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Esta página no ha sido traducida. Por favor vaya a la página principal del sitio de español de PBGC para ver información disponible en español.

# Projections Report FAQs

General Projections Report Questions

##             What is the Projections Report?          

                                        - The Projections Report provides multi-year projections of the financial condition of PBGC's Single-Employer and Multiemployer Insurance Programs.
                                        - The projections are estimates, not predictions — PBGC's computer models run hundreds of differing economic scenarios, resulting in a range of possible outcomes.

##             How does the Projections Report differ from PBGC's Annual Report?          

                                        - The Annual Report shows PBGC's current financial position as of the end of the fiscal year.
                                        - The Projections Report starts from the current financial position and then simulates PBGC's financial condition 10 years into the future and beyond under many different economic scenarios.

Multiemployer Plans / Program

##             What is a multiemployer plan?          

                                        - A multiemployer plan is a collectively bargained pension plan involving two or more unrelated employers, usually in a common industry, such as construction, supermarket chains, trucking, textiles, or coal mining.  
                                        - Multiemployer plans vary in size from small local plans covering a few hundred participants, to large regional or national plans covering hundreds of thousands.
                                        - Multiemployer plans typically involve only one union.
                                        - Multiemployer plans are funded from:                                           - employer contributions;
                                          - "withdrawal liability" payments from employers that leave the plan before their legal share of plan obligations has been funded; and
                                          - investment earnings on plan assets. 

##             What impact does The American Rescue Plan Act of 2021 (ARP) have on multiemployer plans and PBGC’s Multiemployer Program?          

                                        - ARP provides Special Financial Assistance (SFA) to financially troubled multiemployer plans based on specific criteria set by statute. 
                                        - The number of plans that will ultimately be eligible and amount of SFA to be paid is not known with certainty, but the mean projections estimate $82.7 billion payable to 197 plans.
                                        - ARP is projected to extend the solvency of the Multiemployer Program – the new median projection results in the Multiemployer Program remaining solvent beyond FY 2061.

##             What is the maximum multiemployer benefit guarantee?          

                                        - PBGC's maximum benefit guarantee is set by law. The agency guarantees only vested benefits, which are benefits that a person has earned a right to receive and that generally cannot be forfeited.
                                        - PBGC's Multiemployer Program guarantee is complicated and difficult to summarize quickly. The guarantee sometimes is summarized as a maximum guarantee amount of $12,870 per year (payments are made monthly).                                           - But that is only a special case, and applies to people who worked exactly 30 years in jobs covered by the plan and have a moderately high promised benefit. 
                                        - If a person has:                                           - 10 years of service – PBGC's guarantee covers a benefit of up to $1,320 and partially covers benefits in excess of that level but cannot exceed $4,290 per year.
                                          - 20 years of service – PBGC's guarantee covers a benefit of up to $2,640 and partially covers benefits in excess of that level but cannot exceed $8,580 per year.
                                          - 30 years of service – PBGC's guarantee covers a benefit of up to $3,960 and partially covers benefits in excess of that level but cannot exceed $12,870 per year. 

For more information about the multiemployer guarantee and examples, see PBGC's Multiemployer Fact Sheet and PBGC's 2015 report titled PBGC's Multiemployer Guarantee.

##             What happens if PBGC's Multiemployer Insurance Program runs out of money?          

                                        - ARP significantly extends the solvency of PBGC’s Multiemployer Program.
                                        - Reflecting the significant monetary relief provided under ARP, the new median projection results in the Multiemployer Program remaining solvent beyond FY 2061.
                                        - If the Multiemployer Program were to run out of money, PBGC would not be able to provide financial assistance to failed plans so that they can pay benefits at the current PBGC-guarantee level.
                                        - Under current law PBGC would be allowed to ask Congress for additional premiums, but if Congress did not act, guarantees would be cut very significantly.
                                        - Many retirees in failed plans would see their benefits reduced because PBGC's guarantees would be cut.	                                           - The only money that PBGC could use to help failed plans would be premium payments from multiemployer plans. 

Single-Employer Plans / Program

##             What is a single-employer plan?          

                                        - A single-employer plan is generally a pension plan sponsored by one company or a group of companies under common ownership. The plan may or may not be collectively bargained.
                                        - In addition, "multiple employer plans" — that is, plans sponsored by two or more companies that are not under common ownership and that are not collectively bargained — are subject to many of the same rules as single-employer plans and are included in PBGC's Single-Employer Pension Insurance Modeling System (SE-PIMS) for the Single-Employer Program.

##             What is the maximum single-employer benefit guarantee?          

                                        - PBGC's maximum benefit guarantee is set each year by law. We guarantee only vested benefits, which are benefits that a person has earned a right to receive and cannot be forfeited.
                                        - The maximum guarantee that applies to a plan is fixed as of the year of the plan's termination date. A special rule applies, however, if the plan sponsor (usually the employer) filed a petition for bankruptcy protection on or after September 16, 2006.                                           - Under this rule, if the plan sponsor is still in bankruptcy when the plan ends, the maximum guarantee is fixed as of the year in which the plan sponsor filed for bankruptcy. 
                                        - The single-employer benefit guarantee for a plan participant also depends on the age when he or she begins receiving payments from PBGC and the form of payment he or she elects.                                           - For 2021 terminations (or bankruptcies if the above-noted rule applies), the guarantee can cover all or most of a 65-year-old retiree's benefit up to $72,409 per year.
                                          - The guarantee is lower if a retiree begins receiving pension payments from PBGC before age 65 or if the pension includes benefits for a surviving spouse or other beneficiary.
                                          - The guarantee can be higher if a retiree begins receiving payments from PBGC after age 65.  	For more detailed information, see PBGC's Maximum Monthly Guarantee Tables.
                                        - There are other potential limits on pension benefits — see  Benefits PBGC Guarantees .

##             What is "risk transfer" and do your projections anticipate it?          

                                        - Risk transfer occurs, for example, when a plan offers to pay certain former employees a one-time lump sum now instead of a monthly benefit starting at a later date, or the plan transfers monthly payment obligations to an insurance company, which is then responsible for the payments.
                                        - Risk transfer affects both future premium collections and future claims.
                                        - The Projections Report has been updated to take into account routine risk transfers by companies in its assumptions, such as lump sum elections by participants who leave active employment in hybrid plans. Additionally, beginning with the 2020 report, the projections incorporate modeling of voluntary standard terminations. PBGC is actively investigating the trend of non-routine risk transfers through lump sum windows and non-termination annuity purchases, and intends to provide additional information on the sensitivity of the projections to this assumption.

September 13, 2022

## FAQ Resources

## Workers & Retirees

General FAQs About PBGC

Your PBGC Benefit Options

Online Transactions: My Pension Benefit Access (MyPBA) FAQs

Multiemployer Insurance Program Facts

## Practitioners

Online Premium Filing With My PAA

Standard Terminations

Distress Terminations

PBGC-Initiated Terminations

How to Handle Missing Participants

## Press & Policymakers

Premiums

Plan Funding

4062(e) Enforcement Pilot Program

How PBGC Operates