Blackout Period

What Does Blackout Period Mean?

A blackout period is a temporary period, typically lasting about 60 days, during which an individual has limited or no ability to make changes to their investment or retirement plans. For group benefits offered by employers, blackout periods must be transparent and cannot occur unless they are announced in advance.

Insuranceopedia Explains Blackout Period

Blackout periods on group benefits restrict the recipient’s access to what is owed to them. However, the goal is not to simply inconvenience them; rather, these periods are designed to prevent corporate insiders from unfairly benefiting (intentionally or unintentionally) from stock market trades.

Blackout periods can also arise from company restructuring or changes to benefit plans. For example, there may be a blackout period while assets are transferred from one financial firm to another.

A corporation may impose a blackout period solely on key executives or apply it more broadly to a group of employees.