I. Statement of Objectives
The State of Connecticut, acting through the Office of the State Comptroller (OSC), is seeking the services of an insurer with the capital strength, expertise, and capability to administer and insure its group life insurance benefits program for employees and retirees.
II. Background Information
The State Comptroller is empowered by Connecticut General Statutes, Section 5-257 to arrange and procure a group life insurance benefits program for employees and retirees. Section 5-257 is the authority under which group life insurance benefits are extended to the work force. A copy of Section 5-257 is attached hereto as "Exhibit A".
There were approximately 57,000 people insured under the present contract during the fiscal year ended June 30, 1996. The premiums for that year were approximately $10.7 million.
OSC currently employs three full-time staff members who perform the administrative functions of the group life insurance program. These functions include record-keeping, processing premium payments, and obtaining necessary documentation for claim submission.
III. Current Plan Design
"Exhibit B", which is a Summary Plan Description, sets forth the group life insurance benefits provided by OSC. Briefly, the benefits and employer/employee/retiree contributions are as follows:
|Active Employee Benefit||Retire Benefit|
Upon attaining eligibility, employees are offered the basic coverage on a guaranteed issue basis; no medical underwriting is conducted and no physical examinations are performed.
IV. Transition Period
OSC's current group policy will terminate on June 30, 1997. OSC will have a cancellation accounting on August 30, 1997 and a final accounting on June 30, 1998. OSC will continue to remit premiums through June 30, 1997 to the current insurer which will, correspondingly, continue to pay eligible benefit applications for death claims incurred through June 30, 1997. OSC will commence remitting premiums on July 1, 1997 to the successor carrier which will, correspondingly, assume responsibility to pay eligible benefit applications for death claims incurred on and after July 1, 1997 with the exception of the following:
V. OSC's Objectives for the Financial Administration of the Group Life Insurance Program
In order for the earlier-stated, overall objective of this RFP to be achieved, OSC has identified three separate components which must be satisfied, as follows:
1. Stabilize OSC's long term unit funding rates at or close to their current level.
To satisfy this component of the overall objective, OSC is seeking a contract duration of six years, from July 1, 1997 to June 30, 2003, renewable for subsequent six year periods upon mutual agreement of the parties.
The contract's unit funding rates, expressed as the monthly cost of $1,000.00 of insurance, will be:
In order for any submission made in response to this RFP to be considered, rates for the period from July 1, 1997 to June 30, 1999 may not exceed $.53 per month for $1,000.00 of insurance coverage across all programs and groups.
2. To introduce a method of reporting which makes it possible for OSC's managers of the program to understand the financial results and their impact on state budgeting without becoming experts on the technical complexities of the group life insurance.
Although OSC is soliciting fully-underwritten rates through this RFP, its managers remain interested in the financial performance of the group life insurance program. To satisfy this component of the overall objective, the carrier selected will be required to supply OSC, no later than October 1 of each year, with an annual financial report which complies with the format utilized in "Exhibit C" and, at a minimum, discloses the applicable data elements contained therein.
In order for any submission made in response to this RFP to be considered, the insurer must affirmatively represent that it will supply OSC, no later than October 1 of each year, with an annual financial report which complies with the format utilized in "Exhibit C" and, at a minimum, discloses the applicable data elements contained therein.
3. To contain the insurer's expense charges from year to year as a function of services rendered.
For the fiscal year ending June 30, 1996, the present insurer's expense charges (including but not limited to administration, risk, and profit) were approximately 2.6% of annual premiums. To satisfy this component of the overall objective, OSC has identified this percentage to be the maximum for such services.
In order for any submission made in response to the RFP to be considered, expense charges (including but not limited to administration, risk, and profit) may not exceed 2.6% of annual premiums.
VI. Proposal Submission Requirements
1. The insurer must submit an original plus ten (10) copies of a written proposal in loose-leaf binders to:
STATE OF CONNECTICUT
Retirement and Benefit Services Division
Office of the State Comptroller
55 Elm Street, Third Floor
Hartford, Connecticut 06106
Attention: Steven Weinberger, Division Director
2. Insurers with questions regarding this RFP should submit them in writing to Mr. Weinberger at the address set forth above no later than 4:30 p.m. on Friday, April 4, 1997. Answers to such questions will be transmitted from Monday, April 7 to Friday, April 11, 1997. No phone calls will be accepted relative to this RFP.
3. Proposals must be received on or before 4:30 p.m., Friday, April 18, 1997.
4. Each proposal must include the following:
The title page should indicate the date, subject, name of the insurer, and the address, telephone number, name, and title of insurer's contact person.
A description of the office that would support the state's activities, including its geographic location, staffing level, the background, experience, and qualifications of personnel, as well as other available resources.
A description of the insurer's experience administering and insuring group life insurance benefits programs for large employers with unionized workers and multi-site billing and enrollment. List all other comparable government agencies, corporations, and organizations that you have provided these services for in the past two (2) years, specifying those with a unionized work force. This experience profile should not exceed four (4) pages.
For each biennium of the six year period commencing on July 1, 1997 and terminating on June 30, 2003, fully-underwritten rates, expressed as the monthly cost of $1,000.00 insurance. Each biennial rate must be unified, meaning identical in each year of the biennium; and blended, meaning no separate recognition of individual programs and groups.
Rates must be presented in the format contained in "Exhibit C", which is the annual reporting model the successful insurer will be required to utilize. As referenced previously, although OSC is soliciting fully-underwritten rates, its managers remain interested in the financial performance of the group life insurance program. By generating rates formatted in this fashion, it is OSC's intention to evaluate the assumptions and projections which underline the insurer's proposed unit funding cost.
To assist insurer's in pricing their proposals, four exhibits are specifically included with this RFP, as follows:
Please remember that, in order for any submission made in response to this RFP to be considered, rates for the period from July 1, 1997 to June 30, 1999 may not exceed $.53 per month for $1,000.00 of insurance coverage across all programs and groups.
Section 4-114a-3(10) of the regulations of Connecticut State Agencies requires agencies
to consider the following factors when awarding a contract which is subject to contract
VII. SELECTION PROCESS AND SCHEDULE
Request for Proposals and Response Phase
|March 21, 1997||Release of RFP by OSC|
|April 4, 1997||Questions due at OSC|
|April 7-11, 1997||OSC answers questions received|
|April 18, 1997||Proposals due at OSC|
Review and Selection Schedule
|April 21-25, 1997||Reading and Scoring or Proposals by Screening Committee|
|April 28-May 2, 1997||Finalist Interviews1|
|May 2, 1997||Insurer Selection2|
1 Finalist will be expected to make a presentation, followed by a question and answer period, to the State Comptroller and certain members of her staff at OSC Offices in Hartford, Connecticut. The number of finalists to be selected for interviews has yet to be determined; however, the expectation is that this number will not exceed three.
2 Selection of the insurer is expressly conditioned upon a site visit by up to three OSC representatives, to be conducted at a mutually agreeable date and time. All expenses incurred by OSC in making the site visit shall be borne exclusively by the insurer and treated as a cost of responding to this RFP.
VIII. Instructions to Contractors
Conformance - All responses to this RFP must conform to these instructions. Failure to conform may be considered appropriate cause for rejection of the response.
Delivery of Responses - RFP responses must be in sealed envelopes upon which a clear indication has been made of the RFP reference title, as well as the date and time the proposal is due. The name and address of the vendor must appear on the envelope. FAX responses are not acceptable.
Structure of Response - Contractors must structure the responses as outlined in this RFP.
Exclusion of Taxes from Prices - The State of Connecticut is exempt from the payment of excise, transportation, and sales taxes imposed by the Federal Government and the State. Such taxes must be excluded from quoted prices. The insurer selected may, however, be obligated to pay a premium tax on one or more of the state's accounts pursuant to Connecticut General Statutes, Section 12-202.
Signature and Responsible Persons - The proposal must be signed by an authorized official. The proposal must also provide name, title, address, and telephone number for individuals with authority to negotiate and contractually bind the contractor, and for those who may be contacted for the purpose of clarifying the information provided.
Insurers' Conference - There will be no conference.
IX. Terms and Conditions
Any insurer responding to this RFP must be willing to adhere to the following conditions and must so state in its submission:
X. Evaluation of Proposals
Each proposal will be evaluated by a Screening Committee using the criteria set forth below to determine which insurer is most capable of implementing OSC's requirements; as referenced in Section VII of this RFP, the Screening Committee's task is to identify three finalists for consideration by the State Comptroller.
XI. Rights Reserved to OSC
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