PBGC is a federal government corporation that insures most private-sector defined-benefit (traditional) pension plans. When a covered plan fails or is terminated without enough money, PBGC steps in and pays guaranteed retirement benefits, up to legal limits, to the affected workers and retirees. Its insurance programs are funded by premiums paid by the employers who sponsor those plans, plus the assets of plans it takes over, rather than by general tax dollars.
Created by Congress under the Employee Retirement Income Security Act of 1974 (ERISA), Title IV (29 U.S.C. Sec. 1302 (Pub. L. 93-406)), it acts within the authority that statute grants. Its actions are subject to judicial review and to congressional oversight and funding.
