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or at any time after July 1, 1996. The partnership agreement
provided for payments to be made to a doctor’s PC in case the
doctor became disabled.
IV. STEP
A. Overview
STEP purports to provide eligible employees with severance
benefits, funded entirely by their participating employer through
the purchase of whole life insurance policies, and, if elected,
an employer-provided optional life insurance benefit payable upon
the death of a covered employee or an alternate insured.5 STEP
invested the contributions made to the STEP plan in whole life
insurance policies issued by eight insurance companies; namely,
Metropolitan Life Insurance Co. (MetLife), Allmerica Financial
Life Insurance and Annuity Co., National Life Insurance Co. of
Vermont, Prudential Life Insurance Co. of America, Equitable Life
Assurance Society of the United States, ITT Hartford Life
Insurance Co., New York Life Insurance and Annuity Corp., and
Massachusetts Mutual Life Insurance Co. The life insurance
policies insured the individuals covered by the STEP plan, and
the STEP plan assets, as reported, consisted largely of the cash
values of those policies. Insurance agents earned substantial
5 An employee’s severance benefits were paid from the cash
value of his or her whole life insurance policy.
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Last modified: March 27, 2008