Top-heavy Plan
Definition of "Top-heavy plan"
Pension or other employee benefit plan that favors highly compensated employees or top executives or owners of a company. Prior to the tax reform act of 1986, there was no uniform definition of a "highly compensated" employee, but that law provides a specific definition that is used for qualified pension plans, 401 (k) plans, and some other employee benefits. An employee is considered highly compensated if he or she: (1) directly or indirectly owns more than a 5% interest in the company, (2) receives compensation from the company of more than $75,000, (3) is paid more than $50,000 and was among the top 20% of employees ranked by compensation, or (4) is at any time an officer and receives compensation that was more than 150% of the Section 415 defined-contribution dollar amount.
Popular Insurance Terms
Written statement by an insurance company attesting to the powers it has vested in an agent. ...
Trust established under the auspices of the Internal Revenue Code that permits the maintenance of a separate account within the employer's defined benefit pension plan from which to pay the ...
Increase or decrease in the surrender charge of the life insurance policy or annuity contract depending on the current financial markets. The cash value is adjusted upward if the policy ...
Rule adopted by the financial accounting standards board that requires that obligations owed to re-insurers under multiyear insurance contracts must be reported as liabilities by the ceding ...
Person who engages an agent or broker for advice and possible purchase of insurance. ...
Expectation of death. The probability of its occurrence is shown by a mortality table, which is important in determining the premiums for life insurance policies. ...
Rate of increase in asset value. ...
Time during which an assessment life insurance company has the right to assess policyholders if losses are worse than anticipated in the premium charged. ...
Physical contact of an automobile with another inanimate object resulting in damage to the insured car. Insurance coverage is available to provide protection against this occurrence. ...
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