2009 Instructions For Schedule A (Form 5500) Insurance Information (Page 2 of 3) in pdf

sale or renewal of a policy, such as finder’s fees, insurance

Element (d). Enter the purpose(s) for which fees were paid.

brokerage commissions and fees, or similar fees.

Element (e). Enter the most appropriate organization code for

the broker, agent, or other person entered in element (a).

Schedule A reporting also is not required for compensation

paid by the insurer to a “general agent” or “manager” for that

general agent’s or manager’s management of an agency or

Code Type of Organization

performance of administrative functions for the insurer. For this

Banking, Savings & Loan Association, Credit Union, or

purpose, (1) a “general agent” or “manager” does not include

other similar financial institution

brokers representing insureds, and (2) payments would not be

Trust Company

treated as paid for managing an agency or performance of

Insurance Agent or Broker

administrative functions where the recipient’s eligibility for the

Agent or Broker other than insurance

payment or the amount of the payment is dependent or based

Third party administrator

on the value (e.g., policy amounts, premiums) of contracts or

Investment Company/Mutual Fund

policies (or classes thereof) placed with or retained by ERISA

Investment Manager/Adviser

plan(s).

Labor Union

Schedule A reporting is not required for occasional

Foreign entity (e.g., an agent or broker, bank, insurance

non-monetary gifts or meals of insubstantial value that are tax

company, etc., not operating within the jurisdictional

deductible for federal income tax purposes by the person

boundaries of the United States)

providing the gift or meal and would not be taxable income to

Other

the recipient. For this exemption to be available, the gift or

gratuity must be both occasional and insubstantial. For this

For plans, GIAs, MTIAs, and 103-12 IEs required to file Part

exemption to apply, the gift must be valued at less than $50, the

I of Schedule C, commissions and fees listed on the Schedule

aggregate value of gifts from one source in a calendar year

A are not required to be reported again on Schedule C. The

must be less than $100, but gifts with a value of less than $10

amount of the compensation that must be reported on Schedule

do not need to be counted toward the $100 annual limit. If the

A must, however, be taken into account in determining whether

$100 aggregate value limit is exceeded, then the aggregate

the agent’s, broker’s, or other person’s direct or indirect

value of all the gifts will be reportable. For this purpose,

compensation in relation to the plan or DFE is $5,000 or more

non-monetary gifts of less than $10 also do not need to be

and, thus, requiring the compensation not listed on the

included in calculating the aggregate value of all gifts required

Schedule A to be reported on the Schedule C. See FAQs about

to be reported if the $100 limit is exceeded.

the “2009 Form 5500 Schedule C” available on the EBSA

website at

Gifts from multiple employees of one service provider should

be treated as originating from a single source when calculating

Part II - Investment and Annuity Contract Information

whether the $100 threshold applies. On the other hand, in

Line 4. Enter the current value of the plan’s interest at year

applying the threshold to an occasional gift received from one

end in the contract reported on line 7, e.g., deposit

source by multiple employees of a single service provider, the

administration (DA), immediate participation guarantee (IPG), or

amount received by each employee should be separately

guaranteed investment contracts (GIC).

determined in applying the $50 and $100 thresholds. For

example, if six employees of a broker attend a business

Exception. Contracts reported on line 7 need not be included

conference put on by an insurer designed to educate and

on line 4 if (1) the Schedule A is filed for a defined benefit

explain the insurer’s products for employee benefit plans, and

pension plan and the contract was entered into before March

the insurer provides, at no cost to the attendees, refreshments

20, 1992, or (2) the Schedule A is filed for a defined contribution

valued at $20 per individual, the gratuities would not be

pension plan and the contract is a fully benefit-responsive

reportable on lines 2 and 3 of the Schedule A even though the

contract, i.e., it provides a liquidity guarantee by a financially

total cost of the refreshments for all the employees would be

responsible third party of principal and previously accrued

$120.

interest for liquidations, transfers, loans, or hardship

withdrawals initiated by plan participants exercising their rights

These thresholds are for purposes of Schedule A reporting.

to withdraw, borrow, or transfer funds under the terms of a

Filers are cautioned that the payment or receipt of gifts and

defined contribution plan that does not include substantial

gratuities of any amount by plan fiduciaries may violate ERISA

restrictions to participants’ access to plan funds.

and give rise to civil liabilities and criminal penalties.

Important Reminder. Plans may treat multiple individual

Line 3. Identify agents, brokers, and other persons individually

annuity contracts, including Code section 403(b)(1) annuity

in descending order of the amount paid. Complete as many

contracts, issued by the same insurance company as a single

entries as necessary to report all required information.

group contract for reporting purposes on Schedule A.

Complete elements (a) through (e) for each person as specified

Line 6a. The rate information called for here may be furnished

below.

by attaching the appropriate schedules of current rates filed

Element (a). Enter the name and address of the agents,

with the appropriate state insurance department or by providing

brokers, or other persons to whom commissions or fees were

a statement regarding the basis of the rates. Enter “see

paid.

attached” if appropriate.

Element (b). Report all sales and base commissions here. For

Lines 7a through 7f. Report contracts with unallocated funds.

purposes of this element, sales and/or base commissions are

Do not include portions of these contracts maintained in

monetary amounts paid by an insurer that are charged directly

separate accounts. Show deposit fund amounts rather than

to the contract or policy and that are paid to a licensed agent or

experience credit records when both are maintained.

broker for the sale or placement of the contract or policy. All

Part III - Welfare Benefit Contract Information

other payments should be reported in element (c) as fees.

Line 8i. Report a stop-loss insurance policy that is an asset of

Element (c). Fees to be reported here represent payments by

the plan.

an insurer attributable directly or indirectly to a contract or policy

to agents, brokers, and other persons for items other than sales

Note. Employers sponsoring welfare plans may purchase a

and/or base commissions (e.g., service fees, consulting fees,

stop-loss insurance policy with the employer as the insured to

finders fees, profitability and persistency bonuses, awards,

help the employer manage its risk associated with its liabilities

prizes, and non-monetary forms of compensation). Fees paid to

under the plan. These employer contracts with premiums paid

persons other than agents and brokers should be reported

exclusively out of the employer’s general assets without any

here, not in Parts II and III on Schedule A as acquisition costs,

employee contributions generally are not plan assets and are

administrative charges, etc.

not reportable on Schedule A.

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Instructions for Schedule A (Form 5500)

2009 Instructions For Schedule A (Form 5500) Insurance Information Page 2

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