Ex-employees sue Verizon over pension transfer deal with Prudential, RGA
January 7, 2025 by John Hilton
A group of ex-Verizon employees filed the latest lawsuit challenging the efficacy of insurance companies managing pension funds.
Filed Monday in the Southern District of New York, the Verizon pensioners claim the pension risk transfer (PRT) deal agreed to in March threatens their retirement funds. Verizon inked the $5.9 billion PRT deal for Prudential Financial and Reinsurance Group of America to manage the pensions of 56,000 Verizon retirees and their beneficiaries.
Wink’s Moore on the Market: I am not sure that I understand how a fiduciary can suggest transferring pension assets to annuities, when the employees will no longer regulated by ERISA or insured by the Pension Benefit Guaranty Corporation, if that occurs?
If the annuity company becomes insolvent, the “safety net” is much less effective than that provided through the PBGC…
At any rate, this is the first Pension Risk Transfer (PRT) lawsuit that I have seen involving Prudential Financial. I have seen a number of cases involving Athene, that said.
Pru isn’t named in the case, but Verizon and the fiduciary, State Street Global Advisors Trust Company, are.
Thanks John Hilton with InsuranceNewsNet, for the 411. -sjm
