Verizon Pension Plan

Associates plan (CWA/IBEW union employees): Basic Monthly Benefit = Pension Band Amount x Years of Pension Accrual Service. The Pension Band is a fixed dollar amount per month determined by job classification. A supplemental benefit based on eligible compensation over the final 36 months of employment may be added. Full unreduced benefits are available at age 65 with 10+ years of service, or when age + service is at least 76 points (Rule of 76); 30+ years of service waives all early retirement reductions regardless of age. The Verizon Management Pension Plan (EIN 13-1675522, fully frozen since June 30, 2006) used a cash-balance structure crediting a percentage of eligible pay annually plus interest credits; no new credits since the freeze.

This is general educational information about how the plan's formula works, not a calculation of your individual benefit. Your actual benefit depends on your service, pay history, and the plan terms in effect during your employment.

The Verizon Pension Plan for Associates was closed to new union employees under the 2012 collective bargaining agreement (some sources reference an August 3, 2008 net-credited-service cutoff for pension eligibility); existing participants continue to accrue benefits. The Verizon Management Pension Plan (cash balance, EIN 13-1675522, 62,044 participants per 2024 Form 5500) was fully frozen to all future benefit accruals effective June 30, 2006 (announced December 2005), affecting approximately 50,000 management employees who transitioned to defined-contribution arrangements. No management employee has accrued new pension credits since June 30, 2006. The 2024 PRT moved payment obligations for 56,000 retirees from both plans to Prudential and RGA.

A frozen pension does not disappear. Benefits already earned are generally protected and continue to be paid under the plan's terms. A freeze changes whether new benefits accrue going forward, not whether existing benefits are honored.

Verizon has executed two major pension risk transfers. (1) December 2012: Verizon transferred approximately $7.5 billion from the Verizon Management Pension Plan to Prudential via a single-premium group annuity contract, covering approximately 41,000 management retirees who retired before January 1, 2010; current employees and post-2009 retirees were not affected. (2) March 2024: Verizon transferred $5.9 billion ($3.8 billion to Prudential Insurance Company of America, $1.9 billion to RGA Reinsurance Company) from both the Associates and Management plans, covering approximately 56,000 retirees and beneficiaries whose benefits commenced before January 1, 2023. Verizon contributed approximately $365 million to the plans before closing to maintain funded ratios. Prudential assumed administrative responsibility; monthly annuity payments transitioned to the insurers beginning July 1, 2024.

In a pension risk transfer (PRT), an employer transfers some or all of its pension obligations to an insurance company through a group annuity contract. If your benefit was transferred, your monthly payment generally stays the same, but the company paying it changes, and PBGC insurance is replaced by state insurance guaranty association coverage. For this plan, the counterparty was Prudential Insurance Company of America; RGA Reinsurance Company (2024).

What happened to the Verizon pension after the 2024 Prudential and RGA deal?

For the approximately 56,000 retirees and beneficiaries who began receiving benefits before January 1, 2023, monthly pension payments now come directly from Prudential Insurance Company of America and RGA Reinsurance, not from Verizon. The benefit amount is unchanged, and ERISA protections were replaced by state insurance guaranty coverage. Active Associates plan participants who have not yet retired remain in the Verizon-administered plan and continue to accrue benefits.

When was the Verizon Management Pension Plan frozen, and who was affected?

Verizon announced the freeze in December 2005; accruals stopped for all approximately 50,000 non-union management employees on June 30, 2006. No management employee has earned new pension credits since that date. In December 2012, Verizon transferred $7.5 billion of management retiree obligations to Prudential for about 41,000 retirees who retired before 2010, and the 2024 PRT extended coverage to additional management and Associates plan retirees.

Can Verizon Associates pension participants take a lump sum?

Yes. The Associates plan offers a lump-sum distribution calculated using prescribed interest rates and standard mortality tables, so the value fluctuates with prevailing interest rates, with higher rates reducing lump-sum values. Alternatively, participants may choose a Single Life Annuity or four joint-and-survivor annuity options providing 50%, 60%, 70%, or 75% benefit continuation to a surviving spouse.

Is my Verizon pension protected by the PBGC?

Most single-employer defined benefit pensions are insured by the Pension Benefit Guaranty Corporation (PBGC), a federal agency. If a covered plan terminates without enough money to pay promised benefits, the PBGC pays benefits up to a legal maximum that varies by age. Benefits that have been transferred to an insurance company through a pension risk transfer are no longer PBGC insured and are instead backed by state guaranty associations.

Should I take my Verizon pension as a lump sum or an annuity?

There is no single right answer. The decision depends on your health and life expectancy, your other retirement assets, whether you need to provide for a survivor, and the interest rate environment that sets the lump sum value. Our lump sum versus annuity guide walks through the trade-offs in detail.