Westminster Consulting Brochure Defined Contribution & Defined Benefit | Page 24

Defined Benefit Plans:
A Changing Landscape
excerpts from

A Transamerica Study

Regardless of strategic intent, it appears plan sponsors equipped
with a thoughtful strategy coupled with an efficient operating
platform are often in a better position to achieve stated goals:
• More confident in the accuracy of transactional
processes
• More confident that the data management practices
minimize business risk
• Less concerned about the financial volatility of their
plan, and a range of financial issues
• Easier access to pertinent data
The strategies plan sponsors deploy
(freezing the plan, implementing a
Currently, more than oneliability-driven investment policy,
quarter of DB plan sponsors
outsourcing services) to address
have already implemented
plan shortcomings do not solve
the issue of rising premium cost.
Total Retirement Outsourcingsm,
Concern over premium cost can
and an additional 13% are
only
lead to an increase in the
currently implementing it. An
number
of plan terminations: the
additional 17% are considering
PBGC
seems
caught in a vicious
the option.
cycle.

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A majority make information
available to participants in
electronic form (participant
website: 61% and/or electronic
benefit statements: 56%), but
many don’t provide this level
of access, impeding their ability
to develop appreciation for the
plan.

Over four in ten
perform benefit
calculations inhouse using a fully
automated system,
and one-third of those
outsource the function
using a fully automated system,
some use a combination.

Participant websites are designed primarily for functions that
complement the principal functions of a contact center, such as:
• Answering questions related to plan and
benefits (75%)
• Providing estimated benefit calculations (70%)
• Informing participants about their plan and
benefits (66%)
In the absence of trained and experienced staff to perform
administrative functions, many DB plan sponsors resort to the
outside world for assistance. For help, they turn primarily to
Investment managers (49%) and pension administrators (43%).
Fewer contract plan functions to actuarial consultants (25%),
investment consultants (23%), or ERISA attorneys (18%).