Metropolitan Life Insurance Company (MetLife) has announced today that PPG has entered into an agreement with both MetLife and Massachusetts Mutual Life Insurance Company (MassMutual) to provide annuity benefits to approximately 13,400 retirees in PPG’s defined benefit (DB) pension plans, representing pension obligations of $1.6 billion.
"MetLife is pleased to be working with PPG to remove the risks and liabilities associated with its pension plans," says Wayne Daniel, Senior Vice President, U.S. Pensions, MetLife.
"As a market leader with 90+ years of experience and $38 billion of transferred pension liabilities, MetLife can provide PPG with the security and knowledge that their risks are well-managed and their participants’ benefits are protected."
The transaction involves two groups of retirees – salaried and non-union hourly. For 11,000 salaried retirees, MetLife and MassMutual are each providing 50 percent of the monthly benefits. MassMutual will act as lead administrator.
MetLife will pay its portion of the benefits through an administration agreement with MassMutual. MetLife will be the exclusive provider for the non-union hourly group, making payments directly to the retirees.
The transaction, subject to certain conditions, is expected to close later in 2016. It will be executed with a combination of cash and assets-in-kind. PPG will purchase group annuity contracts from MetLife and MassMutual.
The insurance companies will assume responsibility for making benefit payments to the retirees or their survivors covered by the agreement. The transaction will not change the amount of the monthly benefit received by the affected parties.
MetLife and MassMutual, rather than PPG, will be responsible for making these monthly payments following the close of the transaction; no action is needed by the plan participants.
MetLife, through its subsidiaries and affiliates ("MetLife"), is one of the largest life insurance companies in the world. Founded in 1868, MetLife is a global provider of life insurance, annuities, employee benefits and asset management.