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Summary of differences between federal and state regulations
Employee benefits are generally covered under the federal jurisdiction of the Employee Retirement Income Security Act (ERISA).
Federal ERISA plans generally do not have to comply with state laws. ERISA rules preempt or block state laws that relate to ERISA plans. State insurance laws, however, do apply. Montana has laws governing group life insurance that provide, for example, the following:
The employer cannot be the beneficiary.
The premium must be paid either wholly from the employer's funds or funds contributed by him or partly from such funds and partly from funds contributed by the insured employees. The entire premium may not be derived from funds contributed by the insured employees. You may have a policy on which part of the premium is to be derived from funds contributed by the insured employees only if at least 75 percent of the then eligible employees elect to make the required contribution. A policy on which no part of the premium is to be derived from funds contributed by the insured employees must insure all eligible employees or all except any as to whom evidence of individual insurability is not satisfactory to the insurer.
The policy must cover at least 2 employees at date of issue.
The grace period is 31 days.
Any group life policy may be extended to insure the employees against loss due to the death of their spouses and minor children.
Coverage will cease if the employee becomes eligible for coverage under another group policy because of employment elsewhere.
The policy may be continued even if the covered employee’s regular work hours are reduced to less than the minimum amount of hours required for membership. The premium charged for the continued coverage must be equal to the premium charged to other members of the group.
State
Contact
Montana State Auditor, Insurance Division
Regulations
Montana Code Annotated
Title 33 Insurance and Insurance Companies, Chapter 20 Life Insurance, Part 11 Group and Group Requirements,
§33-20-1101 Employee groups
http://leg.mt.gov/bills/mca/33/20/33-20-1101.htm
§33-20-1111 Dependents of employee and labor union groups — coverage
http://leg.mt.gov/bills/mca/33/20/33-20-1111.htm
§33-20-1202 Grace period
Federal
Contact
Employee Benefits Security Administration (EBSA)
Regulations
29 CFR chapter XXV (Parts 2509 – 2590)