WASHINGTON — The Pension Benefit Guaranty Corporation (PBGC) announced a new compliance assistance tool that allows potential plan sponsors to evaluate whether a proposed defined benefit plan design would be covered under PBGC’s Single-Employer Insurance Program. The Coverage Assessment Program builds on PBGC’s commitment to provide clear, accessible guidance to employers and their service providers.
Historically, PBGC has allowed established plans to request formal coverage determinations. Now, prospective plan sponsors can also request a coverage assessment letter for a plan that has not yet been created — an important resource for employers, especially small businesses, considering whether or how to establish a new plan.
“PBGC is committed to providing clear, consistent, and practical compliance assistance,” said PBGC Director Janet Dhillon. “By offering coverage assessments, we are giving prospective sponsors — often small plans — the ability to understand coverage implications early, which supports better decision-making and stronger retirement security for workers.”
PBGC previously offered coverage assessments for proposed defined benefit plans through a pilot program that expired in 2022. By reviving the program and making it permanent, PBGC is ensuring continued access to this valuable tool.
Instructions for requesting a coverage assessment letter are available on PBGC’s website.
About PBGC
PBGC protects the retirement security of about 30 million American workers, retirees, and beneficiaries in both single-employer and multiemployer private sector pension plans. The agency’s two insurance programs are legally separate and operationally and financially independent. PBGC is directly responsible for the benefits of nearly 1.4 million participants and beneficiaries in failed single-employer pension plans. The Single-Employer Program is financed by insurance premiums, investment income, and assets and recoveries from failed single-employer plans. The Multiemployer Program is financed by insurance premiums and investment income. Special financial assistance for financially troubled multiemployer plans is financed by general taxpayer monies.