Even though pension risk transfer is better understood by plan sponsors, LIMRA hopes pending legislation that would open multiple employer plans to more employers will create an opportunity for greater plan access.
Tag: pension risk transfer
Announcements by the company provide an example of common steps and the timeline for a pension risk transfer.
Beginning in the third quarter, pension annuity customers whose accounts came to OneAmerica through a pension risk transfer (PRT) will be able to see to their account, make banking changes, change tax withholding, and manage their beneficiary information.
Data from LIMRA Secure Retirement Institute shows a 240% increase in pension risk transfer activity in the first quarter of 2019 relative to the same period in 2018.
A pension risk transfer (PRT) to terminate a defined benefit (DB) plan reflects heavily on a plan sponsor’s balance sheet, which may stop in its tracks a decision to do so.
The firm has transferred $750 million in pension obligations to American General Life Insurance Company, part of AIG’s life and retirement business.
Both active annuitants and deferred annuitants can go to MassMutual’s website to access information about their annuity, as well as update their records, among other things.
Pension plans’ funding rose a mere 70 basis points last year, according to Goldman Sachs Asset Management.
J.P. Morgan’s “Corporate Pension Peer Analysis 2018,” says 2018 was the largest asset allocation de-risking year for defined benefit (DB) plans since 2011.
“A big driver of the 2018 buy-out sales was a combination of mid- to large-PRT deals,” says Eugene Noble, research analyst, LIMRA Secure Retirement Institute. “We also saw two new insurance companies enter the PRT market this year.”
The IRS had previously put a halt to the practice of defined benefit (DB) plan sponsors offering lump-sum windows to retirees in pay status, saying it intended to amend regulations so that such an acceleration of payments would not be allowed.
The company announced one annuity buy-out transaction and one annuity buy-in transaction.
Sixty-seven percent of defined benefit (DB) plan sponsors polled say they will conduct an annuity buyout to de-risk, and the majority of them have already taken actions to prepare.
MetLife has been accused of failing to take sufficient measures to locate annuitants, declaring them dead and transferring the assets for their benefits to the firm.
Mercer recommends 10 areas of focus for defined benefit plans in 2019.
There are goals and deadlines during the termination process, so a plan sponsor doesn’t want to hit a roadblock and have to start the process all over again.
The firm is terminating its pension plan via a combination of lump-sum distributions and an annuity purchase.
Scripps Chief Financial Officer Lisa Knutson says the pension risk transfer agreement is “another move in the company’s effort to de-risk its pension plan.”