Information Center

Federal Pension Insurance Protections


In 1974, Congress created a federal pension insurance program for certain private retirement plans. This program is administered by the Pension Benefit Guaranty Corporation (PBGC).

What plans are protected by the PBGC?

Most traditional private pension plans, commonly known as defined benefit plans, are protected by the PBGC, but not all. For example, certain plans covering only top executives or funded only by union dues contributions are not insured. Other uninsured plans include those of religious organizations that have chosen not to be covered by the private pension law, and plans set up by doctors, lawyers, architects, engineers and other professionals that have 25 or fewer employees.

What benefits are protected by the PBGC?

If a company’s plan is underfunded and the company goes into bankruptcy or terminates the plan for another reason, the PBGC will step in. Most retirees will receive the full benefits they earned, and their widows and widowers will also be protected. But there are important exceptions. These exceptions generally affect those individuals with the largest benefits, or benefits that have been recently increased. For example:

  • There is a ceiling on the dollar amounts that are guaranteed.
    • For people with single employer plans that terminated this year (2023), the guarantee limit at age 65 is $6,750 a month, or $81,000 a year.
    • This guarantee amount is lower if you begin receiving payments from the PBGC before age 65 or if your pension includes benefits for a survivor or other beneficiary.
    • For people whose plans end this year (2023) and start receiving benefits at earlier ages, the limit or cap on benefits is reduced for each year you begin receiving benefits before age 65 as follows: 7 percent per year for the first five years and 4 percent per year for the next five years. For example, if you are 55 when you retire, your benefit could be reduced to $3,037 a month or $36,444 a year. This is true even if you retired with a special “subsidized” early retirement benefit.
    • The PBGC guarantee for multiemployer plans is calculated by multiplying the number of years participants have worked under a plan times a percentage of the monthly benefits they have earned under the plan.  There is a maximum guarantee limit of $35.75 in monthly benefits multiplied by years of service. Example: The maximum monthly guarantee for a retiree with 30 years of service is $1,072.50 a month, or $12,870 a year. The guarantee for those with more years of service will be more. For those with fewer years of service and/or a lower monthly benefit, the maximum guarantee will be less. To calculate how much of your benefit is guaranteed read this PBGC fact sheet.
    • To find out the single employer guarantee limits, view this table.
    • The guarantee amount may be higher if you retire after age 65 or if you are over age 65 and receiving benefits when your plan terminates.
    • It is important to note that for single employer plans, the PBGC pays most people all of their pension benefits.
    • Also if there is sufficient funding in the plan at the time a plan terminates, people who have been retired three or more years (or could have been retired three or more years) will get more than the guaranteed benefits — up to their full benefits.
  • No lump sums are available from a PBGC administered plan, even if your plan allowed this form of distribution.
  • Improvements in benefits within five years of a plan’s termination are not fully protected.

For a more detailed description of what benefits are and are not protected, read “Your Guaranteed Pension,” published by the Pension Benefit Guaranty Corporation, Communications and Public Affairs Department, 1200 K Street NW, Suite 240, Washington, DC 20005-4026.

How to contact the PBGC

Call 1-800-400-7242 or 202-326-4000 8:00 am – 5:00 pm Eastern time. E-mail

< Back

Sign up to receive updates from us:

Do you want to stay up to date on the latest retirement news and recent happenings at PRC?

Sign up to receive emails from us:

Click here >

Support the Pension Rights Center:

In today’s challenging pension environment, our work is more important than ever. Your contribution will help make it possible for the Center to continue its crucial role as a national consumer organization committed to protecting and promoting retirement security.

Donate >