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Derisking Pension risk=what is the effect on the pensionee
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Retirement Planning
Derisking Pension risk=what is the effect on the pensionee
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PLease explain what happens when corporations derisk pensions. One corporation sold the pension for a group annuity to an insurance company, the Pension Guarantee Benefit Corp will not be involved if
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Cat:7a9899c6-bb01-48a5-bd56-e73d9d7e3998Forum:f30f5dc6-f3c4-4828-8510-fbe290ff0053
Cat:7a9899c6-bb01-48a5-bd56-e73d9d7e3998Forum:f30f5dc6-f3c4-4828-8510-fbe290ff0053Discussion:0e03c702-884f-4581-b0a3-7282b035e4e0
Forums » Work & Retirement » Retirement Planning » Derisking Pension risk=what is the effect on the pensionee
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Derisking Pension risk=what is the effect on the pensionee
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Derisking Pension risk=what is the effect on the pensionee
posted at October 31, 2012 10:12 AM EDT
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Posts: 2
First: October 31, 2012 Last: October 31, 2012 |
PLease explain what happens when corporations derisk pensions. One corporation sold the pension for a group annuity to an insurance company, the Pension Guarantee Benefit Corp will not be involved if the insurance company cant pay the pensionee. The state guarantee association(insurance companies) will be the regulatory agency. Which state insurance guarantee association will be responsible, the state where the insurance corporation is located or the state where the pensionee resides? What other information can you tell me about this pension derisking? I am writing to inform you about a change we are making regarding the funding and payment of your monthly pension benefit from the Verizon Management Pension Plan. This change will not affect the amount of your monthly pension benefit or the amount of any benefits that may be available to your beneficiaries. Beginning with the transfer of about $8 billion in cash and pension assets to The Prudential Insurance Company of America ("Prudential") in December, 2012, Prudential will assume the responsibility for your pension benefit. Today, your monthly pension benefit is being paid out of the assets in the Verizon pension trust. In December 2012, responsibility for your monthly pension benefit will transfer to Prudential and payments will no longer be made from the Verizon pension trust. Your payments will continue to be processed by Wells Fargo Bank until June 30, 2013. Beginning July 1, 2013, Prudential will be issuing your monthly pension benefit payments. Key Facts About the Transfer of Your Verizon Pension The amount of your monthly pension benefit does not change. Your monthly pension benefit continues to be paid on the same dates each month as it is now. The pension transfer does not affect your eligibility for and participation in any other Verizon retiree benefits. The amount of survivor benefits you selected when you began receiving payments does not change. On July 1, 2013, the issuer of your check or direct deposit will change from Wells Fargo Bank to Prudential. You will be notified in advance of this change taking place. When Prudential takes over responsibility from Verizon, your pension will be protected by the state guaranty fund within your state (as described in the enclosed document titled Special Information Regarding Annuity). The pension transfer will happen automatically − you do not need to take any action. You may be wondering why Verizon has made this decision. Over the years, Verizon has become a money−manager for about $24 billion in funds to pay our pension holders. Managing the pension trust is a complex and expensive obligation that Verizon believes can best be managed outside of Verizon to ensure future obligations are met. Ensuring the timely and safe payment of monthly annuities is the core business of Prudential. This move will allow Verizon to ensure that the pension obligation remains in safe and trusted hands, while allowing Verizon to better focus on its core mission of providing the best communications network around the world. Let me assure you that this decision was made after careful consideration and a thorough review of both our funding obligations and what is legally permissible under the terms of the Plan. Moreover, Verizon has determined that Prudential is well−positioned, based on its expertise, asset base and overall credit worthiness, to assume this financial responsibility. You will have the full financial backing of Prudential and over $250 billion in assets and capital. In addition, your monthly pension benefit will have the backing of state guaranty insurance funds. Prudential has a well−established and strong reputation for providing pension plan services to 3.7 million active workers and retirees. In the next few months, Prudential will mail you additional information, including an annuity certificate describing your right to continued monthly benefit payments from Prudential. Enclosed is a Pension Benefit Statement that provides information about your current monthly pension benefit amount. In addition, enclosed is a list of frequently asked questions about this pension transfer. |
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Re: Derisking Pension risk=what is the effect on the pensionee
posted at October 31, 2012 10:13 AM EDT
|
|
Posts: 2
First: October 31, 2012 Last: October 31, 2012 |
I am writing to inform you about a change we are making regarding the funding and payment of your monthly pension benefit from the Verizon Management Pension Plan. This change will not affect the amount of your monthly pension benefit or the amount of any benefits that may be available to your beneficiaries. Beginning with the transfer of about $8 billion in cash and pension assets to The Prudential Insurance Company of America ("Prudential") in December, 2012, Prudential will assume the responsibility for your pension benefit. Today, your monthly pension benefit is being paid out of the assets in the Verizon pension trust. In December 2012, responsibility for your monthly pension benefit will transfer to Prudential and payments will no longer be made from the Verizon pension trust. Your payments will continue to be processed by Wells Fargo Bank until June 30, 2013. Beginning July 1, 2013, Prudential will be issuing your monthly pension benefit payments. Key Facts About the Transfer of Your Verizon Pension The amount of your monthly pension benefit does not change. Your monthly pension benefit continues to be paid on the same dates each month as it is now. The pension transfer does not affect your eligibility for and participation in any other Verizon retiree benefits. The amount of survivor benefits you selected when you began receiving payments does not change. On July 1, 2013, the issuer of your check or direct deposit will change from Wells Fargo Bank to Prudential. You will be notified in advance of this change taking place. When Prudential takes over responsibility from Verizon, your pension will be protected by the state guaranty fund within your state (as described in the enclosed document titled Special Information Regarding Annuity). The pension transfer will happen automatically − you do not need to take any action. You may be wondering why Verizon has made this decision. Over the years, Verizon has become a money−manager for about $24 billion in funds to pay our pension holders. Managing the pension trust is a complex and expensive obligation that Verizon believes can best be managed outside of Verizon to ensure future obligations are met. Ensuring the timely and safe payment of monthly annuities is the core business of Prudential. This move will allow Verizon to ensure that the pension obligation remains in safe and trusted hands, while allowing Verizon to better focus on its core mission of providing the best communications network around the world. Let me assure you that this decision was made after careful consideration and a thorough review of both our funding obligations and what is legally permissible under the terms of the Plan. Moreover, Verizon has determined that Prudential is well−positioned, based on its expertise, asset base and overall credit worthiness, to assume this financial responsibility. You will have the full financial backing of Prudential and over $250 billion in assets and capital. In addition, your monthly pension benefit will have the backing of state guaranty insurance funds. Prudential has a well−established and strong reputation for providing pension plan services to 3.7 million active workers and retirees. In the next few months, Prudential will mail you additional information, including an annuity certificate describing your right to continued monthly benefit payments from Prudential. Enclosed is a Pension Benefit Statement that provides information about your current monthly pension benefit amount. In addition, enclosed is a list of frequently asked questions about this pension transfer. |
Forums » Work & Retirement » Retirement Planning » Derisking Pension risk=what is the effect on the pensionee
