['Retirement Benefits']
['Pension Benefits Guaranty Corporation (PBGC)']
11/16/2023
Copyright 2024 J. J. Keller & Associate, Inc. For re-use options please contact copyright@jjkeller.com or call 800-558-5011.
...
(a) Notice requirement—
(1) In general. The plan administrator must provide notices in accordance with this section to each affected party entitled to plan benefits other than an affected party whose plan benefits will be distributed in the form of a nonconsensual lump sum.
(2) Spin-off/termination transactions. The plan administrator must provide the information in paragraph (d) of this section to a person entitled to notice under §§4041.23(c) or 4041.24(f), at the same time and in the same manner as required for an affected party.
(b) Content of notice. The plan administrator must include, as part of the notice of intent to terminate—
(1) Identity of insurers. The name and address of the insurer or insurers from whom (if known), or (if not) from among whom, the plan administrator intends to purchase irrevocable commitments (annuity contracts);
(2) Change in identity of insurers. A statement that if the plan administrator later decides to select a different insurer, affected parties will receive a supplemental notice no later than 45 days before the distribution date; and
(3) State guaranty association coverage information. A statement informing the affected party—
(i) That once the plan distributes a benefit in the form of an annuity purchased from an insurance company, the insurance company takes over the responsibility for paying that benefit;
(ii) That all states, the District of Columbia, and the Commonwealth of Puerto Rico have established "guaranty associations" to protect policy holders in the event of an insurance company's financial failure;
(iii) That a guaranty association is responsible for all, part, or none of the annuity if the insurance company cannot pay;
(iv) That each guaranty association has dollar limits on the extent of its guaranty coverage, along with a general description of the applicable dollar coverage limits;
(v) That in most cases the policy holder is covered by the guaranty association for the state where he or she lives at the time the insurance company fails to pay; and
(vi) How to obtain the addresses and telephone numbers of guaranty association offices from the PBGC (as described in the applicable forms and instructions package).
(c) Where insurer(s) not known—
(1) Extension of deadline for notice. If the identity-of-insurer information in paragraph (b)(1) of this section is not known at the time the plan administrator is required to provide it to an affected party as part of a notice of intent to terminate, the plan administrator must instead provide it in a supplemental notice under paragraph (d) of this section.
(2) Alternative NOIT information. A plan administrator that qualifies for the extension in paragraph (c)(1) of this section with respect to a notice of intent to terminate must include therein (in lieu of the information in paragraph (b) of this section) a statement that—
(i) Irrevocable commitments (annuity contracts) may be purchased from an insurer to provide some or all of the benefits under the plan;
(ii) The insurer or insurers have not yet been identified; and
(iii) Affected parties will be notified at a later date (but no later than 45 days before the distribution date) of the name and address of the insurer or insurers from whom (if known), or (if not) from among whom, the plan administrator intends to purchase irrevocable commitments (annuity contracts).
(d) Supplemental notice. The plan administrator must provide a supplemental notice to an affected party in accordance with this paragraph (d) if the plan administrator did not previously notify the affected party of the identity of insurer(s) or, after having previously notified the affected party of the identity of insurer(s), decides to select a different insurer. A failure to provide a required supplemental notice to an affected party will be deemed to be a failure to comply with the notice of intent to terminate requirements.
(1) Deadline for supplemental notice. The deadline for issuing the supplemental notice is 45 days before the affected party's distribution date (or, in the case of an employee organization, 45 days before the earliest distribution date for any affected party that it represents).
(2) Content of supplemental notice. The supplemental notice must include—
(i) The identity-of-insurer information in paragraph (b)(1) of this section;
(ii) The information regarding change of identity of insurer(s) in paragraph (b)(2) of this section; and
(iii) Unless the state guaranty association coverage information in paragraph (b)(3) of this section was previously provided to the affected party, such information and the extinguishment-of-guarantee information in §4041.23(b)(9).
READ MORESHOW LESS
['Retirement Benefits']
['Pension Benefits Guaranty Corporation (PBGC)']
Load More
J. J. Keller is the trusted source for DOT / Transportation, OSHA / Workplace Safety, Human Resources, Construction Safety and Hazmat / Hazardous Materials regulation compliance products and services. J. J. Keller helps you increase safety awareness, reduce risk, follow best practices, improve safety training, and stay current with changing regulations.
Copyright 2024 J. J. Keller & Associate, Inc. For re-use options please contact copyright@jjkeller.com or call 800-558-5011.