Request For Proposal
for Voluntary Cancer Insurance:
North Carolina Judicial Branch
of Government
Request for Proposal Number: 02-00040
June 7, 2010
Presented by:
LNL1061-NC
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Section A – Executive Summary
Section B – Corporate Background and Experience
History and Organizational Structure
More than a century ago, a fraternal organization known as the Heralds of Liberty was formed and became the forerunner of our company. In 1929, we were incorporated as a stock company called Liberty National Life Insurance Company and launched into the stormy sea of the Great Depression, which only buoyed our determination to succeed. Today Liberty National is a wholly owned subsidiary of Torchmark Corporation (NYSE: TMK). TMK is one of the largest publicly held holding companies in the nation, specializing in life and health insurance. See the organizational chart for Torchmark Corporation at the end of this section.
The directors of Liberty National are Frank J. Barrett, Larry M. Hutchison, Andrew W. King, Anthony L. McWhorter and Gary L. Coleman. Liberty National Board of Directors do not have any relationship that would give rise to an interest in the NC Judicial Branch of Government Administrative Office of the Courts (AOC) fringe benefits program. Nor is there relationship or interest in the AOC, its administrators or board members.
Liberty National has branch offices in more than 170 locations and more than 6,500 Sales Representatives. Each of these offices employs a Branch Manager, Unit Managers, and Agents and has an existing client base. Our Company believes in personal, one-on-one service for insurance needs. Our Agents call on Liberty National customers regularly at home and at their place of employment to discuss their existing coverage and personal insurance needs.
Liberty is licensed to do business in North Carolina; see the Certificate of Authority at the end of the section. We are highly ranked among major insurance companies in the country and we provide life and supplemental health insurance to individuals, families and working Americans across the country. We continue to operate and be known as a low cost provider because of our efficiency. After 100 years, success hasn't spoiled the business proposition we offered at the very beginning: Value.
We have been in the worksite arena for the past four decades. See our list of comparable clients:
Comparable Client References
State of Alabama
P. O. Box 304900
Montgomery, AL 36130
Contact: Gary Matthews – phone: 334-263-8407
State employees who work for Alabama; there are approximately 5,000 employees. Products sold are Cancer, Life and Accident.
Birmingham News Credit Union
2201 4th Avenue North
Birmingham, AL 35203
Contact: Nancy Harris – phone: 205-325-2430
Newspaper Printing Company with approximately 500 employees. Products sold are Cancer, Life and Critical Illness.
Santa Rosa County School Board
5086 Canal Street
Milton, FL 32570
Contact: Cindy Lowery - phone: 850-983-5026
School Board with approximately 2,000 employees. Products sold are Cancer, Life, Intensive Care and Health.
Section C – Financial Statement
Financial Status
See next page for Liberty’sstatutory audit reportfor 2008 and 2009.
Liberty National is rated by several financial rating agencies:
A.M. Best – A+ (Superior) as of 6/9 – Financial Size – Class X
Standard & Poor’s – AA- “Very Strong” as of 6/09
Moody’s – A1 as of 1/09
Fitch – AA (Very Strong) as of 6/08
Ward’s Top 50 Life-Health Company – named to this list every year since 1995
Section D – Project Organization
What sets Liberty National apart from other companies?
The guiding principle of Liberty National Life Insurance Company has been to achieve success by deserving it, to protect its policyholders and their beneficiaries with a fair, unselfish contract, and to serve them faithfully, adequately, honestly, and economically.
We do not use subcontractors, nor have we ever defaulted on a contract or been denied a bid due to non-responsibility to perform.
Liberty National Life Insurance Company is headquartered in McKinney, Texas. Our home office address is 3700 S. Stonebridge Drive, McKinney, Texas 75070. Our phone number is (972) 529-5085.
The authorized representative for this request for proposal is Mr. Hubert Morrison. His phone number is (972) 569-3602.
The local representative is Branch Manager, Mr. Tom Botts. Tom manages the Charlotte Central branch office for Liberty National located at:
2015 AYRSLEY TOWN BLVD
SUITE 202
CHARLOTTE, NC 28273
704-280-8452 office
704-280-8353 fax
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Section E – Voluntary Cancer Insurance Questionnaire
- From what location would you provide account / management services? The Liberty National Life Insurance Company Branch Office located in Charlotte, NC will provide account and management services.
- From what location would provide claims processing services? Liberty National Cancer claims are processed in
- Does your company control its own services or do you use another’s system or services for support? Liberty National uses its own claims, data processing and claims analysis services.
- How would you disseminate summary plan descriptions to employees? Summary Plan descriptions will be distributed to employees on an individual basis.
- Do you provide an on-site “dedicated” service representative to handle customer service related issues? Yes, our local representative will handle customer service related issues. We also have a customer service department dedicated to worksite.
- What are you customer service days and hours? Customer service representatives are available Monday – Friday from 7:30am to 5:00pm CST.
- Will you use your own staff or an outside vendor to assist with enrollments? Liberty National will use approximately 30 licensed agents within the Charlotte, NC branch office to assist in the enrollment process.
- What is the procedure for filing a claim? For a Cancer Policy claim, the Home Office must receive a copy of the Pathology report showing a malignant diagnosis along with a Doctor’s statement from the first doctor who treated the patient for the symptoms later diagnosed as cancer. An updated Claimant statement must be submitted along with UB-04 and 1500s standardized billing from the hospital and an itemized bill from the provider of service showing the service date, type of service rendered, charge per service, number of units per service, and the diagnosis. When filing for benefits providing a limited daily benefit such as chemotherapy or radiation, the bill must include a day-by-day breakdown of charges and include the CPT code. When filing for disability or income replacement benefits, we will need Section C of a Claimant’s Statement completed by the employer and a doctor’s statement completed by the doctor providing the dates of total disability. The patient must have been gainfully employed prior to disability, and the disability must be the direct result of the cancer diagnosis. Also, disability benefits will be processed to the earlier of the date of the employer’s statement or the doctor’s statement. In order to file for continued disability, updated forms must be submitted from the physician’s office.When filing for prescription chemotherapy drug benefits, we require a pharmacist receipt of the drug providing the date, type of drug and the actual costs. The retail price of the drug will not be accepted unless this is the actual cost of the drug with insurance. Please be sure to include the policy number when submitting the receipts. When filing for private duty nursing benefits, we require a Statement for Private Duty Nursing completed by the nurse, RN or LPN and/or an itemized bill from the provider of service showing dates of service, shift or hours worked and charges. When filing for transportation benefits, we require a Transportation Statement completed in full and a copy of the ticket or bill for such transportation expenses attached to the statement. We will also need a copy of the bill for the medical expense, which was incurred at the destination of travel.
- If a plan participant is on approved leave, and elects not to continue premium payments during that period will he/she be permitted to re-enroll without penalty upon returning to work? The participant would not be eligible until the next annual enrollment period. If health history has changed during the leave, the participant would have to qualify for coverage.
- To be eligible for enrollment, does your plan require the employee to work a certain number of hours per week? To be eligible, an employee must work full time. A full-time employee is defined as an employee actively at work for 30 hours or more each week.
- Define eligibility for dependent children. The employee’s children, legally adopted children and step children who are less than 21 years old, unmarried and either live with the employee or are primarily dependent upon the employee for support.
- Define eligibility for dependent spouses. Employee’s spouse is covered as long as he/she remains married to employee. Upon divorce, the coverage on the spouse ceases.
- Does your plan include a waiver of premiums? No.
- Does your plan have a pre-existing conditions clause? This policy has a 30-day waiting period beginning with the effective date of the policy. If a covered person has cancer manifested during the waiting period, coverage for that cancer will apply only to expenses incurred after 12 months from the effective date of the policy. If a covered person has cancer manifested during the waiting period no First Occurrence benefit will be paid. No benefits are payable to anyone who has cancer manifested before the effective date of the policy.
- Explain underwriting requirements of your proposed plan.
What questions are asked to those that apply for coverage? See application questions below:
- Does the proposed insured or any family member to be covered under this policy now have, or ever have had:
a) cancer, leukemia, Hodgkin's disease, melanoma, or any form of malignant growth (except skin cancer)?
b) (cystic fibrosis, diphtheria, encephalitis, Lou Gehrig's disease, meningitis, multiple sclerosis, muscular dystrophy, osteomyelitis, poliomyelitis, rabies, scarlet fever, sickle-cell anemia, small pox, tetanus, tuberculosis, tularemia, typhoid fever?
- List the names of all family members for whom a "Yes" answer applies in questions 1 & 2. Any person listed will not be covered under the Cancer Policy.
- Is any person(s) to be insured under this policy presently covered by a Liberty National Cancer Policy?
- Does your proposal include a rate guarantee? If yes, how long?
- Is the plan being offered an individual or group issued product? This product is available on an individual and group basis.
- Does the plan provide a wellness/cancer screening benefit? No.
- Is there a first occurrence benefit included in this plan? Yes. The policy pays a $3,500 benefit upon the first diagnosis of cancer in addition to all other benefits. For this benefit only, skin cancer (except for melanoma) is not covered.
- Describe the plan’s radiation and chemotherapy benefits. Policy pays up to $500 per day in or out of the hospital for radiation therapy, chemotherapy and the administration thereof. Benefits are payable only for the days in which treatments outlined in the policy are administered, or surgically implanted in person, by a doctor or nurse. No lifetime limit. Benefit ceases on the insured’s 65th birthday.
- Does the plan include an anesthesia benefit? What amount? Plan pays up to 25% of the amount payable for each surgery. No lifetime limit.
- Does the plan provide for experimental treatments? Yes. Policy pays charges for new or experimental treatment of cancer based on the regular schedule of benefits as stated in the policy.
- Is there a maximum coverage limit per person? Each policy benefit pays a specific amount, with some that set lifetime maximums. Overall there is no set cap on the amount paid to a covered insured.
Section F – Monthly Premium Cost
See the attached monthly premium costs for Liberty National’s Cancer Care Plus.
Section G – Plan Design
Eligibility:Issue ages 0-63; individual, family and single parent coverage
Effective Date:Policy is effective the date the application is signed; however a 30-day waiting period does apply and it begins on the date application is signed.
Enrollments for
Existing Employees:Active employees will be given an opportunity to enroll in the
plan during the initial enrollment, as well as a mid-year and annual enrollments.
Policy Cancellations:Employees with Cancer coverage paying with pre-tax dollars may only cancel their policy during the annual enrollment period.
Leave without Pay:If the covered employee is on an approved leave of absence, we will permit the insured to pay premiums direct to Liberty National.
Portability:The Cancer Care Plus plan is portable and will be at the same rate the covered insured paid through payroll deduction.
Coordination of Benefits:Plan pays in addition to other coverage.
Sick or Vacation Leave:Plan benefits are paid according to the policy and are not dependent on the employee’s sick or vacation leave.
Financial Strength Rating:A+ (Superior) A.M. Best for financial strength
AA- (Excellent) Standard & Poor’s for financial strength
Ratings as of 6/09
Desired Plan Benefits: Liberty National’s Cancer Care Plus policy pays the benefits that are checked below.
Hospital confinement Lodging
Surgical benefitsTransportation
Radiation/chemotherapyAmbulance benefits
Wellness benefitProsthesis/appliance
Experimental treatmentReconstructive surgery
First occurrence benefitMedical imaging
Blood, plasma, and platelets Anti-nausea
Private NursingAnesthesia
Skilled nursing Bone marrow transplant
Hospice care Skin cancer benefit
Home Health Care
In addition, our plan covers the following benefits:
Income Replacement - $100/week for up to 26 weeks
Attending Physician – up to $35/day with no maximum number of days
Outpatient surgery – up to $250/day for surgical facilities
Government hospital confinement - $3,500 for first occurrence, plus $250/day for 90
days, then $600/day thereafter for continuous hospital confinement
Dread Disease Benefit – pays $250/day for first 90 days, then $600/day for
continuous confinement due to dread diseases outlined in policy
See the Cancer Care Plus brochure following this section.
Section H – Ease of Administration
CUSTOMER SERVICE
Service is often the distinction between a good and a great company. A great company goes the extra mile not just to sell a product, but to establish a relationship with the customer. At Liberty National, we believe we are a great company, and we continuously strive to deliver superior service and customer convenience.
Liberty National’s Customer Service department has 25 experienced representatives that take incoming calls. When customers call, they hear and interact with a live person on the line, not an automated answering service. We provide general policy, billing and claim information. Our operating hours are Monday- Friday 7:30AM to 5:00PM Central Standard Time. Our toll free number is 1-800-333-0637.
Electronic employee access system
Once individuals become Liberty National policyholders they can log on to and register their policies.
BILLING PROCESS
Our Liberty National representative handling your account will go over the billing process with the bookkeeper prior to the billing date to ensure a smooth billing cycle. One of the biggest advantages Liberty offers is that payroll deductions start the first pay period of the next month following the enrollment period. This means immediately following the enrollment, the bookkeeper will receive Payroll Deduction Authorization forms to begin the deduction process. The bookkeeper will have a month to gather the deductions before Liberty National sends the first bill.
Liberty National’s billing process is on the 1st of each month for companies that pay their premiums monthly. If the company chooses to have a payment other than monthly, we would send a billing after each payment is received and applied.
When the billing is received, any deletion of terminated employees or other corrections can be noted on our billing and returned with the check for payment.
Electronic funds transfer
Liberty National provides the convenience of electronic funds transfer. The bookkeeper simply follows these two easy steps:
Step 1: When making a Direct Deposit (ACH) for your company to Liberty National, simply wire the payment to the financial institution listed below. The Transit/ABA number and the appropriate Liberty National Account number will be provided to the bookkeeper if Liberty is awarded the bid.
Financial Institution: Wachovia Bank
Step 2: Notify the following people prior to sending the ACH deposit through so they can track payment to insure proper payment:
Shortages
We will waive any shortages up to $5.00. Should there be shortages we would call to verify with the bookkeeper to determine how to balance the billing statement.
Billing Number
Our billing toll-free number is 1-888-488-0134.
Payroll Deduction Schedule
We want to make paying premiums as convenient for you and your employees as possible. Payroll deductions payment can be either of these methods:
Weekly, Bi-Weekly, Semi-Monthly, 4 Weeks, Monthly
ENROLLMENT PROCESS
Enrollment process and experience
For over 40 years, Liberty National has been meeting the life and supplemental health insurance needs of working Americans. Liberty National is sensitive to our customers’ need for the enrollment process to run efficiently, by taking the least amount of time to meet with employees. That’s why we meet with the supervisor of the department and schedule a time convenient for each enrollment.
To help promote the enrollment, Liberty National would create and print an announcement letter and provide copies to you for insertion in the last pay period envelopes prior to enrollment. This announcement letter would be on your letterhead and signed by the appropriate person, and sent to all eligible employees announcing the insurance coverage being made available to them. See sample at the end of this section.
On the scheduled enrollment date, we then meet with the employees individually to answer any questions they may have about the coverage and complete the application. The enrollment process typically takes up to 15 minutes. We also have a Laptop Sales Presentation, which outlines the need for cancer coverage using cancer facts/figures, helps detail specific product benefits and uses an electronic application process to complete the sale. Upon policy approval, the Agent will deliver the policies to the bookkeeper or contact person and a Policy Delivery Acknowledgement will be signed. The bookkeeper/contact person will distribute the policies through the normal method of internal distribution.