The new Pension Protection Act of 2006 will require defined benefit and defined contribution retirement plan sponsors to send more information to participants.

Analysts at Milliman Inc., Seattle, have described the new retirement plan disclosure and notice requirements in a summary of the PPA.

President Bush signed H.R. 4, the bill that created the PPA, Thursday.

PPA provisions that will revamp defined benefit plan funding rules, encourage investment advisors to offer 401(k) plan investment advice and establish federal marketing standards for corporate-owned life insurance have been getting most of the attention.

But the Milliman analysts note that the new PPA disclosure and notice requirements will require employers to give participants more information and to provide that information more quickly.

The U.S. Department of Labor is supposed to publish model notices and instructions for complying with the new rules in about a year, the analysts write.

Under the PPA, employers will have to provide:

- More detailed information about defined benefit plans, such as explanations of plan assumptions, in Form 5500 annual reports.

- Benefits statements at least every 3 years for vested participants in defined benefit plans.

- Annual notices for members of defined benefit pension plans describing the plans’ assets, liabilities and funded ratios.

- Quarterly performance statements for members of 401(k) plans that include the total benefits the participant has accrued and other information, such as the value of assets held in each investment and an explanation of any restrictions on the right to direct an investment.

“For a plan that does not give participants the right to direct their investments, the PPA generally requires annual benefits statements,” the Milliman analysts conclude.