How are premiums set and why have they recently changed?
PBGC has three sources of premium income—a flat-rate premium, a variable-rate premium, and a termination premium. The rates for all three are set by law. Flat-Rate Premium The flat-rate premium is a per-participant premium that plans pay to PBGC each year. From 1991 through 2005, Congress set the flat premium rates at $19.00 per participant for insured single-employer plans and $2.60 per participant for insured multiemployer plans. The Deficit Reduction Act of 2005 (DRA) increased the single-employer rate for 2006 to $30.00 per participant and the multiemployer rate to $8.00 per participant. It further provided that, thenceforth, these rates would be indexed to increases in the average national wage, as determined by the Social Security Administration, and then rounded to the nearest whole dollar. In 2008, the rate for the flat premium is $33.00 per participant in insured single-employer plans, while that for multiemployer plans is $9.00 per participant. The comparable rates for 2009 w
