Bloomberg Surveillance, covering the latest news in finance, economics and investments. If the plan is "overfunded" it will be turned over to an insurance company, which will take over payment of the benefits. Main Office Figuring out whether a company has an underfunded pension plan can beas simple as comparing the fair value of plan assets to the accumulated benefit obligation, which includes the current and future amounts owed to retirees. This compensation may impact how and where listings appear. Got a confidential news tip? New York, NY 10017-4036, Chicago Office The new bill would let pensions borrow money to remain solvent so that they can continue to pay retirees for "decades to come," Neal said at the hearing. People can, however, take loans against their defined-benefit plan. Because of the nature of our Services, we do not solicit or intentionally receive information from children under the age of 16, except that we do collect information regarding dependent children that pertains to their benefits coverage and to beneficiary designations. About 1.3 million Americans could have their retirement funds at risk if these plans cannot come up with the money to pay the benefits people were promised. Tweet An. Meanwhile, the PBGC had a $54 billion deficit in 2018, up from $739 million in 2006. During an economic slowdown,pension plans are susceptible to becoming underfunded. .manual-search ul.usa-list li {max-width:100%;} In the Ascension case, brought by Marilyn Overall, a former employee of an Ascension hospital in Michigan, alleged the pension plans were underfunded by $444.5 million, affecting 122,000. All Rights Reserved. The plan offers retirement services to its eligible employees and maintains savings, investment, and pension plans as tools for associates to create and manage their future financial strategy of Ascension Health, a . Law360 may contact you in your professional capacity with information about our other products, services and events that we believe may be of interest.Youll be able to update your communication preferences via the unsubscribe link provided within our communications.We take your privacy seriously. .agency-blurb-container .agency_blurb.background--light { padding: 0; } [CDATA[/* >