LONG TERM DISABILITY INCOME INSURANCE
CGP-3-R-DEPL B350.0288
This insurance replaces part of an employee's income when it is affected by disability. What we pay and the terms for payment are explained below.
DEFINITIONS
"Benefit waiting period" means the number of days of continuous disability which must pass before this plan starts to pay benefits. It is shown in the schedule.
CGP-3-LTD86-C-1.0 B350.0287
"CPI-W" means that part of the United States Department of Labor Consumer Price Index, which measures the change in the cost of a typical urban wage earner's purchase of certain goods and services. The change in cost is expressed as a percentage of the cost of those same goods and services in a base period. We use the CPI-W to compute this plan's indexing factor. If the Department of Labor changes or stops publishing the CPI-W, we have the right to use some other similar standard.
CGP-3-LTD90-2.0 B350.0336
"Current monthly earnings" means: (a) for the first six months of disability, the disabled employee's exact rate of monthly earnings; and (b) for each further six month period, such employee's average rate of monthly earnings for the prior six month period.
"Disability" means: (a) an employee is not able to perform all of the material duties of his regular occupation on a full-time basis due to sickness or injury; and (b) the employee's current monthly earnings, if any, are, solely due to his disability, less than 80% of his indexed prior monthly earnings. While an employee is so disabled, he can engage in: (i) any other suitable occupation full or part-time; (ii) some but not all of the material duties of his regular occupation full or part-time; or (iii) all of the material duties of his regular occupation part-time. When we determine if an occupation is suitable, we look at the einployee's education, training and experience. This plan only covers disability that starts while the employee is insured by this plan.
"Doctor" means any medical practitioner we're required by law to recognize, who: (a) is properly licensed or certified as such by the laws of the state where he practices; and (b) provides services that are within the lawful scope of his practice.
"Employee" means an employee insured by this plan.
"Gross monthly benefit" means this plan's maximum monthly benefit amount before it is integrated with specified other income and earnings. It is shown in the schedule.
"Injury" means: (a) all bodily injury due to an accident; and (b) all complications thereof.
"Maximum payment period" means the longest period that benefits are paid by this plan for continuous disability. It is shown in the schedule.
"Monthly earnings" is defined in the schedule. As part of proof of loss we require, a disabled employee must give us acceptable proof of his prior monthly earnings and any current monthly earnings. If he doesn't, we won't pay any benefits. Such proof must consist of: (a) copies of the employee's U.S. Individual Tax Returns: (b) a statement from a certified public accountant; or (c) any other records we agree to accept.
"Net monthly benefit" means this plan's monthly benefit after the gross monthly benefit is integrated with specified other income but before it is reduced by any applicable current monthly earnings.
"Net monthly payment" means this plan's net monthly benefit less any specified reduction by a disabled employee's current monthly earnings. See "How We Compute Net Monthly Payments" for details.
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"Plan" means the Guardian group long term disability income insurance plan the employer bought.
"Prior monthly earnings" means an employee's rate of monthly earnings right before his disability starts.
"Regular occupation," for a doctor, means the medical specialty practiced by the doctor right before the start of his disability. For a lawyer, it means the legal specialty practiced by the lawyer right before the start of his disability. For any other employee, it is the employee's occupation right before the start of his disability.
"Retirement plan" means a defined benefit plan or a defined contribution plan funded wholly or in part by the employer's deposits for his employees' benefit. The term does not include: (a) profit sharing plans; (b) thrift plans; (c) non-qualified deferred compensation plans; (d) individual retirement accounts; (e) tax sheltered annuities; or (f) stock ownership plans.
Retirement plan "retirement benefits" are lump sum or periodic payments by a retirement plan at normal or early retirement. Some retirement plans also make payments for disability (as defined by such plans) that start before normal retirement age. When such payments actuarially reduce the amount that would otherwise have been paid at normal retirement age, they are "retirement 6enefits." When such payments do not so reduce the normal retirement amount, they are "disability benefits."
"Sickness" means: (a) any illness or disease; (b) all related conditions; and (c) all complications and recurrences thereof. This plan treats pregnancy like a sickness.
"We," " us," "our" and Guardian mean The Guardian Life Insurance Company of America. Other terms with special meanings are defined where they are used.
CGP-3-LTD90-3.1 B350.0359
HOW THIS PLAN WORKS
When and How This Plan's Net Monthly Payments Start:
To start getting net monthly payments from this plan
an employee must meet all of the following conditions:
Once we approve the employee's initial proofs of disability and earnings, we start to make net monthly payments. The first net monthly payment is made from the day after the benefit waiting period ends. How long we continue to make such payments is based on all of the terms of this plan.
We require periodic proof of: (a) continued disability; (b) continued regular doctor's care for the cause of the disability; and (c) any current monthly earnings. See "Accident and Health Claims Provisions" for how often we can ask tbis.
When Disability Ends: An employee's disability ends on the earlier of: (a) the date he earns at a rate of at least 80% of his indexed prior monthly earnings; or (b) the date we determine he is able to perform all of the material duties of his regular occupation on a full-time basis, even if he chooses not to.
When This Plan's Payments End: This plan's net monthly payments end on the earliest of: (a) the date the employee's disability ends; (b) the date the employee dies; or (c) the end of the maximum payment period.
If we do estimate them, we adjust the employee's net monthly payments when we receive written proof: (a) of the amount awarded; or (b) that such benefits are denied after any reapplications or appeals we require. In the case of (b), if such adjustment shows we underpaid the employee, we pay him the full amount of the underpayment in a lump sum.
CGP-3-LTD86-A-6.0 B350.0031
How We Compute Net Monthly Payments: When we compute net monthly benefits, we reduce the gross monthly benefit by the full amount of the income we integrate.
To compute an employee's net monthly benefits from this plan: (1) determine his gross monthly benefit from the schedule; and (2) from the gross monthly benefit, subtract the sum of all of the income we integrate with. The result is an employee's net monthly benefit.
From the start of a continuous disability through the first 12 consecutive months for which we pay benefits, if the sum of the employee's gross monthly benefit and his current monthly earnings is not greater than 100% of his prior monthly earnings, his net monthly payment from this plan is his net monthly benefit. If such sum is greater than 100% of his prior monthly earnings, the employee's net monthly payment from this plan is his net monthly benefit reduced by the part of such sum which exceeds 100% of his prior monthly earnings.
When benefits have been paid for 12 consecutive months, if the employee's current monthly earnings do not exceed 20% of his prior monthly earnings, his net monthly payment from this plan is his net monthly benefit. If the employee's current monthly earnings are more than 20% of his prior monthly earnings, his net monthly payment from this plan is his net monthly benefit reduced by 50% of his current monthly earnings.
CGP-3-LTD90-7.0 B350.0316
Cost of Living Freeze: After we compute the first net monthly benefit, we don't reduce an employee's benefit due to cost of living increases in social security benefits or other income benefits we integrate with. But we do adjust net monthly payments when a disabled employee's current monthly earnings change.
Minimum Net Monthly Payment: This plan's minimum net monthly payment is the larger of: (a) 15% of an employee's gross monthly benefit; or (b) $100.00.
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How the Indexing Benefit Works: A disabled employee is eligible for this plan's indexing benefit after: (a) this plan's benefit waiting period; and (b) he has received 12 consecutive net monthly payments from this plan.
When the employee becomes eligible for this plan's indexing benefit, we multiply his prior monthly earnings by the indexing factor to obtain his indexed prior monthly earnings.
The indexing factor is the lesser of: (a) 10%; or (b) the percentage increase in the CPI-W for the prior calendar year of coverage.
While an employee is eligible for this indexing benefit, we calculate a new indexing factor once a year. The maximum number of times we compute a new indexing factor is shown in the schedule.
CGP-3-LTD90-IX B350.0338
Survivor's Benefit: We pay an employee's surviving spouse, if any, a lump sum survivor's benefit if the employee: (a) dies while entitled to a net monthly payment from this plan; and (b) was disabled for at least 6 consecutive months at his death. The amount we pay is shown in the schedule.
If there is no living spouse, we pay the employee's eligible children in equal shares. To be eligible, each child must be unmarried, and: (a) less than age 23; or (b) if enrolled as a full-time student at an accredited school, less than age 25.
We don't pay this benefit if there is no living spouse or eligible children.
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Payments for Partial Months: When a disability lasts part of a month, we pay 1/30 of the net monthly payment for each day for which we are liable.
Waiver of Premium: We waive all premiums for an employee's long term disability income insurance which fall due while he is entitled to receive a net monthly payment from this plan.
If This Plan Ends: This insurance ends when the group plan ends. It also ends when this insurance is dropped from the group plan for all employees, or for an employee's class. If either happens while an insured employee is disabled, we pay the employee benefits as if his insurance did not end. But what we pay will be based on all of the terms of this plan.
Overpayments - Our Recovery Rights: If we determine that we overpaid an employee, we have the right to recover the amount overpaid. We have this right when overpayments are made for any reason, including those that result from retroactive lump sum awards by any of the income benefits we integrate with.
CGP-3-LTD86-C-12.0 B350.0069
SPECIAL LIMITATIONS
Mental or Emotional Conditions, Alcohol Abuse and Drug Abuse: If an employee is disabled by a mental or emotional condition, alcohol abuse or drug abuse, we limit the duration of this plan's payments.
For these conditions, our payments stop at the earliest of: (a) the end of two years of payments by this plan; (b) the end of the maximum payment period shown in the schedule; or (c) the date disability ends.
But, if, at the end of the two year payment period, an employee is being treated for the cause of his disability as an inpatient in a qualified institution, we extend our payments. We extend them until the earliest of; (a) 90 days from the date of the employee's discharge; (b) the end of the maximum payment period; or (c) the date disability ends.
By "qualified institution", we mean a legally operated hospital or other public or private facility licensed to provide inpatient medical care and treatment for the cause of the employee's disability-
CGP-3-LTD86-C-13.0 B350.0072
Pre-Existing Conditions: A pre-existing condition is a sickness or injury, including all related conditions and complications, for which, in the 3 months before his insurance starts, an employee: (a) sees a doctor; (b) takes prescribed drugs; or (c) receives other medical care or treatment.
We don't pay benefits for disability caused by such a condition, unless disability starts after the employee is insured by this plan for 12 consecutive months.
If This Plan Replaces Another Plan:
This plan may be replacing a long term disability plan the employer had with another insurer.
When this happens, we pay benefits for disability caused by a pre-existing condition, if: (a) the employee was insured by the old plan; and (b) the old plan would have paid benefits for such disability. But, this plan must start right after the old plan ends.
And we limit what we pay to the lesser of: (a) what the old plan would have paid; and (b) what we normally pay. We deduct all payments made by the old plan under an extension provision.
CGP-3-LTD86-C-14.0 B350.0079
EXCLUSIONS
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