under the Plan for the month in which such judgment or
settlement is satisfied.
8. This Agreement may be terminated by either party on 31 days written notice stating
when, after the date of such notice, such termination shall become effective.
If the Contractholder fails to provide funds necessary to satisfy its liability here-
under, this .Agreement shall terminate immediately upon written notice from Etna to the
Contractholder.
If any state or other jurisdiction enacts a law or regulation which, as determined by
Fina or by the Contractholder, prohibits the continuance of this Agreement, or if
existing law or regulation is, as determined by !Etna or by the Contractholder, amended
or construed to prohibit the continuance of this Agreement, this Agreement shall ter-
minate as to such jurisdiction (a) as of the date such law is determined to be effec-
tive, or (b) the date such notice is received by Stna, that the Contractholder has made
such determination.
9. Payment of benefits under the Plan shall be by draft drawn by Etna as agent for the
Contractholder on a bafA account at Hartford National Bank and Trust Company, Hartford,
Connecticut (hereinafter called Hartford National). Such drafts shall be presented
by Hartford National to JEtna, who shall advise Hartford National of the amount to be
charged to the Contractholder. Hartford National, upon approval of the draft. by Fina,
will notify the Contractholder or its designated bank of the amount of the drafts ap-
proved by Etna. The Contractholder or its designated bank shall, on the date: of such
notice, make available to Hartford National an amount in Federal funds equal to the
total -of such drafts. The Contractholder authorizes ]Etna to draw and approve such
drafts for the purpose of payment of benefits to Participants under the Plan and agrees
to enter into such agreements, and to issue such instructions to its designated bank,
as are necessary to effect the terms of this paragraph.
�,, GR-SFGP 1009
10. (a) (Etna shall use ordinary care and reasonable diligence in the exercise of its
powers and the performance of its duties hereunder, but shall not be liable
for any mistake of judgment or other action taken in good faith.
(b) Etna agrees to indemnify the Contraetholder and hold the Contractholder
harmless against any and all loss, damage and expense Stith respect to this
Agreement resulting from or arising out of the dishonest, fraudulent or
�.•, criminal acts of Etna's employees, acting alone or in collusion with others.
Etna shall maintain Blanket Bond coverage with a limit in reasonable propor-
tion to the volume of benefit payments under the Plan.
(c) The Contractholder shall furnish a written notice to each employee covered
under the Plan who was previously insured by Etna, on the date this Agree-
ment becomes effective as to such employee, that the Contractholder is
liable for payment of a portion of the benefits under the Plan and that this
portion will no longer be insured by Etna Life insurance Company. The Con -
f tractholder agrees to indemnify Etna and hold Etna harmless against any and
all loss, damage and expense sustained by Etna as a result of any failure by
the Contractholder to provide such notice.
f� (d) The Contractholder agrees to indemnify Etna and save Etna harmless against any
liability with respect to premium taxes (by whatever name called), assessments
and penalties incurred by Etna by reason of benefit payments made or services
performed hereunder, and any interest thereon.
(e) The functions to be performed. by !Etna under this Agreement may, at Etna's
discretion, be performed wholly or in part by or through any other organi-
zation, uhich is a subsidiary or affil:Late of Etna or under a contract with
an organization of its choosing.
11. The Contractholder agrees to furnish to Etna all information which Etna may from
time to time require in order to determine if and when the Contractholder's Lia-
bility Limit has been reached. The Contractholder shall notify Etna immediately
as to any modification of the Plan or of the termination thereof. Etna shall not
be responsible for any delay or non-performance of its functions under this Agree-
ment which is caused or contributed to in whole or in part by the failure of the
Contractholder to timely furnish any required information.
12• The terms and provisions of this Agreement shall be'construed iri accordaner with
the laws of the State of Texas.
IN WITNESS WEEREREOF, the parties hereto have caused this Agreement to be executed.
Dated at LUBBOCK, Texas 4/10/80
CONTRA O
C I TY4 F - 880 eT
Byt.
r, ayor
Official Title
ATT
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Evelyn Gafi:gf, .,City . Secretar}l"-�f asurer
GR-SFGP
Dated at Hartford, Conn. A=J 1
?NSURAN�C('PANY
By:
Secretary
Official Title
egistrar
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APPENDIX II
Monthly Liability
Eligible Classes of Employees
Limit Factor
Group Policy No. GC -383629
Under age 65
f^
Employee
Basic Medical
Regular
$25.09
Special
24.75
Major Medical
Regular.
3.64
Special
3.64
�^
Dependents
Basic Medical
Regular
25.65
Special
22.74
�.
Major Medical
6.16
Regular
Special
6.16
Over Age 65
Employee
14.00
Dependent
14.00
ADDENDUM
RETROSPECTIVE PREMUM AGREEMENT
Etna Life Insurance Company (Etna) and the City of Lubbock (the Policyholder),
in consideration of their mutual interests in establishing a retrospective
premium rating arrangement with respect to the coverage designated for ex-
perience rating purposes as ERG 383629 (the coverage), agree that a retrospective
premium or experience credit shall be determined and due as of the end of each
experience accounting period while this Agreement is in force.
If Etna's experience accounting statements with respect to such period indicate
that the coverage is in a surplus financial position as of the end of the
period, the amount of such surplus shall be credited to the Policyholder.
If such experience accounting statements indicate that the coverage is in a
deficit financial position as of the end of the period, a retrospective premium
shall be payable by the Policyholder within 31 days following the date notice
of such due premium is provided by Etna. The amount of any such retrospective
premium payment shall be the lesser of:
a) The amount of the deficit shown in Etna's experience
accounting statements, or
b) (i) 896 of credited premium and accumulative Liability
Limit as shown in such experience accounting state-
ments, plus
(ii) The amount by which the policyholder's aggregate
Liability Limit for that portion of the coverage ad-
ministered under agreement form GRA-SFGP effective
May 3, 1980 exceeds the amount of claims paid
directly by the policyholder and charged against
such Liability Limit as shown in such experience
accounting.
This agreement shall be effective 'May -3,: 1980 and may be terminated by either
party on 31 days' written notice to the other party. In the event of termination
of this Agreement, the date of such termination shall be deemed to be the end of
an experience accounting period.
THE CITY UBBOCK: En
By By
Name
Mayor
Title
Lubbock, Texas
Date Place
GR -BP -2
Hartford, Conn.
Date