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DB plan sponsors: 2020 PBGC variable-rate premiums are due October 15 – have you checked how you’re calculating them? If you haven’t, you may be overpaying…

If your plan currently uses the standard (spot-rate) method to determine unfunded vested benefits (UVBs) to calculate PBGC variable-rate premiums

And you have the ability to switch to the alternative (24-month average) method

Then you may have the opportunity to reduce 2020 variable-rate premiums

The dramatic declines in interest rates in 2019 and 2020 mean that changing methods could generate significant savings

This election generally must be made (for a calendar plan) by October 15, 2020.

See our article discussing this issue in detail – Measuring UVBs for variable-rate premiums – the alternative vs. standard method election

What to Read Next

Measuring UVBs for variable-rate premiums – the alternative vs. standard method election

Defined benefit plan sponsors that (1) currently using the standard (spot-rate) method to determine unfunded vested benefits (UVBs) for purposes of calculating Pension Benefit Guaranty Corporation variable-rate premiums, and who (2) have the ability to elect to switch to the alternative (24-month average) method, may have an opportunity to reduce (in some cases significantly) 2020 variable-rate premiums by doing so.