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A New Addition to the Wind-Up Regime?

Simon Archer, Susan Philpott & Clio Godkewitsch

July 14, 2017

A New Addition to the Wind-Up Regime?  Pension and Benefits Monitor, June 2017, pp. 38-40

In this article, Simon, Susan and Clio discuss a problem they see with the current wind-up rules in pension legislation.

Where a defined benefit plan is to be wound-up, individual beneficiaries must choose between (1) purchasing a life annuity in the amount of their benefit; (2) transferring the commuted value to another retirement savings vehicle; or (3)  transferring to another plan. The default rule, in the event a beneficiary does not make an election, is the purchase of an annuity.

This is where they believe the system is not working very well. They explain that forced annuitization in a wind-up process creates costs that could be avoided – costs that individual beneficiaries are almost certain to ultimately bear.

They propose an alternative option: the establishment of an independent, not-for-profit institution with a mandate to administer pension plans transferred to it. Click on the link to find out why they think this is a good idea.



Simon Archer, Susan Philpott, Clio Godkewitsch

Practice Areas

Pension & Benefits Law