Regulating Single Employer Defined Benefit Pension Plans: A Modern Approach

30 Pages Posted: 2 Nov 2005

Date Written: 2005

Abstract

Recent financial market and plan termination experiences have exposed the shortcomings of existing funding, disclosure, and premium rules governing private single-employer defined benefit pension plans in the United States. These rules were designed to provide predictability for plan sponsors and administrators, by insulating pension plans from the realities of economic and financial market fluctuations. Unfortunately current practice often overlooks key financial principles that arguably should inform a responsible set of pension rules and the insurance system backing the plans. We outline the key characteristics of pension plans needed to beneficially guide rule-making and offer examples drawn from proposed funding and premium rules.

Suggested Citation

Warshawsky, Mark J., Regulating Single Employer Defined Benefit Pension Plans: A Modern Approach (2005). Pension Research Council WP2005-12, Available at SSRN: https://ssrn.com/abstract=830025 or http://dx.doi.org/10.2139/ssrn.830025

Mark J. Warshawsky (Contact Author)

Towers Watson ( email )

Arlington, VA
United States

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