Voluntary Plan Termination
Updated: 11 March 2024
What Does Voluntary Plan Termination Mean?
A voluntary plan termination occurs when an employer ending a voluntary pension plan. Voluntary pension plans one of the retirement savings tool that is often offered by employers. Life insurance policies are also commonly offered, along with pensions, as a savings tool, since both policies can have investing components.
Insuranceopedia Explains Voluntary Plan Termination
If an employer voluntarily terminates a plan, then, under federal law, the assets of the plan must be given to the participants in the plan. This is because a portion of the employee’s paycheck is used to pay the premiums for the pension. So, when an employee changes jobs or moves on after the voluntary plan termination, they take the assets with them, assets that can be worth a substantial amount of money.
Related Definitions
Related Terms
Related Articles
The Key Elements of an Insurance Contract
Insurance Self-Service Portal: The Future of Customer Experience
Blockchain’s Impact on Transforming the Insurance Landscape
What Every College Student Should Know About Renters Insurance
Guidance for Nurses: Five Essential HIPAA Compliance Tips
Insuring Your Financial Future: the Crucial Role of Accounting in Insurance
Related Reading
What Is Temporary Life Insurance?
Revealing the Most And Least Popular U.S. Insurance Companies
Texas is the state with most people killed by animals in the US
Life Insurance Statistics
How Long Do You Have To Have Life Insurance Before You Die?
Life Insurance Statistics