DALLAS (BP)–Trustees of the Annuity Board of the Southern Baptist Convention voted Nov. 4 to grant a permanent 10 percent increase in benefits for most annuitants receiving benefits established for periods of 60 months or longer. The increase is effective Jan. 1, 1998, and will appear in checks or deposits at the end of the month.
O.S. Hawkins, board president, said in a prepared statement, “It is wonderful to give the success of our investments to our dear, retired ministers, institutional and agency employees and their widows. Our prayer is that God will add his blessing to the lives of these people we serve.”
The increase, the seventh in 10 years, and the largest since 1992, will apply to certain annuities funded from defined contribution accumulations coming from the Church Annuity Plan, Convention Annuity Plan and Voluntary Annuity Plan, as well as Plan A retired and deferred benefits. Also receiving the increase will be people eligible for International Mission Board past-service benefits (deferred or in pay status). People still employed, who have deferred Plan A benefits, will receive the increase on Plan A when they annuitize that portion of their retirement program.
This 10 percent increase will not be paid to variable annuities or to death and disability benefits paid as a result of the Church Annuity Plan’s protection section. Protection section benefits are paid from a separate fund. The increase also will not apply to fixed-period benefits of less than five years, or to installment benefits.
Each year, there is a valuation of the fund from which formula benefits (Plan A), International Mission Board past-service benefits (deferred or in pay status) and other fixed annuity benefits are paid. After calculating future obligations and contingency reserves, actuaries determine if a margin exists that is sufficient to fund a meaningful, permanent increase. Based on these calculations, management recommended the increase to trustees, and the trustees enthusiastically granted it.
Terry R. Wade, managing director of the board’s actuarial division, noted the latest increase will raise the “old Plan A” benefit to 269.6 percent of its original formula benefit.
Benefits in 1998 for variable annuities will be determined in a regular, scheduled calculation later this month, and recipients will be notified in January what their new benefit will be at the end of that month. Variable annuity benefits were increased 15.47 percent in 1997
