Review of pension

[Gary]

A pension plan was terminated and purchased annuities through an insurance co. about 12 yrs ago. Can a person still have rights to obtain plan documents and review his pension calc. Is the insurance co. the trustee who has all files and responsibility of administering plan in accordance w/ provisions? And do we request such documents from the ins. co. in same manner as if it were the plan sponsor?

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[david rigby]

Unlikely that the ins. co. has the needed files, but no harm in asking.

Not sure about the "trustee" part of your question, but my gut feeling is that the ins. co. would not take that role unless they agreed to in the purchase of annuities, and that is not likely unless the annuities were purchased "en masse" as part of a group annuity (i.e. not individual annuities).

If the original plan sponsor still exists, no harm in asking for help, but don't be surprised if no one knows where the files are. Is there an SPD? If so, can it be used to answer the question about how a benefit was calculated? Any idea who the consultant was? If so, ask.

Keep a record of all requests and the results.

[Gary]

The company went bankrupt, the plan was terminated and purchased annuities for all participants and when a participant retires I would think that the participant would get all benefit option info from ins. co. So wouldn't it make sense that the ins. co. is maintaining the plan or is it done some other way?

[david rigby]

No. As you said, the plan was terminated. Therefore, no entity is "maintaining the plan".

However, the insurance company does now have responsibility for payment of benefits. It probably does not have responsibility to track down the individuals when they reach 65 (or whatever retirement age); if the EEs were notified (properly) of the annuity purchase, then the EE must contact the ins. co. to start payment of monthly benefits.

The annuity must contain all the features of the original plan, such as the ability to elect Early Retirement, optional forms of benefit, etc.

[richard]

Even if you do get plan documents and find an error in your benefit benefit amounts, I don't think the insurance company would be liable for the difference; after all, they committed to pay specified benefit amounts based on information provided by your employer.

Technically, your former employer would be liable for any deficiency, but they are bankrupt so that's no help. However, when they went bankrupt, was whatever was left acquired by another company? (If so and if the acquisition was poorly structured, the acquirer may have unknowingly contracted for additional liability.)

I wonder if the PBGC would have any liability here. Technically, the Plan wouldn't have been terminated properly (since all benefits haven't been paid), but there isn't much the PBGC could do to a company that has been bankrupt for 12 years.

You might be able to get plan documents or SPDs from your former coworkers (if any of them saved them from 12 years ago).

Good luck.

[david rigby]

Even though plan sponsors are no longer required to send the DOL a copy of SPDs, it may be possible to obtain a copy of one from them. I suggest contacting the Pension and Welfare Benefits Adminstration (PWBA) agency of the DOL.

Try www.dol.gov/dol/pwba/