Rabbi Trust
Definition of "Rabbi trust"
Trust named from a private-letter ruling by the IRS that involved a trust established by a Jewish congregation on behalf of its rabbi. The operation of the trust involves the employer's making contributions to the trust that are irrevocable. An independent trustee has control of the trust and must pay benefits from it if a stipulated event occurs, such as the death, disability, or retirement of the employee. If the employer becomes bankrupt or insolvent, the funds held in the trust are subject to the claims of the employer's creditors. The employer cannot take income tax deductions for its contributions to the trust until the funds in the trust are actually distributed to the employee.
Popular Insurance Terms
Type of major medical deductible amount that acts as a corridor between benefits under a basic health insurance plan and benefits under a major medical insurance plan. After benefits are ...
Same as term Fortuitous Loss: loss occurring by accident or chance, not by anyone's intention. Insurance policies provide coverage against losses that occur only on a chance basis, where ...
Measure of the sensitivity of the insurance company's liability to changing policy surrender distributions. ...
Payments awarded by a court in a liability suit. Money damages can be broken down into compensatory and punitive. Compensatory damages reimburse a plaintiff for expenses incurred for such ...
Maximum amount under a liability policy that insurance company will pay for bodily injury incurred by any one person in any one accident. ...
Means of ending a pension plan only for reasons of business necessity, following IRS regulations. If the IRS determines that the plan was terminated for other reasons, employee and employer ...
Annuity contract. If the annuitant dies before receiving income at least equal to the premiums paid, a beneficiary receives the difference in installments. If the annuitant lives after the ...
Time period, for a life insurance policy, in which losses occur. This period must be determined to project the frequency and severity of future loss experience. ...
Same as term Builders Risks Forms: types of contracts that insure building contractors for damage to property under construction. The completed value form requires a 100% coinsurance ...
Have a question or comment?
We're here to help.