§ 27-4-22.1 - Continuation of group life insurance – Labor disputes – Involuntary layoffs.
SECTION 27-4-22.1
§ 27-4-22.1 Continuation of group lifeinsurance – Labor disputes – Involuntary layoffs. – (a) No group life insurance policy shall be issued or delivered in this statewhere the premium or any part of the premium is paid or is to be paid in wholeor in part by an employer pursuant to the terms of a collective bargainingagreement unless the policy provides that in the event of a cessation of workby the employees covered by the policy as the result of a labor dispute orinvoluntary layoff, the policy, upon timely payment of the premium, shallcontinue in effect with respect to all employees insured by the policy on thedate of the cessation of work who continue to pay their individual contributionand who assume and pay the contribution from the employer, for the period ofcessation of work, under the following conditions:
(1) If the policyholder is not a trustee or the trustees of afund established or maintained in whole or in part by the employer, the policyshall provide that the employee's individual contribution shall be the rate inthe policy, on the date cessation of work occurs, applicable to an individualin the class to which the employee belongs as set forth in the policy;
(2) If the policyholder is a trustee or the trustees of afund established or maintained in whole or in part by the employer, theemployee's contribution shall be the amount which he or she and the employerwould have been required to contribute to the trust for the employee if (i) thecessation of work had not occurred and (ii) the agreement requiring theemployer to make contributions to the trust were in full force;
(3) The policy may provide that the continuation of insuranceis contingent upon the collection of individual contributions by the union orunions representing the employees for policies referred to in subdivision(a)(1), and by the policyholder or the policyholder's agent with respect topolicies referred to in subdivision (a)(2);
(4) The policy may provide that the continuation of insuranceon each employee is contingent upon timely payment of contributions by theindividual and timely payment of the premium by the entity responsible forcollecting the individual contributions;
(5) The policy may provide that each individual premium rateshall be increased by an amount up to six percent (6%) of the premium rate ofthat shown in the policy during the cessation of work in order to coverincreased administrative costs and increased mortality and morbidity. If thepolicy does provide for an increase, this shall have the effect of increasingthe employee's contribution by a similar percent;
(6) Nothing in this section shall be deemed to limit anyright which the insurer may have in accordance with the terms of the policy toincrease or decrease the premium rates before, during, or after a cessation ofwork if, in fact, the insurer would have had the right to increase the premiumrate had the cessation of work not occurred. If this premium rate change ismade, it shall be effective, notwithstanding any other provisions of thissection, on a date the insurer shall determine in accordance with the terms ofthe policy;
(7) The policy may provide that, if a premium is unpaid atthe date of cessation of work and the premium became due prior to the cessationof work, the continuation of insurance is contingent upon payment of thepremium prior to the date the next premium becomes due under the terms of thepolicy; and
(8) Nothing contained in this section shall be deemed torequire continuation of any group life insurance policy unless or until thegreater of (i) one hundred (100) employees and (ii) at least fifty-one percent(51%) of the employees in the group eligible to continue the coverage underthis section satisfy all of the requirements to do so.
(b) No individual employee shall be eligible to continuecoverage under this section after he or she becomes employed full time with thesame or any other employer.