Summary Plan Description

What Does Summary Plan Description Mean?

A summary plan description is a document that outlines the details of a pension plan or retirement package. Employers provide this document to their employees, ensuring they have a clear understanding of the benefits being offered. Similarly, insurance companies provide potential clients with informational materials to help them explore and compare the available plans.

Insuranceopedia Explains Summary Plan Description

Summary plan descriptions provide details such as benefits, restrictions, and other relevant information to ensure employees fully understand what the employer’s retirement package offers. These descriptions are designed to be clear and easy to understand. For instance, a company might offer 80% of an employee’s salary as pension benefits to those with 30 or more years of service, 50% for employees with 20 or more years, and so on.