Guest nikomendy Posted April 23, 2002 Share Posted April 23, 2002 Have several high-level questions regarding single-employer db plan termination and PBGC "takeover" versus normal reversion (a) Have yet to see a case where a plan was takenover by pbgc- and the plan sponsor had not gone bankrupt or liquidated. Is this generally the case... or can a plan sponsor simply let a funded plan become unfunded (underfunded) to avoid steep reversion on surplus.. and simply "cut and run" by letting the pbgc cover it, assuming all of the pbgc premiums were paid up and in order? (B) Separate and a part from premiums collected, does the PBGC effectively play "robin hood", from a collection of terminated plans ? Example: a large plan(A) only slightly underfunded, with assets in place to cover most of its plan option pre-65 retirees and post 65 retirees is taken over. Another large plan(B) with only post 65, demographic, is massively undefunded and is taken over. Does the pbgc- in effect- with its pre-65 payout reductions, cut the retirees from plan (a), and use these gains to cover post 65 retirees from plan (B)..?. although in the case described Alot of the asset recovered from plan (a), was in place to cover nearly all of the early retirees from plan (a). Link to comment Share on other sites More sharing options...
david rigby Posted April 23, 2002 Share Posted April 23, 2002 Not sure I know what you are asking. But don't ever expect the PBGC to "bail you out." I agree that a PBGC takeover will likely occur when the plan sponsor is no longer viable. I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now