Employee Retirement Income Security Act Of 1974 (erisa)
Definition of "Employee retirement income security act of 1974 (erisa)"
Law that established rules and regulations to govern private pension plans, including vesting requirements, funding mechanisms, and general plan design and descriptions. For example, three ways of vesting were established: full vesting after 10 years of service (Cliff Vesting); five to fifteen year rule (at least 25% of benefits vest at end of 5 years of service, 5% each year during the next 5 years, and 10% each year during the next 5 years); and Rule of 45 (when employee's age and years of service add up to 45), 50% of the benefits must be vested with 10% additional vesting each year thereafter. Under the tax reform act of 1986, vesting requirements were changed to 100% vesting after 5 years of service or 20% vesting after 3 years of service, 40% at the end of 4 years of service, 60% at the end of 5 years of service, 80% at the end of 6 years of service and 100% at the end of 7 years of service. (These vesting requirements are effective as of January 1, 1989.)
Popular Insurance Terms
Frequency and severity of accidents resulting from conditions and environment surrounding one's workplace. Occupation is an important underwriting factor when considering an applicant for ...
Expenses and taxes incurred by the insurance company resulting from the normal business activities of the company before the due date of the annual statement. ...
Provision found in juvenile insurance that waives the premiums due on the insured child's policy provided that the payor of the premiums becomes totally disabled or dies before the child ...
Attachment to a property insurance policy to protect the interest of the mortgagee in the mortgaged property. If the property is damaged or destroyed, the mortgagee is indemnified up to his ...
Insurance coverage that protects the exporter (even though the exporter may be in total compliance with the terms and conditions of the contract) in the event a foreign government calls the ...
Maximum amount that an insurance company is obligated to pay all injured parties seeking recourse as the result of the occurrence of an event covered under a liability insurance pol ...
Special type of charitable remainder trust (CRT) under which a designated beneficiary (cannot be a charitable beneficiary) receives an annual fixed income. The grantor of the trust is ...
Individual who is legally responsible for taking care of another individual (s) who is deemed to be incapable of managing his/her own affairs. For example, children under the age of ...
Clause in a life insurance policy that states that once the cash value exceeds the net single premium (based on current interest and mortality rates) required for the policy to become ...
Have a question or comment?
We're here to help.