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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. Under Vermont law, employer contribution is required, and the employer may not be the beneficiary. The policy must cover at least ten employees at date of issue.
The premium must be paid by the policyholder, 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. No policy may be issued on which the entire premium is to be derived from funds contributed by the insured employees. A policy on which part of the premium is to be derived from funds contributed by the insured employees may be placed in force only if at least 75 percent of the then eligible employees, excluding any as to whom evidence of individual insurability is not satisfactory to the insurer, 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.
There is a grace period of 31 days.
State
Contact
Department of Banking, Insurance, Securities, and Health Care Administration
Regulations
Vermont State Statutes, Title 08 Banking and Insurance, Chapter 103 Life Insurance Policies and Annuity Contracts
§ 3801 et seq.
Federal
Contact
Employee Benefits Security Administration (EBSA)
Regulations
29 CFR chapter XXV (Parts 2509 – 2590)