ADJUDICATION SERVICES CONTRACT. For SHORT TERM AND LONG TERM DISABILITY BENEFITS PROGRAMS. Plan Nos & 74286

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1 ADJUDICATION SERVICES CONTRACT For SHORT TERM AND LONG TERM DISABILITY BENEFITS PROGRAMS Plan Nos & THIS CONTRACT made as of November 27, 2008 BETWEEN: CITY OF THUNDER BAY (the Plan Sponsor) - and - THE MANUFACTURERS LIFE INSURANCE COMPANY (the Administrator)

2 Since the Plan Sponsor has designed and established Short Term Disability Benefits and Long term Disability Programs (the Plan) as described in the Benefits Contract, since the Plan Sponsor is authorized to enter into this Contract for the purpose of delegating certain of its authorities, rights and duties under the Plan to an administrator; and, since the Plan Sponsor desires the Administrator to provide adjudication services with respect to the Plan and the Administrator is willing to do so pursuant to the terms of this Contract; therefore, in consideration of the premises and of the mutual obligations and agreements set forth in this Contract, the Plan Sponsor and the Administrator agree as follows: 1. PLAN DOCUMENT Wherever in this Contract reference is made to the term "Plan Document" it shall mean the Benefits Contract. 2. SERVICES TO BE PROVIDED BY THE ADMINISTRATOR The Plan Sponsor hereby appoints the Administrator to perform certain services in relation to the operation of the Plan and the Administrator hereby accepts such appointment. The services of the Administrator shall be limited to the services as set forth in Appendix A to this Contract. Other responsibilities of the Administrator are described in Section 3 below. 3. CERTAIN RESPONSIBILITIES OF THE ADMINISTRATOR AND PLAN SPONSOR i) The Plan Sponsor retains all final authority and responsibility for the Plan and its operation and the Administrator is empowered to act on behalf of the Plan Sponsor in connection with the Plan only as expressly stated in this Contract or as mutually agreed to in writing by the Administrator and the Plan Sponsor. The Administrator, in performing its obligations under this Contract with respect to third parties including representatives of the Plan Sponsor, is acting only as an agent of the Plan Sponsor and the rights and responsibilities of the parties shall be determined in accordance with the law of agency. ii) iii) iv) Upon the Administrator becoming aware of any potential legal actions involving the Plan, the Administrator shall advise the Plan Sponsor of such potential action. Additionally, the Administrator shall promptly advise the Plan Sponsor of legal actions commenced against the Plan Sponsor which come to its attention. The defence of any legal action involving a claim for benefits under the Plan shall not be the obligation of the Administrator under this Contract; but, the Administrator shall fully co-operate with the Plan Sponsor in the defence of any action arising out of matters related to this Contract, subject to reimbursement for expenses. The Plan Sponsor shall, to the extent possible, advise the Administrator regarding matters which come to its attention involving potential legal actions involving the Plan. The Administrator shall use care and due diligence in the exercise of its powers and the performance of its duties as Administrator and shall retain liability and indemnify the Plan Sponsor and hold the Plan Sponsor harmless against any and all losses, including punitive, aggravated and exemplary damages and expenses, including but not limited to City of Thunder Bay 1

3 court costs and lawyer's fees, resulting from and arising out of claims, demands or law suits brought against the Plan Sponsor for any wilful misappropriation or conversion and for negligence on the part of any employee or agent of the Administrator. However, in no event shall the Administrator be responsible for the payments under the Plan. The Plan Sponsor shall assume full liability for same and damages arising there from. v) Except as provided in (iv) above, the Plan Sponsor agrees to reimburse and indemnify the Administrator and hold the Administrator harmless against any and all losses, including punitive, aggravated and exemplary damages and expenses, including but not limited to court costs and lawyer's fees, resulting from and arising out of claims, demands or law suits brought against the Administrator in administering the Plan or to recover benefits under this Plan or in the negotiation of or consideration of settlement. vi) vii) viii) Since the Plan Sponsor is responsible for the actual benefit payments from Plan Sponsor funds, it will be the Plan Sponsor s responsibility to take reasonable steps to recover either an overpayment or a payment of benefits for an ineligible person under the Plan; any legal action including court proceedings shall be taken and underwritten by the Plan Sponsor. Determination of disability under the Plan shall be made in accordance with the Administrator s interpretation of the Plan provided that the Plan Sponsor may authorize and pay or deny a claim contrary to the usual interpretation applied by the Administrator. The Plan Sponsor shall assume full and sole responsibility for any claim, demand or lawsuit brought against the Administrator as a result of payment or denial of any claim pursuant to such authorization or direction by the Plan Sponsor. The Administrator shall not be responsible for any claim, demand or lawsuit brought against the Administrator for any loss that is the result of negligence or willful misconduct by the Plan Sponsor. 4. DUTIES OF THE PLAN SPONSOR The Administrator shall be responsible for those services set out in Appendix A to this contract and for those duties and responsibilities ascribed to in Section 3 above. The Plan Sponsor shall be responsible for fulfilling all other responsibilities with respect to the Plan including those set out in Appendix B. 5. EFFECTIVE DATE/PLAN PERIOD i) This Contract shall commence as of November 1, 2008 and shall continue until June 30, ii) iii) This Contract shall be renewed automatically, for successive 1 year periods (July 1 st to June 30 th ), unless terminated in accordance with paragraph 9 of this Contract. The final Plan period shall be the period from the end of the last completed 12 month period up to the date of termination and shall include any benefit payments made in accordance with paragraph 9 of this Contract. City of Thunder Bay 2

4 6. COMMUNICATIONS Notices or communications from/to the Plan Sponsor to/from the Administrator shall be deemed given or served, if sent by post office mail, on the third day following the day of posting or if sent by courier, , FAX, or other similar or analogous means, on the day of such personal service, to the address shown below, unless requested to send such communications to another address: To the Administrator: To the Plan Sponsor: Manulife Financial Group Benefits City of Thunder Bay 1445 Portage Avenue 141 May Street Suite 620 Winnipeg, Manitoba Thunder Bay, Ontario R3G 3P4 P7E 1A9 7. FUNDING ARRANGEMENTS As the Administrator is not responsible for benefit payments, funding arrangements are not required with respect to benefits. 8. SERVICE CHARGES The Administrator shall calculate the fees to be paid by the Plan Sponsor, as set out in Appendix C, and shall bill the Plan Sponsor on a monthly basis for services rendered in the prior month. The Plan Sponsor will reimburse the Administrator for the amount of any taxes that the Administrator is required to pay pursuant to the demand of an appropriate government official for any taxes based on or deriving from the service fees under the Plan. In the event this Contract terminates on a date other than the first day of any Plan period, annual service charges for the Plan period in which this Contract terminates shall be prorated. 9. TERMINATION OF CONTRACT i) The Plan Sponsor or the Administrator may terminate this Contract upon giving the other party 60 days written notice of its intention to do so. Additionally, this Contract may be terminated at the earliest time specified below: (a) (b) In the event a party breaches any of its material obligations here under, including the Plan Sponsor s obligation to make any required payments to the Administrator, the other party may immediately terminate this contract, if such breach is not rectified within 5 days of receipt of notice of the breach. As of the date any applicable jurisdiction enacts a law or interprets an existing law so as to prohibit the continuance of this Contract. ii) iii) Termination of this Contract shall not terminate the rights or liabilities of either party arising out of a period prior to such termination. Upon termination of this Contract due to discontinuance of the Plan, the Administrator will cease the claims adjudication of all claims regardless of when the claim was incurred. City of Thunder Bay 3

5 iv) Upon termination of this Contract in a case where the Plan continues in force, all services provided by the Administrator shall cease. Upon the request of the Plan Sponsor, the Administrator will complete the processing of all requests for claims adjudication under the Plan, information as to which has been received by the Administrator prior to the date of termination, under the terms and conditions that would be applicable if this Contract were still otherwise in full force and effect. v) The Plan Sponsor will be liable to reimburse the Administrator for all claims adjudication performed by the Administrator within the terms of this Contract and within a reasonable time following the termination of this Contract. All claims adjudications performed by the Administrator that are outstanding upon the termination of this Contract or performed thereafter in accordance with the immediately preceding paragraphs (iii) and (iv) will continue to be the responsibility and liability of the Plan Sponsor. Service Charges will be made in accordance with paragraph 8 of this Contract. vi) Upon termination of this Contract in a case where the Plan continues in force, the Administrator agrees to provide sufficient information to the successor administrator to effectively pay benefits subject to reimbursement of the Administrator s expenses. 10. ASSIGNMENT The services to be performed by the Administrator under this Contract may, at the Administrator s discretion, be performed directly by the Administrator or wholly or in part under a contract with any organization of the Administrator s choosing, but in no event will the Administrator assign 100% of the services to be performed under this Contract. 11. APPLICABLE LAW This Contract shall be construed and enforced according to the laws of the Province of Ontario, but the services to be performed by the Administrator will be in accordance with the laws of the province in which the Plan Member resides. 12. AMENDMENTS This Contract may be amended by the parties at any time. Such amendment shall be by an amending contract or appendix agreed to between the Plan Sponsor and the Administrator. Signed at Toronto, Ontario on Signed at on for The Manufacturers Life Insurance Company for City of Thunder Bay Monique Gromek Director, Group Underwriting, Ontario Region (Name) (Title) City of Thunder Bay 4

6 APPENDIX A To Adjudication Services Contract BETWEEN: CITY OF THUNDER BAY (the Plan Sponsor) and THE MANUFACTURERS LIFE INSURANCE COMPANY (the Administrator) Services to be provided by the Administrator 1. All claims under the Plan shall be submitted to the Administrator for adjudication. The Administrator will determine the entitlement to Plan Benefits in accordance with the Plan Document and the Administrator's benefit cost control standards, procedures and practices applicable to benefits available under the Plan. 2. Whenever the Administrator determines that benefits are payable under the Plan, the Administrator shall so inform the Plan Sponsor. 3. Receipt and review of notices of claim submitted by the Plan Sponsor. Coordination of appropriate claims investigations including but not limited to discussion of claims with providers of hospital, medical, pharmacy and dental services, where appropriate. 4. Communication of all benefit decisions to the appropriate address as directed by the Plan Sponsor. 5. Maintenance of accurate and detailed records of all the gross payments that are deemed payable to Plan Members. These records shall be open at all reasonable times to inspection and audit by any person or persons designated in writing by the Plan Sponsor, provided that any examination of these records shall be carried out in a manner agreed to between the Plan Sponsor and the Administrator designed to protect the confidentiality of the Plan Members medical information, subject to reimbursement of the Administrator s expenses incurred by such audit. 6. Maintenance of this Contract including all appendices. 7. Provision of advice to the Plan Sponsor with respect to the administration and operation of the Plan. 8. Provision of suitably qualified staff to assist in the coordination of all services provided by the Administrator and in the resolution of any problems relating to such activities. 9. Preparation of reports for the Plan Sponsor as necessary 10. Attendance at meetings with the Plan Sponsor as necessary. 11. With respect to the personal records of all Plan Members and Dependents, the Administrator agrees to conform with the Quebec Privacy Act (Bill 68), the CLHIA Right to Privacy Guidelines and any other laws, regulations or guidelines concerning Privacy and Confidentiality. City of Thunder Bay 5

7 APPENDIX B To Adjudication Services Contract BETWEEN: CITY OF THUNDER BAY (the Plan Sponsor) and THE MANUFACTURERS LIFE INSURANCE COMPANY (the Administrator) Duties of the Plan Sponsor 1. The Plan Sponsor shall be responsible for payment of all benefits under the Plan and for the distribution of payment to the Plan Member. 2. The Plan Sponsor shall be responsible for certification of a claimant s eligibility for coverage as of the date the claimant ceased working. The Plan Sponsor shall be responsible for confirming eligibility at the time the claim is filed. 3. The Plan Sponsor shall provide the Administrator on a timely basis with such information as to the Plan Members covered under the Plan as will be necessary for the Administrator to determine entitlement to Plan benefits and to provide Plan cost estimates and reports as set forth in Appendix A. 4. The Plan Sponsor shall provide the Administrator with the Plan document and such other information that will enable the Administrator to determine benefits payable under the Plan. 5. The Plan Sponsor shall furnish a written notice to each Plan Member covered under the Plan, specifying that the Plan Sponsor is liable for payment of the benefits under the Plan and that such benefits are not insured or payable by the Administrator. The Plan Sponsor agrees to reimburse and indemnify the Administrator and hold the Administrator harmless against any and all losses, including punitive, aggravated and exemplary damages and expenses, resulting from and arising out of any failure by the Plan Sponsor to provide such notice. 6. The Plan Sponsor shall pay all disbursements as incurred by the adjudicator. 7. With respect to the personal records of all Plan Members and Dependents, the Plan Sponsor agrees to conform with the Quebec Privacy Act (Bill 68), the CLHIA Right to Privacy Guidelines and any other laws, regulations or guidelines concerning Privacy and Confidentiality. City of Thunder Bay 6

8 APPENDIX C To Adjudication Services Contract BETWEEN: CITY OF THUNDER BAY (the Plan Sponsor) and THE MANUFACTURERS LIFE INSURANCE COMPANY (the Administrator) Service Charges Expenses for each statement include: 1. Claims Adjudication Charge - Adjudication Services Only Short Term Disability: Long Term Disability: $XXX per case $XXX per case per year 2. Rehabilitation 3. Taxes Short Term Disability: As billed plus 10% Long Term Disability: As billed plus 10% As required according to legislation 4. Legal Expense 5. Other The reasonable legal expenses incurred by the Administrator in connection with the Administration of the Group Contract Any other reasonable expenses not defined above. City of Thunder Bay 7