Removing life insurance feature

[Guest Schitze32]

If a 401(k) is amended to not allow for new life insurance policies to be purchased, may the old policies continue? If they are permitted to continue, is this subject to annual non-discrimination testing?

[BG5150]

I believe keeping the old policies is ok. Just like taking loans away; the old ones can stay.

[John Feldt ERPA CPC QPA]

So this does not become a benefit right or feature that needs testing, when ten years later, the HCE is the only one who has this?

[Guest Schitze32]

I remember reading that ancillary benefits must be tested for BRF purposes, but I cannot remember the specific regulation section which allow for a "snapshot" test to be done at the time of the amendment and the results used for future testing years.