29 CFR 2520.104-21 - Limited exemption for certain group insurance arrangements.

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There is 1 rule appearing in the Federal Register for 29 CFR 2520. View below or at eCFR (GPOAccess)
§ 2520.104-21 Limited exemption for certain group insurance arrangements.
(a) Scope. Under the authority of section 104(a)(3) of the Act, the administrator of any employee welfare benefit plan which covers fewer than 100 participants at the beginning of the plan year and which meets the requirements of paragraph (b) of this section is exempted from certain reporting and disclosure provisions of the Act. Specifically, the administrator of such plan is not required to file with the Secretary a terminal report or furnish upon written request of any participant or beneficiary a copy of any terminal report as required by section 104(b)(4) of the Act.
(b) Application. This exemption applies only to welfare plans, each of which has fewer than 100 participants at the beginning of the plan year and which are part of a group insurance arrangement if such arrangement:
(1) Provides benefits to the employees of two or more unaffiliated employers, but not in connection with a multiemployer plan as defined in section 3(37) of the Act and any regulations prescribed under the Act concerning section 3(37);
(2) Fully insures one or more welfare plans of each participating employer through insurance contracts purchased solely by the employers or purchased partly by the employers and partly by their participating employees, with all benefit payments made by the insurance company: Provided, That—
(i) Contributions by participating employees are forwarded by the employers within three months of receipt,
(ii) Refunds, to which contributing participants are entitled, are returned to them within three months of receipt, and
(iii) Contributing participants are informed upon entry into the plan of the provisions of the plan concerning the allocation of refunds; and
(3) Uses a trust (or other entity such as a trade association) as the holder of the insurance contracts and uses a trust as the conduit for payment of premiums to the insurance company.
(c) Limitations. This exemption does not exempt the administrator of an employee benefit plan from any other requirement of title I of the Act, including the provisions which require that plan administrators furnish copies of the summary plan description to participants and beneficiaries (section 104(b)(1)), file an annual report with the Secretary of Labor (section 104(a)(1)) and furnish certain documents to the Secretary of Labor upon request (section 104(a)(6)), and authorize the Secretary of Labor to collect information and data from employee benefit plans for research and analysis (section 513).
(d) Examples.
(1) A welfare plan has 25 participants at the beginning of the plan year. It is part of a group insurance arrangement of a trade association which provides benefits to employees of two or more unaffiliated employers, but not in connection with a multiemployer plan as defined in the Act. Plan benefits are fully insured pursuant to insurance contracts purchased with premium payments derived half from employee contributions (which the employer forwards within three months of receipt) and half from the general assets of each participating employer. Refunds to the plan are paid to participating employees within three months of receipt as provided in the plan and as described to each participant upon entering the plan. The trade association holds the insurance contracts. A trust acts as a conduit for payments, receiving premium payments from participating employers and paying the insurance company. The plan appoints the trade association as its plan administrator. The association, as plan administrator, provides summary plan descriptions to participants and beneficiaries, enlisting the help of participating employers in carrying out this distribution. The plan administrator also makes copies of certain plan documents available to the plan's principal office and such other places as necessary to give participants reasonable access to them. The plan administrator files with the Secretary an annual report covering activities of the plan, as required by the Act and such regulations as the Secretary may issue. The exemption provided by this section applies because the conditions of paragraph (b) have been satisfied.
(2) Assume the same facts as paragraph (d)(1) of this section except that the premium payments for the insurance company are paid from the trust to an independent insurance brokerage firm acting as the agent of the insurance company. The trade association is the holder of the insurance contract. The plan appoints an officer of the participating employer as the plan administrator. The officer, as plan administrator, performs the same reporting and disclosure functions as the administrator in paragraph (d)(1) of this section, enlisting the help of the association in providing summary plan descriptions and necessary information. The exemption provided by this section applies.
(3) The facts are the same as paragraph (d)(1) of this section except the welfare plan has 125 participants at the beginning of the plan year. The exemption provided by this section does not apply because the plan had 100 or more participants at the beginning of the plan year. See, however, § 2520.104-43.
(4) The facts are the same as paragraph (d)(2) of this section except the welfare plan has 125 participants. The exemption provided by this section does not apply because the plan had 100 or more participants at the beginning of the plan year. See, however, § 2520.104-43.
(e) Applicability date. For purposes of paragraph (b)(3) of this section, the arrangement may continue to use an entity (such as a trade association) as the conduit for the payment of insurance premiums to the insurance company for reporting years of the arrangement beginning before January 1, 2001.
[43 FR 10149, Mar. 10, 1978, as amended at 65 FR 21084, Apr. 19, 2000; 67 FR 776, Jan. 7, 2002]

Title 29 published on 2013-07-01

The following are only the Rules published in the Federal Register after the published date of Title 29.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2014-11-10; vol. 79 # 217 - Monday, November 10, 2014
    1. 79 FR 66617 - Revisions to Annual Return/Report—Multiple-Employer Plans
      GPO FDSys XML | Text
      DEPARTMENT OF LABOR, Employee Benefits Security Administration
      Interim final rule with request for comments.
      Effective Date. This interim final rule is effective on November 10, 2014. Comment Date. Comments are due on or before January 9, 2015. We will consider public comments in connection with publishing a final rule that would apply no earlier than the 2015 Form 5500. Applicability Dates. The multiple-employer plan reporting requirements under the CSEC Act apply to plan years beginning after December 31, 2013, which created an immediate need for changes to the Form 5500 and Form 5500-SF. Accordingly, the CSEC Act form changes in this document will be applicable beginning with the 2014 Form 5500 Annual Returns/Reports filed for plan years beginning after December 31, 2013.
      29 CFR Part 2520

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Title 29 published on 2013-07-01

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 29 CFR 2520 after this date.

  • 2014-11-10; vol. 79 # 217 - Monday, November 10, 2014
    1. 79 FR 66617 - Revisions to Annual Return/Report—Multiple-Employer Plans
      GPO FDSys XML | Text
      DEPARTMENT OF LABOR, Employee Benefits Security Administration
      Interim final rule with request for comments.
      Effective Date. This interim final rule is effective on November 10, 2014. Comment Date. Comments are due on or before January 9, 2015. We will consider public comments in connection with publishing a final rule that would apply no earlier than the 2015 Form 5500. Applicability Dates. The multiple-employer plan reporting requirements under the CSEC Act apply to plan years beginning after December 31, 2013, which created an immediate need for changes to the Form 5500 and Form 5500-SF. Accordingly, the CSEC Act form changes in this document will be applicable beginning with the 2014 Form 5500 Annual Returns/Reports filed for plan years beginning after December 31, 2013.
      29 CFR Part 2520