Euclid Specialty underwriters enjoyed attending the National Coordinating Committee for Multiemployer Plans (“NCCMP”) Annual Conference. We thought it was the most informative NCCMP conference in recent years. For those of you who could not attend, here are our thoughts on the major topics discussed at the conference.
1. Multiemployer Funding Levels Are Improving. In his annual report, Josh Shapiro, Deputy Executive Director for Research and Education for NCCMP, reported that multiemployer plans are “on the path to recovery.” Although “it will take many years,” they are now in a “positive direction.” He reported that many of their surveyed funds had utilized the 2010 statutory relief tools, including thirty-year amortization, 10-year smoothing of assets, and the 130% corridor. Specifically, in 2011, multiemployers funds in the NCCMP survey were 84% funded on the PPA actuarial value basis and 75% on a market value basis (with no actuarial smoothing). This compares to 2009 survey funding levels of 77% on an actuarial value basis and 65% on a market value basis. In 2011, 59% of the funds were in the green zone, 17% in the yellow zone, and 24% in the red zone; this compares to 2008 survey results of 76% green zone, 15% yellow zone, and 9% red zone.