Life and AD&D Highlights

Without enough life insurance, many families have to reduce their standard of living after the loss of an income. Consider your current and future financial needs when evaluating how much coverage you need. The most common short and long-term financial needs include:

• Medical bills and funeral expenses
• Living expenses for the surviving family (housing, food, clothing, utilities, etc.)
• Large expenses, (e.g., college education or home mortgage)
• Taxes and debts that need to be settled

Practice Paid Life and AD&D

Radiology Partners provides basic Life and Accidental Death & Dismemberment (AD&D) insurance through Prudential. We pay for this benefit on your behalf.

• Hourly Teammates: $50,000 benefit
• Salaried Teammates: 1x annual salary up to $150,000

A note about taxes: A life insurance benefit over $50,000 is considered a taxable benefit. According to federal tax law, only the first $50,000 of employer-paid life insurance is available tax-free. Any coverage amount above $50,000 is considered a taxable benefits and will be included as imputed income on your W-2. If you want to opt out of the full benefit and to eliminate the imputed income, you can elect a flat $50,000 life benefit.

What is imputed income? 

Imputed income is when you are provided a benefit that is non-cash but considered compensation. You are still required to pay taxes on the calculated value of the benefit—in this case, the amount of employer-paid life insurance over $50,000. Imputed income for group term life insurance is calculated using the IRS Premium Table (shown below).

To calculate the monthly cost of the insurance that will add to your taxable income, multiply every $1,000 of coverage exceeding $50,000 (to the nearest $1,000) by the fixed cost per coverage based on your age using the information found in IRS Publication 15-B.

Voluntary Life and AD&D

Insurance through Prudential allows you to purchase additional Life and AD&D coverage for yourself as well as for your spouse/domestic partner and/or child(ren). Keep in mind, you must be enrolled in voluntary Life insurance if you want to elect coverage for your spouse/domestic partner and/or child(ren). You pay the full cost of this coverage through after-tax payroll deductions.

• All Support, Physicians, and Executive Teammates: $10,000 increments up to 5x base annual earnings up to $500,000. The Guaranteed Issue is $350,000.
• Spouse/Domestic Partner: $5,000 increments to a maximum of $250,000. The Guaranteed Issue is $100,000.
• Child(ren): $10,000. The Guaranteed Issue is $10,000.

When you are in your initial enrollment period, you may elect coverage up to the Guaranteed Issue (GI) amount without providing Evidence of Insurability (EOI), also referred to as a health status questionnaire. If you elect more than the GI, you must complete an EOI and have the amount that exceeds the GI approved by Prudential.

If you waive your election for voluntary coverage in the initial enrollment period or during open enrollment, you may still apply at any point in the future if you change your mind; however, you will be required at that time to complete the EOI process and the GI amount no longer applies. Prudential will not grant coverage until it receives your EOI and issues approval.

Key Terms

• Evidence of Insurability (EOI): also known as “evidence of good health” or “health status questionnaire” is the process by which Prudential determines if you are insurable for the amount of coverage you want.
• Guaranteed Issue (GI): the amount of voluntary Life coverage you can get without providing EOI. Any coverage elected over GI will require the completion of EOI for approval.

Check Your Beneficiaries!

Make sure that you have named your beneficiary for your life insurance benefit, and update it if your marital status changes or if you have changes in your family.

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