Benefit Communications in an Electronic World

View This Newsletter: Benefit Communications in an Electronic World


With communication mediums like email, text, and IM’s becoming the standard in business industries worldwide, plan sponsors are becoming increasingly interested in abandoning paper processes for a more electronic means of communication with plan participants and beneficiaries.

  • Common Participant Communications Acceptable via Electronic Delivery
    • Summary Plan Description (SPD)
    • Summary of Material Modifications (SMM)
    • Summary Annual Report (SAR)
    • 401(k) Safe Harbor Notice
    • Black Out Notice
    • Fee Disclosure Notices
    • Qualified Default Investment Alternative Notice (QDIA)
    • Automatic Enrollment Notices
    • 404(c) Notice
  • Acceptable Methods of E-Delivery and their Requirements
    • Email
    • Attachment to email
    • Posting a link to documents posted on a web site
    • Provision of documents on magnetic disk, CD-ROM, or DVD
    • Take appropriate steps to ensure that the system for furnishing electronic documents results in actual receipt of the transmitted information
    • Provide notice to each recipient at the time e-documents are delivered regarding the significance of the document.
    • E-documents must contain all required information and, upon request, participants must be provided a paper version of the document.
    • The system must be designed to protect the confidentiality of the personal information of the participant who receives the information.
  • Participant Consent
    • For those who wish to comply with Safe Harbor e-delivery, the rules identify two categories of participants; those who are “Wired at Work” and those who must give “Affirmative Consent” to receive electronically delivered documents.
    • To be considered “Wired at Work”, the participant must: be able to effectively access e-documents and access the employer’s electronic information system
    • For those not wired at work, “Affirmative Consent” from the participant is required. In order for the participant to give consent, the following information is required: types of documents to which the consent applies; knowledge that consent can be withdrawn; be able to demonstrate the ability to receive e-delivered documents; the right to request paper versions of any e-document; all hardware and software required for accessing the e-delivered documents; and the participant has to provide an electronic address for the e-delivery of documents.
  • The Benefits of Electronic Delivery
    • In a world equipped with computers, smartphones, tablets, and other devices, electronic communications provide flexibility and convenience of access to plan information immediately and continuously.
    • Allowing participants to interact with their accounts anywhere they can connect to the internet and with the use of whichever delivery system they prefer.
    • The participants’ ability to instantly retrieve documents that they have lost, or neglected to save, when using certain types of e-delivery.
    • E-documents easily adjust in font size, or can be read out loud via text to talk apps, for the visually impaired and even translated for those that call English their second language.
    • Simply put, utilizing an electronic platform to send and receive plan information means cost reduction and less waste.
    • While hacking, or data breaches, are often thought to be a risky proposition in electronic communications, the truth is e-delivery is safer than paper-based delivery.
  • Conclusion
    • The substantial advantages today for the electronic delivery of important financial information illustrate how e-delivery is quickly becoming highly preferable to its paper counterpart.
    • A variety of delivery methods, when instituted with proper compliance, represent a safe, efficient, and cost effective move towards better retirement plan communications.


Pinnacle Plan Design is a third-party administrator (TPA) for employer-sponsored qualified retirement plans. We specialize in retirement plan design, administration and actuarial consulting for 401(k)/profit-sharing plans, defined benefit plans, cash balance plans, and 403(b) plans. Pinnacle Plan Design proudly serves businesses nationwide.
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