What is ERISA coverage?

Answer 1

This coverage protects the insured from claims brought by his employees alleging a breach of obligation or duty with respects to any employee benefit plan or sponsored trust.

ERISA applies to two types of plans - "Employee Welfare Benefit Plans" and "Employee Pension Benefit Plans."

An "Employee Welfare Benefit Plan" [ERISA § 3(1); DOL Reg. § 2510.3-1] is

Any plan, fund, or program established or maintained by an employer or by an employee organization, or by both, which provides any of the following benefits, through insurance or otherwise

· health insurance

· group life insurance

· long-term disability income

· severance pay

· funded vacation benefits, apprenticeship or other training programs, or day care centers, scholarship funds, or prepaid legal services; and

· any benefit described in section 302(c) of the Labor Management Relations Act (other than pensions on retirement or death)

"Payroll practices" (see ER3) and certain group or group-type insurance programs with minimal employer or employee organization involvement are not included.

An "Employee Pension Benefit Plan" [ERISA § 3(2); DOL Reg. § 2530.3-2] is

Any plan, fund, or program established or maintained by an employer or by an employee organization, or by both, which

· provides retirement income to employees, OR

· results in a deferral of income by employees for periods extending to the termination of covered employment or beyond

Employee Pension Benefit Plans include:

· Profit-sharing retirement plans

· Stock bonus plans

· Money purchase plans

· 401(k) plans

· Employee stock ownership plans

· Defined benefit retirement plans