If XOM goes belly up, anyone know what happens for folks that chose the annuity for the pension when they retired? I know Northern Trust is involved with it and it has insurance, just not sure at what point it gets covered by the government with limitations that would lower the payments to whatever the govt max is.
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At retirement, if employee elects a pension, Company purchase an annuity from an insurance company who then becomes responsible for payment of annuity to the employee to end of life. ie Company is no longer involved in that employees pension unless the annuity somehow becomes insolvent as EM has remaining accountability for the pension. So an annuitant would need to have two things go wrong before it goes to PBGC for payout (which is dimes on dollars....), the insurance company going belly up and EM similar. The likelihood of a retiree losing his pension is much lower than a retiree losing his lump sum payout. I believe the insurance company managing pensions/annuities is Prudential (The Rock...)
Read the PBGC information carefully and do a little research. If the pension is turned over to them, history shows pensioners can expect to receive dimes on our dollars. And XOM is regularly called out for having one of the more underfunded plans out there.
Before XOM goes belly up (unlikely) or cuts its dividend (possible), they could eliminate the lump sum option to conserve cash. Changes to the Retirement Plan are definitely in the works as poor execution, strategic mistakes and lack of leadership accountability has caught up with the management of this company with the pain unfortunately borne by its employees rather than the management. Heads up all ye who are thinking of retiring next year or later.
All the info you seek right here: https://www.pbgc.gov/