Pension Protection Act Update

2019 PPA Update – September 2018

 

The following update provides 2019 PPA estimates for the lump-sum form of distribution (commuted benefit) for participants in The Lubrizol Corporation Pension Plan. Lubrizol’s actuaries have supplied a comparison showing the percentage variation between lump sum values under the current 2018 PPA factors and projected 2019 PPA factors by age (55 through 70). The 2019 PPA Comparison chart shows the impact of this change, a decrease in lump sum values at all ages. The projected decrease in lump sum values for 2019 is mainly due to higher interest rates at all levels and their impact on 2019 lump sum factors.

Click here to view the 2019 PPA Comparison Chart.

 

Multiplying the percentage corresponding to your age in the chart times the lump sum amount from your current PensionPath projection will provide you the estimated decrease in your lump sum amount due to the PPA factor changes (example: 5% x $400,000 = $20,000 reduction). Other factors such as service, pay, age, etc. may also have an impact on your lump sum calculation.  The projected change in lump sum factors considers any current update to the mortality tables. 

The PensionPath system has not yet been updated.  Thus, your benefit or HR representative cannot request calculations for 2019 (based on the 2019 PPA factors).  At this time, the best approach regarding the estimated change in your 2019 lump sum is to use the methodology noted above.  We will advise everyone once the system upgrade is complete.

If you have any questions, please contact your site benefits or human resources representative. Or
click here to view frequently asked questions.