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
Same as term Line Limit: maximum amount of a specified type of insurance coverage, according to underwriting guidelines, that an insurance company feels it can safely underwrite on a ...
Vehicle that is available to anyone in the United States as a means for savings in a tax-exempt fashion for college, graduate, or professional schools or other eligible accredited business, ...
Quality of investments of insurance companies. State insurance regulators establish rules for company investments. Authorized investments vary, depending on whether a company is a life ...
Landmark legislation passed by Congress providing the first regulation of the securities markets. The law, enforced by the securities and exchange commission (sec), requires registration of ...
Distribution of a deceased beneficiary's share of an estate among all of his or her living heirs. Contrast with per stirpes. ...
Reinsurance: surplus reinsurance contracts under which the agreement between an insurer and a re insurer is based on the ceding company's line guide, such that the amount re insured is ...
Act that regulates the variable dollar insurance products (equity related) sold by insurance companies. The act includes regulations that stipulate: the variable dollar insurance products ...
Process of distributing the costs associated with losses and risks over a number of insureds. ...
Date of the initial annuity payment. ...
Have a question or comment?
We're here to help.