Prohibited Transaction Class Exemption 1992-6: Sale of Individual Life Insurance or Annuity Contracts by an Employee Benefit Plan

PTE 92-6 exempts from the prohibited transaction restrictions the sale of individual life insurance or annuity contracts held by an employee benefit plan to: (1) plan participants under such plan; (2) relatives of such participants under such plan, (3) employers, any of whose employees are covered by such plan; (4) other employee benefit plans that have a party in interest relationship; (5) owner-employees (as defined in Code section 401(c)(3)), (6) shareholder-employees (as defined in Code section 1379 of the Internal Revenue Code of 1954 as in effect on the day before the enactment of the Subchapter S Revision Act of 1982), or (7) trusts established by plan participants of such plan or relatives of such participants who are the beneficiaries under such plan, for at least an amount equal to the amount necessary to put the plan in the same cash position as it would have been had it retained the contract, surrendered it, and made any distributions owing to the participant on his or her vested interest under such plan, provided certain conditions set forth in the class exemption are met. Plans utilizing the exemption are required to inform the insured participant of a proposed sale of a life insurance or annuity policy to the employer, a relative, a trust, another plan, an owner-employee, or a shareholder-employee and be given an opportunity to purchase such contract.

The latest form for Prohibited Transaction Class Exemption 1992-6: Sale of Individual Life Insurance or Annuity Contracts by an Employee Benefit Plan expires 2026-05-31 and can be found here.