Company: MSEX
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0001174947-25-000251
Chunk: 296

Company: MIDDLESEX WATER CO
Filing Date: 2025-02-28
Form: 10-K
Item: Item 1B
Chunk 296
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 experience and assumptions of future experience. Future retirement benefit plan
obligations and expense will depend on future investment performance, changes in future discount rates and various other demographic factors
related to the population participating in the Company’s retirement benefit plans, all of which can change significantly in future
years.

The primary assumptions used for determining future retirement benefit
plans’ obligations and costs, which are reviewed and revised as needed each year, are as follows:

    ●
    Discount Rate - calculated based on market rates for long-term, high-quality corporate bonds specific to the expected duration of our Pension Plan and Other Benefits Plan’s liabilities; 
  
    ●
    Compensation Increase - based on management projected future employee compensation increases;
  
    ●
    Long-Term Rate of Return - determined based on expected returns from our asset allocation for our Pension Plan and Other Benefits Plan assets;
  
    ●
    Mortality - The Company utilizes the Society of Actuaries’ mortality table (Pri-2012) (Fully Generational, IRS Adjusted, Mortality Improvement Scale MP-2021); and
  
    ●
    Healthcare Cost Trend Rate - based on management projected future healthcare costs.

The discount rate, compensation increase rate and long-term rate of
return used to determine future obligations of our retirement benefit plans as of December 31, 2024 are as follows:

    Pension Plan
    Other Benefits Plan
  
    Discount Rate
    5.47%
    5.49%
  
    Compensation Increase
    3.00%
    3.00%
  
    Long-term Rate of Return
    7.00%
    7.00%

For the 2024 valuation, costs and obligations
for our Other Benefits Plan assumed an 8.0% annual rate of increase in the per capita cost of covered healthcare benefits in 2025 with
the annual rate of increase declining 0.15% per year for 2026-2045, resulting in an annual rate of increase in the per capita cost of
covered healthcare benefits of 5.0% by year 2045.

35 

The following is a sensitivity analysis for certain actuarial assumptions
used in determining projected benefit obligations (PBO) and expenses for our retirement benefit plans:

Pension Plan

    Actuarial Assumptions 
    Estimated  Increase/ (Decrease)  on PBO (000s)  
    Estimated  Increase/ (Decrease)  on Expense (000s) 
  
    Discount