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
Stated fixed payment for maternity costs regardless of the actual costs. ...
Property valued according to its earnings potential. However, property insurance contracts generally indemnify an insured on a replacement cost less physical depreciation and obsolescence ...
Risk distribution included by type of coverage, by kind of risk, and by geographical location. ...
Maximum limit of liability of an insurance company for a particular claim or kind of loss that is applicable in general to all such claims or losses. This maximum limit of liability is ...
Means of borrowing at no charge by a policyowner under universal life insurance policies. ...
Coverage underwritten on members of a natural group, such as employees of a particular business, union, association, or employer group. Each employee is entitled to benefits for hospital ...
Statistic indicating the degree of dispersion in a set of outcomes, computed as the arithmetic mean of the differences between each outcome and the average of all outcomes in the set. ...
Coverage for exposures that exhibit a possibility of financial loss. ...
Type of individual retirement account (IRA) allowed by the employees retirement income security act of 1974 (erisa) in which contributions are paid into a custodial account sponsored by a ...
Have a question or comment?
We're here to help.