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LOMA 380 — Financial Services and Products for Organizations

Course Type: Traditional Designation Course
Topics: Financial Services & Financial Planning, Group Insurance
Designations: AFSI, FFSI
Language: English


LOMA 380 introduces a broad array of group insurance and employee retirement plans, including health insurance, disability insurance, managed care plans, social security programs, dental insurance, prescription drug, vision and hearing benefits, group life insurance, defined benefit retirement plans and their requirements, 401(k) plans, profit-sharing plans, employee stock ownership plans, 403(b) plans, hybrid retirement plans, defined contribution plans, executive benefits, and individual retirement arrangements.


  • Environment of Employee Benefits
  • Employee Benefits and Group Insurance
  • Social Security Programs
  • Health Insurance Programs
  • Managed Care Health Plans
  • Dental Plans
  • Prescription Drug, Vision, and Hearing Benefits
  • Disability Insurance
  • Group Life Insurance: Term and Permanent
  • Tax Qualification and Legal
  • Requirements for Retirement Plans
  • Defined Benefit Retirement Plans
  • Retirement Plan Termination Insurance
  • 401(k) Plans
  • Profit Sharing Plans
  • Employee Stock Ownership Plans
  • Section 403(b) Plans
  • Hybrid Pension Plans
  • Money Purchase Pension Plans
  • Retirement and Employee Benefits for Executive Employees
  • Funding Arrangements for Group Retirement Plans
  • Independent Retirement Arrangements

Part One—Introduction to Employee Benefits

Chapter 1. Employee Benefits in a Changing Business and Social Context

Defining and Exploring Employee Benefits

Defining Employee Benefits

The Field of Employee Benefits Practice

Origins of Employee Benefits

Legally Required Benefits

Discretionary Benefits

Legal and Regulatory Influences on Discretionary Benefits Practices

Forces Shaping Employee Benefits

Business Savvy

Labor Unions

U.S. Federal Government

The Future of Employee Benefits

Changing Employment Contract

Changing Demographics of the Labor Force

Accountability to Shareholders

Recent and Prospective Legislation

Chapter 2. Planning and Administering the Employee Benefits Program

Strategic Planning for the Benefits Program

Basic Strategic Planning Concepts

Approaches to Strategic Benefit Planning

Information Used in Strategic Benefit Planning

External Environment

Internal Environment

Managing the Costs of Employee Benefits

Utilization Reviews

Case Management

Provider Payment Systems

A Comparison of Traditional Benefits Plans and Flexible Benefits Plans

A One-Size-Fits-All Approach

Employee Choice to Customize Benefits

Cafeteria Plans under Section 125

Types of Flexible Benefit Plan Arrangements

Communicating the Employee Benefits Program

Legal Considerations in Benefits Communication

The "Good Business Sense" of Benefits Communication

Outsourcing the Benefits Function

Chapter 3. Regulation of Discretionary Employee Benefits Offering

Labor Unions and Employee Benefits: National Labor Relations Act of 1935


Relevance to Employee Benefits

Internal Revenue Code

Fair Labor Standards Act of 1938

Employee Retirement Income Security Act of 1974

Defining Pension Plans and Welfare Plans

Scope of Coverage for Pension Plans and Welfare Plans

Title I: Protection of Employee Rights

Title II: Amendments to the Internal Revenue Code Relating to Retirement Plans

Title III: Jurisdiction, Administration, Enforcement, Joint Pension Task Force, and Other Issues

Title IV: Plan Termination Insurance

Consolidated Omnibus Budget Reconciliation Act of 1985

Health Insurance Portability and Accountability Act of 1996

Federal Equal Employment Opportunity Laws

Equal Pay Act of 1963

Title VII of the Civil Rights Act of 1964

Age Discrimination in Employment Act (ADEA) of 1967

Pregnancy Discrimination Act of 1978

Americans with Disabilities Act of 1990

Civil Rights Act of 1991

Part Two—Insurance Benefits

Chapter 4. Social Security Programs

Introduction to the Social Security Programs

Employers Required to Participate in Social Security Programs

Administration of Social Security Programs

Social Security Numbers

Historical Background

Old-Age, Survivor, and Disability Insurance (OASDI)

Qualifying for OASDI Benefits

Determining Benefit Amounts

Old-Age Benefits

Survivor Benefits

Disability Benefits


Eligibility Criteria for Medicare Benefits

Medicare Part A Coverage

Medicare Part B Coverage

Medigap Insurance

Medicare Part C Coverage

Medicare as the Primary or Secondary Payer

Financing OASDI and Medicare Programs

Adequacy of Financing

FICA Coverage during Employment outside the United States

Depositing FICA Money

Unemployment Insurance

Eligibility Criteria for Unemployment Insurance Benefits

Unemployment Insurance Benefit Amounts

Financing Unemployment Insurance Benefits

Depositing FUTA Money

Chapter 5. Health Insurance Programs

Defining and Exploring Health Insurance Programs

Origins of Health Insurance Benefits

Health Insurance Coverage and Costs

Individual versus Group Insurance Coverage

Regulation of Health Insurance Programs

Federal Regulation

State Regulation

Fee-for-Service Plans

Types of Medical Expense Benefits

Features of Fee-for-Service Plans

Major Medical Insurance Plans: Supplemental and Comprehensive

Managed Care Plans

Health Maintenance Organizations

Types of Health Maintenance Organizations

Features of Health Maintenance Organizations

Preferred Provider Organizations

Features of Preferred Provider Organizations

Point-of-Service Plans

Specialized Insurance Benefits

Dental Insurance

Vision Insurance

Prescription Drug Benefits

Mental Health and Substance Abuse

Maternity Care

Cost-Control Methods

Utilization Reviews

Case Management

Provider Payment Systems

Medical Savings Accounts

Retiree Health Care Benefits

Chapter 6. Health Plan Design Evolution

Hospital/Medical Plan Designs—Then and Now

Hospitalization Coverage—Background

Hospitalization Coverage—Today

Medical/Surgical Coverage—Background

Medical/Surgical Coverage—Today

Major Medical Coverage—Background

Major Medical Benefits—Today

Comprehensive Medical Plans—Background

Comprehensive Plan Benefits—Today

Managed Care Plan Designs

Health Maintenance Organizations (HMOs)

Preferred Provider Organizations (PPOs)

Point-of-Service (POS) Programs

Today—Integrated Health Care Systems

Underwriting and Funding Approaches

Community Rating

Adjusted Community Rating

Experience Rating

Cost-Plus Funding and Self-Insured Approaches

Stop-Loss Insurance

Provider Reimbursement Approaches

Fee-for-Service Method


Health Care Purchasing Cooperatives

Health Care Strategy

Designing the Plan and Delivery System

Self-Administration, Third Party Administrators, and Unbundled Services

Multiple Plan Offerings and Single or Multiple Administrators

Pricing Plan Options and Designing Employer Subsidies

Employee Selection Patterns and Pricing

Underwriting and Financial Arrangements

Measuring Performance and Managing the Plan

Chapter 7. Managed Care Health Plans: The Managed Care Spectrum

Economic Trends Facing the Employer

Federal Government Cost Shifting

Competitive Global Environment

National Resources Spent on Health Care

Development of Managed Care

History of Managed Care

Characteristics of Managed Care

Types of Managed Care Plans

Managed Indemnity Plans

Preferred Provider Organizations (PPOs)

Point-of-Service (POS) Plans

Health Maintenance Organizations (HMOs)

Comparing Managed Care Plans: The Managed Care Spectrum

Standard Indemnity Plans

Managed Indemnity Plans

Preferred Provider Organizations (PPOs)

Point-of-Service (POS) Plans

Health Maintenance Organizations (HMOs)

Emerging Managed Care Applications

Medicare/Medicaid Benefits

Mental Health/Substance Abuse Benefits

Disability Benefits

Workers' Compensation Benefits

Chapter 8. Managed Care Health Plans: Understanding Costs and Evaluating Plans

Health Care Cost Equation

Elements of Price Management

Elements of Utilization Management

Evaluating Managed Care

Functional Approach to Evaluating Health Care Plans

Evaluating Managed Care Proposals: Network Adequacy

Evaluating Managed Care Proposals: Quality Assurance

Evaluating Managed Care Proposals: Site Visits

Managed Care Outlook and Evaluation

Development of Defined Contribution Health Plans

Chapter 9. Dental Plan Design

Characteristics of Dentistry


Nature of Care, Cost, and Prevention

Providers of Dental Benefits

Covered Expenses for Dental Treatment

Types of Dental Plans

Scheduled Dental Plans

Nonscheduled Dental Plans

Combination Dental Plans

Incentive Dental Plans

Plans Providing Both Medical and Dental Coverage

Orthodontic Benefits

Implantology Benefits

Factors Affecting the Cost of the Dental Plan

Dental Plan Design

Characteristics of the Covered Group

Sponsor's Approach to Implementation

Claims Administration

Chapter 10. Prescription Drug, Vision, and Hearing Care Plans

Coverage for Prescription Drugs

Traditional Indemnity Coverage

Service Plans with Identification Cards

Mail-Order Prescription Programs

Cost-Management Techniques

Vision Care Benefit Plans

Vision Care Providers

Vision Care Benefits

Vision Care Frequency Limits

Schedule-of-Benefits Vision Care Plans

Preferred Provider Networks for Vision Care

Vision Benefits in Flexible Benefit Plans

Hearing Care Benefit Plans

Hearing Care Benefits

Chapter 11. Disability Insurance

State Compulsory Disability Laws (Workers' Compensation)

Origins of Workers' Compensation

Coverage of Workers' Compensation Programs

Cost of Workers' Compensation Insurance

Workers' Compensation Claims

Types and Amounts of Workers' Compensation Benefits

Employers' Rights under Workers' Compensation Programs

Financing Workers' Compensation Programs

Employer and Employee Tax Obligations

Relationship between Workers' Compensation and Benefit Laws

Disability Insurance

Origins of Disability Insurance

Short-Term Disability Insurance Programs

Long-Term Disability Insurance Programs

Funding Disability Insurance Programs

Employee and Employer Tax Obligations

Relationships between Company-Sponsored Disability Plans and Benefits Laws

Chapter 12. Group Life Insurance: Term and Permanent

Group Insurance Mechanism

Group Term Life Insurance

Term Life Benefits


Group Term Life Insurance Provisions

Dependent Coverage

Coverage of Employees After Retirement

Advantages and Limitations of Group Term Life Insurance

Permanent Forms of Group Life Insurance

Group Paid-Up Life Insurance


Plan Provisions

Premium Rates and Experience Rating

Uses of Group Paid-Up Insurance

Advantages of Group Paid-Up Life Insurance

Limitations of Group Paid-Up Life Insurance

Level-Premium Group Permanent Life Insurance

Group Ordinary Life Insurance

Retired-Lives Reserve

Accidental Death and Dismemberment (AD&D) Insurance

Supplemental Group Life Insurance

Group Carve-Out Life Insurance Plans

Group Universal Life Insurance

Part Three—Retirement Benefit Plans

Chapter 13. Company-Sponsored Retirement Programs: Defined Benefit, Defined Contribution, and Hybrid Plans

Defining Retirement Plans

A Comparison of Qualified and Nonqualified Plans

Minimum Standards for Qualified Plans

Nonqualified Plans

Defined Benefit Plans

Benefit Formulas

Nondiscrimination Rules: Testing

Accrual Rules

Minimum Funding Standards

Benefit Limits and Tax Deductions

Defined Contribution Plans

Individual Accounts

Investment of Contributions

Employee Participation in Investments

Nondiscrimination Rules: Testing

Accrual Rules

Minimum Funding Standards

Contribution Limits and Tax Deductions

Types of Defined Contribution Plans

Section 401(k) Plans

Profit-Sharing Plans

Stock Bonus Plans

Employee Stock Ownership Plans (ESOPs)

Savings Incentive Match Plans for Employees (SIMPLEs)

Section 403(b) Tax Deferred Annuity Plans

Section 457 Plans

Hybrid Plans

Cash Balance Plans

Target Benefit Plans

Money Purchase Plans

Age-Weighted Profit Sharing Plans

Integrating Qualified Pension Plans with Social Security

Integration Methods

Uniform Disparity under the Excess and Offset Approaches

Plans Ineligible for Integration

Chapter 14. Defined Benefit Plan Features

Employee Contributions

Retirement Ages

Normal Retirement Age

Early Retirement Age

Late Retirement Age

Retirement Benefits

Determination of Compensation

Defined Benefit Formulas

Variable Benefit Formulas

Integration with Social Security

Minimum Benefits

Death Benefits

Disability Benefits

The Impact of Inflation on Pensioner Income

Preretirement Inflation

Postretirement Inflation

Equity Pensions

Cost-of-Living Formulas

Wage-Related Formulas

Specified Percentage Formulas

Chapter 15. Plan Termination Insurance for Single-Employer Pension Plans

Plans Covered

Plan Termination Defined

Voluntary Plan Termination

Involuntary Plan Termination

Reportable Events

Date of Termination

Restoration of Plan

Benefits Guaranteed

Prerequisites for PBGC Guarantees

Limitation on Amount of Monthly Benefits

New or Amended Plans and Benefits

Payments in Excess of Unfunded Guaranteed Benefits

Allocation of Assets on Plan Termination

Priority Categories

Reversion of Residual Assets to the Employer

Liabilities on Plan Termination

Distributee Liability-Recapture

Employer Liability

Security Rules for Underfunded Plans

Chapter 16. Cash or Deferred Plans under Section 401(k)

Advantages and Limitations

Legislative History

Technical Requirements

Type of Plan

Individual Limitations

Nondiscrimination in Coverage and Contribution

Safe Harbors—ADP and ACP Testing

Treatment of Excess Deferrals and Excess Contributions

Nonforfeitability Requirements

Limitations on Withdrawals

Separate Accounting


Other Considerations

Social Security

Other Employer-Sponsored Plans

State and Local Taxes

Deduction Limits

Chapter 17. Profit Sharing Plans

Definition of Profit Sharing

Qualification Requirements

Coverage Requirements

Contribution Requirements

Employee Contributions

Allocations to Employee Accounts

Integration with Social Security

Provision for Distributions

Investment Options

Limits on Deductibility of Employer Contributions

Taxation of Distributions

Plan Termination

Chapter 18. Employee Stock Ownership Plans (ESOPs)

ESOP Defined

Simple or Nonleveraged ESOP

Leveraged ESOP

Advantages and Limitations of a Leveraged ESOP

ESOP Qualification Requirements

Employer Securities Requirements

Voting Rights

Rights of First Refusal

Put Options

Valuation of Securities

Nondiscrimination Testing/Integration with Social Security

Diversification Requirements

Section 415

Distribution Requirements

Joint and Survivor Requirements


Deductibility of Employer Contributions

Deferral of Gain on Stock Sales to ESOPs

Chapter 19. Section 403(b) Plans

Internal Revenue Code (IRC) Requirements

Qualified Employers

Eligible Employees

Nonforfeitable Employee Rights


Limitation on Salary Reduction Contributions

Section 415 Limit

Limit on Includible Compensation

Limits on Elective Deferrals

Nondiscrimination Requirements

Annuity Contract Purchased by an Employer

Distributions and Taxation

Minimum Distribution Rules

Taxation of Distributions


Transfers and Rollovers



Chapter 20. Hybrid Retirement Plans

Defined Benefit Hybrid Plans

Cash Balance Plans

Equity Pension Plans

Life Cycle Pension Plans

Benefit Accrual

Distributions, Portability, and Lump Sums

Investment Risk and Reward

The Transition to Defined Benefit Hybrid Plans

Defined Contribution Hybrid Plans

Target Benefit Plans

Age-Weighted Profit Sharing Plans

New Comparability Plans

Nondiscrimination Requirements

Floor-Offset Plans: Two Plans Working as One

Chapter 21. Money Purchase Pension Plans

Characteristics of Money Purchase Plans


Tax Law Provisions

Nondiscrimination in Contributions and Benefits

No Before-Tax Contributions

Integration with Social Security

Section 415 Limitations

Joint and Survivor Requirements


Employer Securities

No In-Service Distributions

Minimum Funding Standards

Deduction Limits

Chapter 22. Investment Arrangements for Group Retirement Plans


Group Insurance Contracts

Deposit Administration Contracts

Immediate Participation Guarantee Contracts

Separate Account Contracts

Guaranteed Investment Contracts (GICs)

Group Annuity Contracts

Group Deferred Annuity Contracts

Individual Policy Pension Trusts

Chapter 23. Individual Retirement Arrangements

General Eligibility and Contribution Limits

Eligibility to Establish IRAs

Contribution Limits for IRAs

Deductibility of IRA Contributions

Nondeductible IRA Contributions

Excess IRA Contributions

Roth IRAs

Qualified Distributions from Roth IRAs

Conversion of a Traditional IRA into a Roth IRA

IRA Funding

Funding an Individual Retirement Account

Funding an Individual Retirement Annuity

Selection of Funding Arrangement

Prohibited Transactions


Required Distributions from Traditional IRAs

Taxation of Qualified Distributions from Traditional IRAs

Premature Distributions from IRAs

Conditions Exempting IRA Distributions from Penalty Taxes

Rollovers Permitted between Qualified Plans

Employer-Sponsored IRAs

Deemed IRAs

Reporting and Disclosure Requirements

Chapter 24. Retirement Plans and Benefits for Executive Employees

Defining and Exploring Executive Benefits

Enhanced Benefits for Executives

Criteria for Executive Status

Hallmarks of Executive Retirement Benefits


Tax Status: Qualified versus Nonqualified Plans

Funding Status

Mandatory Retirement Age

Nonqualified Retirement Plans for Executives

Excess Benefit Plans

Supplemental Executive Retirement Plans (SERPs)

Contrasting Excess Benefit Plans and SERPs

Funding Mechanisms and Tax Obligations

General Assets

Corporate-Owned Life Insurance

Split-Dollar Life Insurance

Rabbi Trusts

Secular Trusts

Employee-Owned Annuities

Stock Option Plans

Incentive Stock Options

Nonstatutory Stock Options

Restricted Stock

Phantom Stock

Discount Stock Options

Stock Appreciation Rights

Reporting Requirements

U.S. Department of Labor

Securities and Exchange Commission

Nonretirement Benefits for Executives

Enhanced Protection Programs


People Who Set Executive Benefits

Executive Compensation Consultants

Board of Directors

Compensation Committee



Course Format

LOMA 380 will only be available through the end of 2015.

Study materials include print textbooks and Test Preparation Guides (TPGs) with printed and electronic versions of the course's Practice Questions and Sample Exam. Enrollment for an I*STAR, Prometric or Paper exam is purchased separately through LOMANET.

Exam Format

I*STAR Exams

I*STAR (Individually Scheduled Test and Results) is LOMA's Internet-based system for providing computerized exams. I*STAR testing is available to students at companies that have installed this testing system. Advantages of I*STAR include the convenience and flexibility of year-round testing, as well as immediate online grade reporting.

You may take I*STAR exams at Prometric Testing Centers throughout the United States and Canada. Prometric offers students the flexibility of taking exams after regular business hours and on Saturdays.

Study Materials

Employee Benefits (The McGraw-Hill Companies, Inc., 2005)
     ISBN 0-256-89897-9
     PBD Order # 380-10-05

Test Preparation Guide for LOMA 380 (LOMA, 2005)
     ISBN 1-57974-217-3
     PBD Order # 380-40-05

Commercially-published instructor’s kits are made available only to course instructors for LOMA 380. To order, contact LOMA directly.

Ordering printed study materials

For the United States and Canada, you can order study materials for designation courses through PBD by using the form and information below:


PBD Worldwide
P.O. Box 930108
Atlanta, Georgia 31193-0108
Tel: 1-800-887-3723 or 770-280-4178
Fax: 770-280-4150

Additional textbook order forms

Forms include applicable mailing and contact information


Note: Most of the courses require a textbook and a Test Preparation Guide (TPG). Be sure to order all assigned materials as listed in the Education and Training Catalog. Students are responsible for ordering the correct study materials.

How to Enroll

Traditional Course Access

LOMA's traditional-access designation courses teach industry topics using printed study materials and proctored examinations. Study materials include print textbooks and Test Preparation Guides (TPGs) with printed and electronic versions of the course's Practice Questions and Sample Exam. Enrollment for an I*STAR, Prometric or Paper exam is purchased separately through LOMANET.