Co-Founder, Coastal Financial Partners Group, California
ERISA doesn't directly address life insurance. ERISA is a federal law which dates back to 1974 that sets minimum standards for retirement plans in the private sector. The protections provided to plan participants are extensive. To the extent that retirement plans utilize life insurance and related products as plan assets, the standards and protections can indirectly apply to such products. For example, there are specific rules for qualified retirement plans which place limits on life insurance as a plan asset.
ERISA jurisdiction covers qualified plans. It is conceivable that life insurance could be part of the contribution to a qualified plan with certain product limitations (while life 49.5%, universal life 25%). The economic benefit of the insurance portion is subject to taxation as an additional item beyond the cash values. But beyond that ERISA has no jurisdiction over life insurance.
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ERISA jurisdiction covers qualified plans. It is conceivable that life insurance could be part of the contribution to a qualified plan with certain product limitations (while life 49.5%, universal life 25%). The economic benefit of the insurance portion is subject to taxation as an additional item beyond the cash values. But beyond that ERISA has no jurisdiction over life insurance.