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Guaranteed Standard Issue (GSI)
Refer to this section if your group benefit plan includes Guaranteed Standard Issue (GSI) coverage.
GSI enrolment
Prior to enrolling an employee, confirm their eligibility. Refer to this table for enrolling new employees in a GSI class.
Is the employee a Canadian Citizen, or a Permanent Resident (landed immigrant)? If the employee answers ‘no’ to this question in the enrollment tool, it will inform them that a Foreign Contract Questionnaire is required. The employee may ignore this and proceed with the application since this questionnaire has been discontinued. Their application will continue to be directed to the GSI Underwriting area who will proceed to include a Least Restrictive travel exclusion amendment to their policy contract. In the event the member completes the FCQ after April 27th, Underwriting will disregard and proceed with a least restrictive travel amendment.
GSI portability
Employees are eligible to continue their GSI policy as a standalone individual policy. Once you terminate a plan member using Online Administration, RBC will send a letter to the prior employee and outline the payment options (monthly bank withdrawal via monthly preauthorized chequing or annual direct billing) and the premium amount due. You should inform the terminating employee that any premium discount currently on the policy is transferable to an individually paid policy.
In addition, if the insured were to leave the GSI group that is composite billed, they can maintain their policy but they will need to start paying the premium shown in their individual policy schedule.
Smoking status
If an insured’s smoking status changes, the insured may be eligible for non-smoking rates. The insured must complete the Smoking Declaration and email to gsisalessupport@rbc.com for consideration.
Layoff
Policies under your GSI Program are individual policies. Therefore, in order for the policy to remain in force, the premiums must continue to be paid. If the layoff or leave of absence is temporary, the employee should continue to pay their premiums. If the employee is unable to pay the premiums, the coverage will lapse and it will be necessary for the employee to re-apply for coverage upon return to work. As a result, there may be a change in premiums.
If the layoff is permanent, use Online Administration to terminate the employee within 14 days. If you wish to have the policy removed from your bill, please email admin@groupinsurance.rbc.com. If the policy can be maintained independently, we will contact the employee regarding the options that are available. If you wish to reinstate the employee and the employee did not maintain their GSI policy individually while laid off, they must reapply for a new GSI policy.
Paternal/maternity leave
Policies under your GSI Program are individual policies. Therefore, coverage under the policy may continue while the employee is on maternity/parental leave. In order to maintain the coverage, the premiums must continue to be paid. If the premiums are employee paid, the employee may elect to pay the premiums on their own during their maternity/parental leave, or pre-pay the premiums through your Company and remain part of your Plan.
If the premiums are company paid, they must continue to be remitted in order for the coverage to remain in force.
If the premium payments are not maintained during the maternity/parental leave, the coverage will lapse due to nonpayment. The employee would then be required to re-apply for coverage upon return to work. As a result, there may be an increase in premiums.
It is not necessary to report an employee on maternity/parental leave to RBC Insurance unless premium payments will be interrupted. If the plan member elects to opt out of coverage, have the plan member complete the Maternity/Parental Leave of Absence – Opting out of coverage form and retain this form for your records.
Sign in to Online Administration to terminate coverage. Refer to the ‘How to’ section ‘Terminate a plan member’ for detailed instructions.
Composite rate information
A composite rate is an average premium rate based on all of the coverage provided under a collection of individual policies. It can include an adjustment factor to consider changes in the composition of policies throughout the year to minimize changes in the billed premium. Composite billing is a method of premium collection and payment for employee-funded policies where an employer will collect an amount from each employee that is determined by multiplying the employee’s coverage amount by the composite rate. The employer will combine the collected amounts and use them to pay the premiums due under the policies. The composite rate is recalculated at each renewal date for the Plan, and is also recalculated when the premiums collected are insufficient to pay the premiums required by RBC Insurance or if the employer adds a division that will be covered under the composite rate.
What are the Composite Rate Guidelines?
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RBC Insurance sets guidelines regarding the calculation of composite rates. These guidelines are included in the Administrative Agreement if the Plan Administrator or TPA is calculating the composite rate.
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A “class” means a subset of insureds who share distinct occupational characteristics, such as job level or location, and whose policies are included for the purpose of determining a composite rate applicable to that subset.
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The administrator and employer will determine class structure, and the composite rate for that class is determined by adding all of the individual GSI premiums within the classes and dividing that amount by the total individual GSI coverage within the classes.
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An adjustment margin may be added to reduce the chance premium changes are needed during the year. Maximum margins are set based on the number of policies in the class. Three allowed methods of dealing with smoker premium differences are also provided.
If the Plan Administrator or TPA is calculating the composite rate, use of a trust account is required to hold premiums in excess of the amount required by RBC Insurance. The Administration Agreement describes the maximum amounts and usage of trust account funds. Funds may only be used to reduce future composite rates for members of the composite rate class where the excess premium was generated.
Third party administration
If the premium payor for the policy is the employer or a third party, it is necessary to have an employee acknowledge this in writing using the combined Group Enrollment and Guarantee Standard Issue (GSI) Program Application Form for GSI classes or the Group Enrollment Form Group-only classes. This allows you as the employer or TPA to exercise certain policy rights associated with the payment of premiums, and it allows RBC Insurance to:
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Receive and accept premium payments from the employer/TPA,
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Pay any refund premiums to the employer/TPA
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Send any premium notices or premium lapse notices to the employer/TPA
The policy owner still maintains ownership rights and is entitled to receive any benefits that may become due. Please contact RBC Insurance Customer Service for further information.