PBGC revives coverage assessment program for new DB plans 

The Pension Benefit Guaranty Corp. (PBGC) is once again issuing coverage assessment letters to employers considering offering a new defined benefit (DB) plan. Coverage assessment letters let employers know in advance whether a proposed DB plan will be covered by PBGC’s single-employer insurance program. Most private-sector, tax-qualified DB plans are covered by the insurance program unless they meet one of a few exemptions. Coverage assessment letters address the coverage or noncoverage of a proposed plan under either of the following exemptions:

• The plan sponsor is a professional service employer.
• All plan participants will be substantial owners. 

Other exemptions exist, but PBCG makes coverage determinations on those exemptions only for established plans.

In the past, PBGC generally issued only coverage determinations for established plans. However, under a pilot program offered from 2019 to 2022, PBGC issued coverage assessment letters on whether proposed plans would meet the exemptions for professional service employers and substantial owner plans. The agency has now made these coverage assessment letters a permanent part of its coverage determination program.

PBGC also recently published a new set of frequently asked questions on its website addressing some of the most common questions about coverage determinations and assessments. The FAQs address such issues as the information PBGC will need to make its determination, and how to appeal a coverage determination.

• PBGC launches Coverage Assessment Program (PBGC, August 10, 2026)
• PBGC insurance coverage (PBGC)
• Coverage determination or assessment frequently asked questions (PBGC)

• PBGC again extends pilot program for coverage determinations (October 14, 2021)