Premium Only Plan (POP)

Published: | Updated: October 9, 2017

Definition - What does Premium Only Plan (POP) mean?

The premium only plan (POP) is an initiative that was put into place by the U.S. Congress and added to IRS Code Section 125. It is intended to make premium payments for group benefits more affordable for employees. The POP allows employees to use money from their salaries to pay the premiums for their benefits programs pre-tax.

Insuranceopedia explains Premium Only Plan (POP)

The premium only plan essentially allows employees to save money on taxes by using some pre-tax income to pay the premiums on various types of employer-sponsored insurance. The POP is often used to pay for health insurance, dental insurance, and hospital indemnity.


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