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After an annuity commences to an alternate payee, does anyone know how the PBGC limits apply if the plan is terminated in a distress termination? Is the alternate payee's benefit combined with the particpant's benefit in determining the limit or do the limits apply separately?

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Not sure if this is definitive, but look at Q&A15 from 2005 BlueBook:

http://www.pbgc.gov/Documents/2005bluebook.pdf

"Similarly, an individual with respect to whom the plan has benefit liabilities and any alternate payees with respect to that individual would be counted as one participant."

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.

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