Alcoa terminates life insurance policies for retirees
MASSENA, N.Y. (WWNY) - Alcoa is terminating life insurance policies for its retirees. And there will be other changes ahead.
Thousands of Alcoa retirees received letters this month. Not holiday greetings, but a letter telling them their Alcoa-provided life insurance policies are ending.
“Alcoa strikes again," said Ronald Greenleaf, Alcoa retiree. "They all got the same feeling that we're getting shafted. What they're offering to pay us is only 20 percent of face value. So we're losing.”
With the letter they are getting checks. But the letter contains a bold-face warning: cash the check and you're waiving all claims for life insurance from Alcoa.
“Some of them have already spent it, cashed it. Most of them are keeping it. We've been advised not to. That the union is going to look into it,” said Greenleaf.
Alcoa says it's cutting checks for about $15 million for almost 9,000 retirees. In a statement issued in response to 7 News, Alcoa says the checks “are being provided voluntarily by Alcoa and can be used for any purpose.”
In early December, Alcoa said ending the life insurance coverage is part of a larger strategy that should cut its retirement liabilities by about $190 million. The company says the decision to end the life insurance was “difficult.” But that changes are “necessary to improve Alcoa for the long term.”
For the most part, they are small policies, about enough to cover funeral expenses. But employees can have several.
This termination of life insurance isn't the last change current Alcoa retirees will see. They'll also be told that in the future they'll have to go to the Medicare Exchange to obtain some of their health benefits.
That change will take place at the beginning of 2021. But Alcoa says it will be providing retirees with information much earlier than that on how to make the change.
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