The base annual premium that employers with defined benefit plans pay the Pension Benefit Guaranty Corp. will stay the same in 2011.
The base annual premium will remain at $35 per plan participant next year. By law, premium rates are adjusted to reflect changes in the national average weekly wage during the prior year. Because wages were flat, there was no adjustment to the premium.
In fiscal 2009, the last year for which information is available, the PBGC collected nearly $1.13 billion in base premiums in its single-employer insurance program and just less than $700 million in variable-rate premiums that are paid by employers with underfunded plans.
The premiums are used to help pay benefits to participants in plans taken over by the PBGC, which had a $21.1 billion deficit in its single-employer insurance program in fiscal 2009.
Separately, the maximum benefit that the PBGC will guarantee to participants who retire at age 65 and are in plans the agency takes over next year will be $54,000 a year, also unchanged from this year.
Jerry Geisel is editor-at-large at Business Insurance, a sister publication of Pensions & Investments.
