The Pension Benefit Guarantee Corp. has released a proposed rule that would implement a defined benefit plan provision of the Pension Protection Act of 2006 and strengthen an existing ban on paper PBGC premium filings.
The PBGC insures the benefits of U.S. defined benefit pension plans.
One PPA provision will require PBGC-insured single-employer defined benefit plans to pay a variable PBGC insurance premium component based on a plan's funding target and the market value of its assets.
The plans must pay the variable-rate premium along with a flat-rate premium.
The proposed rule would require "unfunded vested benefits to be measured as of the funding valuation date for the premium payment year," PBGC officials write in a preamble to the proposed rule, which appears today in the Federal Register.
Filers would be making a choice, irrevocable for 5 years, to "use funding discount rates for premium purposes instead of the special premium discount rates," officials write.
