What Does Summary Plan Description Mean?
A summary plan description is a document that lays out all of the details of a pension plan or a retirement package. Employers send them to their employees so they have the information to fully understand the details of what is being offered to them. Similarly, insurance companies offer potential clients various informational materials so they can look at the various plans available to them.
Insuranceopedia Explains Summary Plan Description
Summary plan descriptions include details, such as benefits, restrictions, and any other information relevant to ensuring the employee knows exactly what the employer's retirement package offers. They are designed to be easy for the employee to understand. For example, a corporation may offer 80% of their salary as pension benefits to employees who have been at the company for 30 or more years, 50% to those who have been at the company for 20 or more years, and so on.