PREMIUM ONLY CAFETERIA PLAN SUMMARY PLAN DESCRIPTION

Transcription

1 PREMIUM ONLY CAFETERIA PLAN SUMMARY PLAN DESCRIPTION August 1, 2009

2 TABLE OF CONTENTS DEFINITIONS...2 QUALIFIED EMPLOYEE CONTRIBUTIONS...2 ELIGIBILITY...2 ENROLLMENT...2 CHANGES IN COVERAGE...3 TAX SAVINGS...3 CLAIM PROCEDURE...4 CLAIM REVIEW AND APPEAL PROCEDURE...4 AMENDMENT AND TERMINATION...4 QUESTIONS AND ANSWERS...4 PLAN DESCRIPTION INFORMATION...5 STATEMENT OF ERISA RIGHTS...6 TIC/A/UAS 0809 i

3 A premium only cafeteria plan allows employees to treat after-tax contributions they would otherwise pay for certain company sponsored fringe benefits as pre-tax salary reductions. By reducing taxable income in this way, employees may reduce their taxes and thereby increase their net pay. Company means United Actuarial Services, Inc. DEFINITIONS Company Plan means any plan or program sponsored by the Company providing a Non-taxable Benefit. Examples include some medical, dental, vision and accidental death and dismemberment plans. Such plans are described under separate written documents. Compensation means the wages and salary that is paid by the Company to a Participant. Employee means any person who is receiving Compensation from the Company. Non-taxable Benefit means any benefit attributable to Employer contributions to the extent that such benefit is not currently taxable to the Participant upon the receipt of the benefit. Non-taxable Benefits such as some medical, dental, vision and accidental death and dismemberment benefits are referenced under separate written plans. Except as otherwise provided by law, amounts that the Company pays to purchase or otherwise provide certain Non-taxable Benefits to an Employee (i.e., Employer contributions) are not included in the Employee s taxable income. Under this Plan, amounts that would otherwise be deducted from the Employee s taxable income to help pay for the Non-taxable Benefits (i.e., Employee contributions) will be treated as salary reductions. Amounts by which the Employee s salary is reduced will be used to pay for the Employee s portion of the cost of the Non-taxable Benefits in the form of Employer contributions. Participant means an Employee taking part in the Plan. requirements. Such Employee must satisfy the Plan s eligibility Plan means this Premium Only Cafeteria Plan. Plan Year means a 12-month period commencing on January 1 and ending on December 31. QUALIFIED EMPLOYEE CONTRIBUTIONS Employee contributions that would otherwise be deducted from your after-tax Compensation to help pay for Nontaxable Benefits under the following Company Plans will be treated as pre-tax salary reductions under this Plan: Health insurance (including medical, dental and vision) Voluntary accidental death and dismemberment insurance ELIGIBILITY You are eligible to participate if you are an Employee, are not a 5% or greater shareholder and you are required to make a qualified Employee contribution for health and/or voluntary accidental death and dismemberment insurance. ENROLLMENT You do not need to do anything to enroll in the Plan. You are automatically enrolled when you join a Company Plan subject to a qualified Employee contribution. If you do not want to be automatically enrolled in the Plan, you must give the Company a completed Premium Only Cafeteria Plan Enrollment/Waiver form prior to the beginning of the first pay period you are required to make a qualified Employee contribution. TIC/A/UAS

4 ENROLLMENT (continued After initial eligibility, you may enroll or waive enrollment during a 30-day open enrollment period immediately preceding the beginning of each Plan Year (January 1) by giving the Company a completed Premium Only Cafeteria Enrollment/Waiver form. CHANGES IN COVERAGE Once you are in the Plan, your ability to reduce or increase your qualified Employee contributions is restricted by Federal regulation to certain events that are permitted by the rules of the Company Plans to which the contributions apply and are on account of and consistent with one or more of the following: 1. A change in marital status, including marriage, divorce or death of a spouse. 2. A change in the family, including the birth, death, adoption or placement for adoption of a child. 3. A change in employment status for the Employee, spouse or dependent including the termination or commencement of employment, switching from full to part-time status or vice versa, strike or lockout, commencement or return from an unpaid leave of absence or a change in one s work location. 4. A change in the Plan s eligibility rules that results in the gain or loss of coverage for an Employee, spouse or dependent. 5. An Employee, spouse or dependent becoming entitled to Medicare or Medicaid. 6. An Employee s dependent satisfies (or ceases to satisfy) the Plan s eligibility rules, including coverage changes compelled by a Qualified Medical Child Support Order. 7. A change in residence for the Employee, spouse or dependent if there is a corresponding loss of coverage. 8. A significant change in health coverage for the Employee, or spouse attributable to the spouse s employment. 9. A significant change in or cost of coverage. 10. An Employee s bankruptcy. 11. Termination of the Company Plan. Opportunities to change shall be consistent with Federal laws and regulations pertaining to such changes. Any rights of election under this Plan do not change or create any rights to enroll in, withdraw from or otherwise change an election in any other Company Plan. TAX SAVINGS Participating in the Plan will change the way payroll checks are calculated. Instead of deducting qualified Employee contributions after taxable income is calculated, the contributions will be taken as salary reductions before taxable income is calculated. This may reduce your taxable income for: Federal Income Tax State and Local Income Tax Social Security Tax (FICA) The Company does not have to pay Social Security tax (FICA) or federal unemployment payroll taxes (FUTA) on salary reductions. TIC/A/UAS

5 TAX SAVINGS (continued) The effect on taxable income is illustrated below (Note: your actual savings will depend on marital status, number of exemptions and other salary reductions, if any): Before Premium Only Cafeteria Plan After Premium Only Cafeteria Plan Bi-weekly Gross Pay $ $ Pre-Tax Health Care Salary Reduction Taxable Pay $ $ Federal Withholding Social Security Medicare State & Local Tax After-Tax Health Care Contribution Net Pay $ $ CLAIM PROCEDURE If you think that you have not received a Plan benefit to which you are entitled, you have the right to file with the Company a written notice of claim for such benefit. Within 90 days of receiving a written notice of claim, the Company will review the claim and notify you in writing if any additional information is required or if any benefits are denied in whole or in part. In the event of a denial, the written notification will include the specific reasons for the adverse determination, reference to the specific Plan provisions on which the denial is based and a description of the Plan s claim review and appeal procedures. CLAIM REVIEW AND APPEAL PROCEDURE If you do not agree with a claim denial, it may be appealed by sending the Company a written request for review within 60 days of receiving the notification of denial. The request must state why you believe the claim was improperly denied and other appropriate data. You will be notified in writing of the results of your appeal within 60 days of its receipt unless the Company requires an extension of time to review your request in which case you will be notified within 120 days. AMENDMENT AND TERMINATION The Company may amend or terminate the Plan at any time. In the event of termination, future benefits shall cease upon the day the Plan is terminated. Benefits for the Plan Year that have been earned up to the point of termination will not be forfeited. Q. When can an Employee join the Plan? QUESTIONS AND ANSWERS A. Employees are eligible for the Plan when they elect to participate in certain Company Plans for which Employee contributions are required. Q. How does an Employee elect to participate in the Plan? A. Election is automatic when you first join a Company Plan for which qualified Employee contributions are required. Q. Is participation in the Plan mandatory? A. No, you can elect not to participate in the Plan by signing and submitting a Premium Only Cafeteria Plan Enrollment/Waiver form indicating that you do not want to make pre-tax contributions. The form should be submitted by the first full pay-period following your automatic enrollment date. TIC/A/UAS

6 QUESTIONS AND ANSWERS (continued) Q. How much Compensation can be converted into a pre-tax salary reduction? A. The amount of Compensation that can be converted into a pre-tax salary reduction is equal to the qualified Employee contributions that you are required to pay. The amount will be adjusted automatically if there is a change in required contributions. Q. Can elections be changed or revoked during the Plan Year? A. In general, no. However, there are certain exceptions due to changes in family status and separation from service. Q. How will participation in the Plan affect Social Security benefits? A. Selection of tax-free benefits under the Plan will normally result in both you and the Company making lower contributions to the federal Social Security system. This could reduce Social Security benefits. In addition, other benefits based on taxable compensation could be reduced, such as worker s compensation, unemployment insurance and disability benefits. Q. How will the Plan affect retirement plan contributions? A. Contributions to a company sponsored retirement plan are not affected by salary reductions under the Plan. Plan Name: United Actuarial Services, Inc. Premium Only Cafeteria Plan Employer Identification Number: Plan Number: 510 Plan Administrator: United Actuarial Services, Inc North Meridian Street, Suite 610 Carmel, IN (317) Agent for Service of Legal Process: United Actuarial Services, Inc North Meridian Street, Suite 610 Carmel, IN (317) Fiscal Year: January 1 through December 31 Plan Year: January 1 through December 31 PLAN DESCRIPTION INFORMATION TIC/A/UAS

7 Funding: Employee contributions are converted into Non-taxable Benefits in the form of salary reductions. STATEMENT OF ERISA RIGHTS Plan participants are entitled to certain protection and rights under the Employment Retirement Income Security Act of 1974 (ERISA). For example, ERISA provides that all Plan participants are entitled to: 1. Examine, without charge, at the Plan Administrator's office, all Plan documents, including insurance contracts, and copies of all documents filed by the Plan with the U.S. Department of Labor, such as detailed annual reports and Plan descriptions. Upon written request, you may receive information as to whether a particular employer or employee organization is a sponsor of the Plan and, if so, the sponsor's address. 2. Obtain copies of all Plan documents and other Plan information upon written request to the Plan Administrator. The Plan Administrator may make a reasonable charge for the copies. In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate your Plan, called "fiduciaries" of the Plan, have a duty to do so with reasonable care and in the interest of you and other Plan participants and beneficiaries. No one may take any action that would prevent you from obtaining a benefit for which you are entitled under the Plan or exercising your rights under ERISA. If your claim for a benefit is denied in whole or in part, you must receive a written explanation of the reason for the denial. Then, if you are not satisfied with the action on your claim, you have the right to have the Plan review and reconsider your claim in accordance with the Plan's claim review procedure. Under ERISA, there are two (2) steps that you can take to enforce the above rights: 1. If you request materials from the Plan and do not receive them within 30 days, you may file suit in federal court. The court may require the Plan Administrator to provide the materials and may even order the Plan Administrator to pay you a fine until you actually receive the materials, unless the delay was caused by reasons beyond the Administrator's control. 2. If you have a claim for benefits that is denied or ignored, you may file suit in a state or federal court. However, before exercising this right, you will normally find it advisable to exhaust all the claim review procedures provided under the Plan and then to proceed only upon the advice of your attorney. If you feel that the Plan fiduciaries may be misusing money paid under the Plan or are discriminating against you for asserting your rights under ERISA, you may seek assistance from the U. S. Department of Labor or you may file suit in a federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees. For example, if the court finds your claim is frivolous, you may be required to pay court costs and legal fees. If you have any questions about your Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA which have not been answered by the booklet or the Plan Administrator, you should contact the nearest area office of the Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C., listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, 200 Constitution Avenue, N.W., Washington, D.C TIC/A/UAS