Milliman analysis: Multiemployer pension experience remarkable funding swings in the first half of 2020 due to COVID-19 and market volatility – PRNewswire

11August 2020

SEATTLE, Aug. 11, 2020/ PRNewswire/– Milliman, Inc., a premier international consulting and actuarial firm, today launched the outcomes of its Multiemployer Pension Funding Research Study (MPFS) since June 30, 2020, which analyzes the funded status of all multiemployer defined benefit pension plans in the United States.

Since June 30, 2020, the aggregate financed portion of multiemployer strategies dropped to 82%, down from 85% at the end of 2019, leading to a $26 billion boost in the aggregate financing shortfall. The approximated investment return for the first half of 2020 had to do with -1.3%, based on a streamlined portfolio.

In general, over the past 18 months, increased volatility in the markets has caused remarkable swings in the aggregate funded percentage for many strategies. While all plans take in market gains and losses over time, severe market movements right away prior to a plan’s measurement date can have a significant influence on its funding position and annual Pension Security Act (PPA) zone status.

“The past 6 months have actually demonstrated why measurement dates matter,” states Nina Lantz, a principal and consulting actuary at Milliman and co-author of the MPFS. “As of March 31, the approximated year-to-date return on our simplified portfolio had to do with -13.4%. So the 70 strategies in the MPFS with that year-end date will finish their annual valuations and zone certifications when 2020 asset values are at their least expensive for the year so far. This will unfortunately impact their financing position and zone status, regardless of the present market healing in Q2 2020.”

To view the complete research study, go to www.milliman.com/mpfs. To get routine updates of Milliman’s pension funding analysis, call us at [email protected] About Milliman isamong the world’s biggest suppliers of actuarial and related products and services. The firm has speaking with practices in healthcare, property & & casualty insurance coverage, life insurance and financial services, and staff member benefits. Established in 1947, Milliman is an independent company with offices in major cities around the world. For more info check out milliman.com. SOURCE Milliman, Inc.&Related Hyperlinks www.milliman.com

Source: prnewswire.com

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