Our Beliefs

RespectCollaborationExcellenceIntegrityCommunity

Destination: 2011 Enrollment

The Road to Enrollment

Healthcare Environment is Changing How Our New Medical Plans Stack Up Cost Sharing Turbo Charge Your Health:

The Value of Your Health & Wellness Resources

Roadmap for What’s New for 2011 Your Options for 2011 Navigating Open Enrollment Questions?

2

Staying on Track

Improve the health of our employees

Control costs Educate/communicate Provide a competitive

benefit program

3

Global Health Care Strategy

Healthcare Environment is Changing

Health Care Reform has become law Called Patient Protection and Affordable Care Act (PPACA)

Health care cost increases are higher than normal Our goal was to comply with the law, while minimizing

financial impact on employees Our approach: redesign the medical plans into two new

HRA-based plans Enables BorgWarner to continue to offer a $0 contribution plan (when

both premium discounts are applied) No changes to price tags for other benefits – RX and Dental/Vision Provides employees with competitive benefits; lower employee

contributions than national average

Will walk through new medical plans shortly

How Our New Medical Plans Stack Up

Our new medical designs provide great value and are priced below market when compared to competitor plans Changes help offset additional costs of Health Care

Reform; keeping with 80/20 cost sharing goal

5*2011 Hewitt national average vs. BW Buy-Up family contribution

23% of annual premium 14%

Copay, Coinsurance, & Deductible Sharing

Average cost share based upon medical and Rx spend for 2010, trended for 2011 – Does NOT include contributions (slide 5)

BorgWarner share appx 80%Employee share appx 20%

Although the Health Care cost pie is larger, your slice of the pie will be the same

National Average

Partnering for a Healthier Workforce

BorgWarner continues to strengthen its investment in employee health by: Rewarding you for leading a healthier lifestyle

Giving free access to wellness resources and programs to promote healthy living

Providing valued cost comparison tools that give you more control in how your HRA dollars are used

7

Turbo Charge Your Health

Value of Your Health and Wellness Resources Available to you and your family members who are

involved in CIGNA medical or dental program No cost to you Your privacy is protected

Managed through third-party No individual data or results are shared with BorgWarner All information protected in accordance with state and federal

privacy laws No negative consequences; benefits won’t be cancelled and

rates will not increase because of your participation or results

Voluntary participation

8

Your CIGNA Wellness Programs

9

My Health & Wellness Center

Your own private portal Password protected Confidential

Centralized tools in convenient, easy-to-navigate web page

Relevant and trustworthy health and medical information

www.mycigna.com

Recap

Health Assessment I Nutrition I Stress I Physical Activity I Sleep

10

Tobacco Cessation I Weight Management I Stress Management

Program Overview Evidence-based, using behavior modification CIGNA HRQ outreach phone call or self-enrollment Telephonic support through dedicated wellness

coaches, or on-line behavior change programs Long-term follow-up Coordination with other programs/services 24/7/365 access

CIGNA Lifestyle Management Programs

GET STARTED!

Call 1-866-417-7848 or visit www.mycigna.com > My Health tab> Health Resources tab> Lifestyle Mgmt Programs

Recap

11

CIGNA Health Advisor

Program Overview Team of professional coaches

Registered nurses/Behavioral Health Clinicians/Health Educators/Nutritionists

Reach out to members “at risk” for significant health issues (based on HRQ results)

Offer coaching/resources to prevent chronic conditions

Your HRQ report may include suggestions on certain 8-week programs that would be helpful for you.

GET STARTED!

Call 1-800-244-6224

Recap

Health Assessment I Nutrition I Stress I Physical Activity I Sleep

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CIGNA Well Aware

Program Overview Helps you manage a chronic condition 24/7 telephone access to nurses who specialize in your

condition Work together to design a personalized action plan

under your doctor’s guidance Provide educational materials, reminders of important

tests/exams, self-care info and more

Asthma I Diabetes I Heart Disease I Low Back Pain I COPD I Other

Recap

GET STARTED!

1-866-797-5833 or visit www.mycigna.com13

Your Aetna Wellness Programs

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Aetna Navigator® Member Web Site

Health Assessment I HRA Activity I Cost I Quality I Claims

Your own private portal Password protected Confidential

Centralized tools in convenient, easy-to-navigate web page

Helps you manage your benefits

GET STARTED!

www.aetna.com

Recap

15

Simple Steps to a Healthier Life®

Program Overview Online lifestyle management to help you improve your

health or fine-tune daily habits Starts with online health assessment Based on results, select from numerous online wellness

programs to fit your goals Access to interactive tools

Nutrition I Physical Activity I Stress I And More

Recap

GET STARTED!

www.aetna.com16

Tobacco Cessation I Weight Mgmt I Stress Mgmt I Nutrition I Exercise

Program Overview Evidence-based, using behavior modification Contacted by Aetna HRQ outreach phone call Telephonic support through dedicated wellness coaches

with on-line behavior modification programs Long-term follow-up Coordination with other programs/services Convenient hours offered day or evening, Mon-Sat

Aetna Healthy Lifestyle Coaching Programs

GET STARTED!

Call 1-800-650-2747 or visit the Aetna Navigator web site:

www.aetna.com

Recap

17

Aetna Disease Management

Asthma I Diabetes I Heart Disease I Low Back Pain I COPD I Other

Program Overview Helps you manage a chronic condition 24/7 telephone access to nurses and clinicians who

specialize in your condition Work together to design a personalized action plan

under your doctor’s guidance Provide educational materials, reminders of important

tests/exams, self-care info and more Nurse case management if you are high risk

GET STARTED!Call 1-800-650-2747 or visit the Aetna Navigator web site:www.aetna.com

Recap

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The Value of Taking the HRQ

It protects you It’s confidential Put’s you in the driver’s

seat Gives you invaluable

insight to act on No negative

consequences You earn $50 off your

monthly premium

And it could save your life…

www.mycigna.com

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Connecting You to the Right Resources

To help ensure members gain access to the most relevant resources and programs, HRQ results are shared by CIGNA/Aetna with nurse practitioner

If “at risk for” or already diagnosed with chronic condition, members may receive a call from a nurse inviting them to participate in select programs

You decide whether or not to participate

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Your Roadmap to What’s New for

2011

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Extended Dependent Eligibility

Currently Can cover unmarried

children under age 19 Or under age 25 if:

he/she is a full-time student OR

permanently and totally disabled

For 2011 Can cover children up

to age 26

Regardless of: If the child lives at home Is listed as a dependent

on your tax return Is a student Is married

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Special enrollment period that runs 30 days from date you received your enrollment packet (or end of annual enrollment, whichever is later) Enroll your children who lost eligibility because of their

full-time student status or their age changed. Enroll any of your children under age 26 who were

previously denied enrollment or who were ineligible to enroll because of age.

Coverage begins January 1, 2011

Extended Dependent Eligibility continued

What This Means to You/Action to Take

Adding a dependent? Complete the “Eligibility” section of your form and provide birth certificate as proof of dependency.

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Extended Dependent Eligibility continued

Eligible dependents* will now include: Your spouse—defined as your lawful spouse

Co-habitants, common-law marriages, legally separated individuals, life partners or divorced spouses are not eligible.

Your children up to age 26, regardless of whether the child is living at home, is listed as a dependent on your tax return, is a student or is married.

A child is defined as: Biological child; Legally adopted child or a child who has been placed with you

for adoption; Stepchild who lives with you. (Restrictions may apply). Court-appointed child for whom you have full (not limited) legal

guardianship; or A child for whom you are required to provide health care support

under a Qualified Medical Child Support Order (QMCSO).

* Dependent eligibility varies for life insurance.

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Extended Dependent Eligibility continued

Working Spouse Rule If spouse is offered a plan through their employer they must

enroll in their employer’s plan in order to be eligible as a dependent under BorgWarner coverage Self-employed spouses with no medical plan available do not apply

Coordination of Benefits If you and spouse are BOTH eligible for employer-provided

medical coverage you may be able to enroll in both, but carefully consider this option

May have to pay premiums for each; to BorgWarner and spouse’s employer

Our policy is total reimbursement from both plans cannot be more than allowable benefit under the BorgWarner plan

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OTCs & FSA Reimbursements

Currently Over-the-Counter

(OTC) medicines and medical items can be paid for using FSA $$

For 2011 OTC medicines

cannot be paid for using FSA $$ UNLESS you have a prescription for them

Can still use FSA dollars WITHOUT prescription for: Medical equipment Medical supplies Diagnostic devices

For complete and up-to-date list of eligible expenses, visit: www.mycigna.com

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OTCs & FSA Reimbursements

EXAMPLES ofOTC Items that

Are Still Reimbursable

Adhesive bandages Braces and supports Contact lens solution/supplies Diagnostic tests and monitors Insulin and diabetic supplies Reading glasses And more…

EXAMPLES of

OTC Medicines No Longer Reimbursable (unless with a prescription)

Allergy and sinus Cough, cold and flu Pain relief Respiratory treatments And more…

What This Means to You/Actions to Take • After Jan 1, 2011 you can still be reimbursed for these items purchased in

2010, using 2010 funds, by submitting an FSA Claim along with the 2010 dated receipts by March 31, 2011

• Eligible expenses are subject to change. Contact CIGNA for most recent and most comprehensive list: www.mycigna.com

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Plan Limit Changes

HRA fund rollovers will be limited to: Employee: $3,000 Family: $6,000 (Note: This cap aligns with the medical plan out-of-pocket maximum so no one is “losing” money due to this cap)

HRA funds remaining at end of 2010 will rollover and follow you into your new medical plan

To comply with Health Care Reform, chiropractic benefit limits changing from a dollar limit (cap) to maximum of 12 visits per calendar year

Medical plans will now consider bariatric surgery an eligible expense if meeting specific criteria.Contact CIGNA or Aetna directly for details

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Medical Plan Redesign

Currently You have 3 options

Choice Health Fund 1 Choice Health Fund 2 POS Plan

For 2011 You have 2 options:

Basic Plan ($0 plan) Buy-Up Plan

What This Means to You/Action to Take• All employees must make new medical election for 2011

• Still have opportunity for $0 contribution (Basic Plan)

• Carefully evaluate which plan is right for you using online tools

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A Look at the New Medical Plans

Both of the new plans: Provide free preventive care coverage Have a BorgWarner-paid Health Reimbursement

Account (HRA) as your first source of payment for medical costs

Comprehensive financial coverage to protect from serious illness/injury

Same comprehensive prescription drug coverage as last year

They differ in the way you pay your portion of the costs

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How the Plans Work

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Comparing the Plans

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In-Network Benefits

Basic Plan Buy-Up Plan

Employee Family Employee Family

Preventive 100% 100%

Plan Deductible $1,500 / $3,000 $1,500 / $3,000

BW-Funded HRA $500 / $1,000 $750 / $1,500

Member Deductible Gap $1,000 / $2,000 $750 / $1,500

Coinsurance 20% 10%

Copay No copays No copays

NET Out-of-Pocket Max $3,000 / $6,000 $3,000 / $6,000

* Out of Network is 2x In-Network level

Comparing the Plans: Family Coverage

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You pay $0 in annual payroll contribution

(assumes both premium discounts met)

You pay $1,440 in annual payroll contribution

(assumes both premium discounts met)

Comparing the Plans continued

Basic Plan $0 in payroll

contribution Lower HRA Higher deductible

gap Higher coinsurance

requirement (20%)

Buy-Up Plan Higher payroll

contribution Higher HRA Lower deductible

gap Lower coinsurance

requirement (10%)

Your Bottom line…

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Trouble Choosing a Medical Plan?

Try CIGNA’s/Aetna’s plan selector and cost estimator tools Estimate how much you will use covered services,

such as doctors’ visits, specialty care, Rx, etc. Calculate the approximate cost of care Compare medical plans based on estimated out-of-

pocket costs, payroll deductions and BorgWarner contributions

GET STARTED!

Visit www.borgwarner.com/benefits Click on “Medical Plan Selector” link on left of page 35

Premium Discounts

HRQ Pledge Complete pledge by

Nov. 12, 2010 Take HRQ online or

through onsite health clinic by November 30

$50 monthly premium applied January 2011

If completed after deadline, applied within 30 days

Tobacco Cessation Pledge Complete pledge by

Nov. 12, 2010 If required, complete

program by February 28, 2011 Otherwise premium will return to

regular rate as of April 1, 2011

Must use CIGNA Quit Today program or other HR-approved program

$50 monthly premium applied Jan. 1, 2011

The premium discount program will continue for 2011

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Impact of Discount on Costs

2011 Medical Contributions

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Your 2011 Benefit Options

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Your Benefit Options

Medical Dental/Vision Flexible Spending Accounts (FSAs) Life and Disability Insurance

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Medical Plan Options

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Prescription Drug Plan

In-Network BenefitRetail

(30-day supply)Mail Order

(90-day supply)

Generic

Diabetes Generic Medications

$8 copay

$0 copay

$16 copay

$0 copay

Brand Formulary $8 + 30% 30% to $150 max.

Brand Non-Formulary $8 + 50% 50% no max.

Specialty Pharmacy

Brand Formulary 30% to $50 max. 30% to $150 max.

Brand Non-Formulary 50% to $100 max. 50% to $300 max.

For both medical plans:

Same as last year!

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Dental/Vision – Combined Benefit

Dental Checkups Fillings Braces

Vision Eye exams Glasses or contacts Go to www.mycigna.com

then click on CIGNA Vision for vision directory

2011 Monthly Cost Share

Dental/ Vision

Employee Only $15

Employee +1 $30

Family $45

Choose pre-tax or after-tax contributions

Same as last year!

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Flexible Spending Accounts

Health Care FSA (HCFSA)or Dependent Care FSA (DCFSA)

Employee-funded with pre-tax dollars You make tax-free contributions You get tax-free reimbursements Full amount available Jan 1 (HCFSA) Use HCFSA fund for your member deductible gap You must enroll every year Federal rule says year-end balance

forfeited if not used by next March 15 for HCFSA, December 31 for DCFSA

Have until March 31 to submit claims

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Flexible Spending Accounts continued

How claims are paid Health care services received January, 2011-March 15, 2012 Have until March 31, 2012 to file 2011 claims Regardless of FSA auto-forwarding selection, order of

reimbursement for deductibles, coinsurance, and co-pays for will be:

1st - Remaining FSA balance from prior year

2nd - HRA fund

3rd - FSA current year

Reimbursement options Direct deposit – go on-line to enroll at www.mycigna.com, or call

customer service at 1-800-244-6224 Check – default method

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Long-Term Disability

Design LTD 60% Option LTD 70% Option

Benefit Level 60% of annual earnings 70% of annual earnings

(including average of past three years of bonus pay)

Taxation of LTD Benefit

100% taxable Only the portion of the benefit BW pays for is taxable

MINIMIZES YOUR TAX BURDEN

Income Replacement

Lower Higher

Premium BW Paid Employee Paid

Long-Term Disability Options

Use online LTD calculator to calculate your contribution for each option and decide which option is right for you: www.borgwarner.com/benefits

Benefits Paid by BorgWarner

Basic Life Provided directly through MetLife: www.Metlife.com/mybenefits Provides financial protection for your survivors in event of your death

while employed at BorgWarner Benefit is equal to the amount of your annual base pay Minimum of $25,000 to maximum of $500,000

AD&D Accidental death or dismemberment benefit: 1 times annual base pay

up to $500,000

Business Travel Accident & Medical Insurance Only applies to company-approved travel for BorgWarner Provided through CIGNA this coverage combines global accident

coverage with international medical protection Refer to online Benefits Reference Guide for details

46

Optional Life Insurance

Employee pays cost Offered directly through MetLife

www.Metlife.com/mybenefits

Coverage options include: Employee Life:

1 times annual base pay up to 8 times base pay Spouse Optional Life:

$5,000/$10,000/$25,000/$50,000/$150,000/$250,000 Child Dependent Life:

$5,000/$10,000/$15,000/$20,000

No “guaranteed coverage” during open enrollment Subject to Evidence of Insurability (EOI)

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Additional Points of Interest

Navigating Enrollment

48

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Roadside Assistance

Check out inside cover of your Enrollment Guide

Roadside Assistance

www.BorgWarner.com/benefits

2011 Benefits Enrollment

50

Mandatory enrollment by November 12 Make sure to fully complete the Premium Discount

section of your enrollment form Choose a new medical plan: Basic Plan or Buy-Up Plan

or Opt Out Contact MetLife directly to make changes to life

insurance at www.metlife.com/mybenefits or 1-888-622-6616

New medical ID cards issued in late December Benefits take effect January 1, 2011

Key Items to Remember

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Your Destination: 2011 Enrollment

Enroll by November 12

52

Optional Slides

CIGNA Quit Today

CIGNA Quit Today®

Two 8-week program options: Telephonic Coaching Online Web-based Program

Coach credentials – minimum BS in psychology, nursing, counseling, health education

Support lines available in English and Spanish Program includes:

Toolkits Free Nicotine replacements – OTC patch/gum

Participate as many times as necessary to obtain success

85% of

participants QUIT

after 6 months

85% of

participants QUIT

after 6 months

Recap

CIGNA Quit Today

Convenient and secure online registration at www.CIGNAbehavioral.com

A 2-week “Planning to Quit” and 6-week “Quit for Good” module

E-mails and online articles Key learning themes, motivational

information, and tips Ability to contact a wellness coach

via telephone Outcome surveys at 30 days,

6 months, and 12 months post-completion

Web-based ProgramRecap

CIGNA Quit Today continued

Telephonic Coaching Toll free one-on-one coaching sessions with

a dedicated wellness coach at:

1-866-417-7848 Based on readiness to change, motivation,

confidence, tobacco usage, support system Available evenings and weekends Reviews health status, risk factors, and co-

morbidities Develops a personalized quit plan

Support line 7 days a week, 24 hours a day Follow-up and long term support post-

graduation

Recap

CIGNA Quit Today continued

Tobacco Cessation Drug Aids via CIGNA Pharmacy and Aetna Pharmacy

Through the Quit Today® program certain drugs can be covered under the CIGNA or Aetna Pharmacy: Nicotine inhibitor and certain anti-depressants $0 copay, limited to 1x per year If a second attempt is needed, you can still receive refills

under your normal co-insurance share.

Free Nicotine Replacements – OTC patch or gum –

Available only through Quit Today®Not available through CIGNA or Aetna Pharmacy

Recap

HRQ

Two methods: Online: www.mycigna.com Or go to your onsite clinic

and participate in their health screening process

Accessing The HRQ: Log onto

www.mycigna.com and go to ‘My Health’ tab

New users register by following prompts

Return users – login

Recap

HRQ continued

My Health and Wellness Center Centralizes tools in convenient, easy-to-navigate page on

www.mycigna.com

The member’s journey begins when they take my health assessment questionnaire (HRQ)

Recap

HRQ continued

Brief, easy-to-understand survey 65 questions, averaging 10-15 minutes Identifies health risk across biometric,

psychological and behavior measures

my health assessment

•Alcohol

•Blood pressure

•Body weight/Body mass index

•Cholesterol

•Existing medical conditions

•Health age index

•Illness days

•Job satisfaction

•Life satisfaction

•Medication for relaxation

•Perceived health

•Physical activity

•Safety belt usage

•Smoking

•Stress

Call-outs help define questions, helping to ensure accurate responses

Productivity question set utilizes WHO Health and Work Performance Questionnaire (HPQ) developed by R.C. Kessler at the Harvard Medical School

Recap

HRQ continued

Recap

Tobacco Cessation Premium Discount

Earn $50/month tobacco cessation discount Encourages healthy living and rewards positive behavior

How it works Complete the Tobacco Cessation Pledge on your enrollment

form and submit it by Nov 12, 2010; effective Jan 1st If you pledge to complete the Tobacco Cessation Program,

you must do so by Feb 28, 2011; if not you forfeit the discount starting April 1, 2011

Eligible tobacco cessation program includes: The CIGNA Quit Today® Program Program pre-approved by your HR Department

Recap

Tobacco Cessation Program Offers resources and tools to help tobacco users quit

tobacco before they develop chronic conditions Available to all employees and dependents age 18 or

older who are CIGNA or Aetna members Provide assistance to quit through:

Quit Today® - tobacco cessation drugs (with annual cap) and free counseling services

$150 annual reimbursement on acupuncture and hypnosis

Excellent resource to help those interested in earning one of the medical premium discounts

Recap

Tobacco Cessation Premium Discount

Which Plan May be Right for You?

64

If you expect total claims between $12k-$34k, Buy Up plan beneficial Contribution Gap

Family Options

Basic Plan

Buy Up Plan

HR Slide

Which Plan May be Right for You?

65

If you expect total claims between $4k-$19k, Buy Up plan beneficial

Contribution Gap

Employee Only Options

Basic Plan

Buy Up Plan

HR Slide

Building Your HRA

• Your HRA and member deductible gap combine to make the plan deductible

• If you have money remaining in HRA at year end it rolls over for next year’s use

• That means you have the BW annual HRA contribution + rollover dollars; growing your total HRA balance

• The higher your HRA balance the lower your member deductible gap

Rollover dollars from current plans will follow you to new plans

Comparison of 2010 to 2011 Plans - Contribution

67

Choice Health Fund 1

Basic Plan

Employee Family Employee Family

Mthly Contribution $0 $0 $0 $0

Deductible $1500 $3000 $1500 $3000

HRA $750 $1500 $500 $1000

Net Deductible $750 $1500 $1000 $2000

Coinsurance 80% 80% 80% 80%

Choice Health Fund 2

Buy Up Plan

Employee Family Employee Family

Mthly Contribution $35 $95 $40 $120

Deductible $1000 $2000 $1500 $3000

HRA $500 $1000 $750 $1500

Net Deductible $500 $1000 $750 $1500

Coinsurance 80% 80% 90% 90%

2011 plans

have same net out of

pocket max and

preventive benefit

as 2010

Comparison of 2010 to 2011 Plans - HRA

68

Choice Health Fund 1

Buy Up Plan

Employee Family Employee Family

Mthly Contribution $0 $0 $40 $120

Deductible $1500 $3000 $1500 $3000

HRA $750 $1500 $750 $1500

Net Deductible $750 $1500 $750 $1500

Coinsurance 80% 80% 90% 90%

Choice Health Fund 2

Basic Plan

Employee Family Employee Family

Mthly Contribution $35 $95 $0 $0

Deductible $1000 $2000 $1500 $3000

HRA $500 $1000 $500 $1000

Net Deductible $500 $1000 $1000 $2000

Coinsurance 80% 80% 80% 80%

2011 plans

have same net out of

pocket max and

preventive benefit

as 2010

Comparing the Plans: Employee Only Coverage

69