Data & Research February 25, 2025

Public Pension Plans Reach 5-Year High of 83.1% Funded

The funds returned 9.47% in fiscal 2024, according to a National Conference of Public Employees Retirement System study.
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Public pension funds’ funded status has risen to a five-year high amid equity market strength, according to a study from the National Conference of Public Employees Retirement Systems.

The annual NCPERS retirement study, which the organization has conducted since 2011, found that the average public pension has seen its funded status reach 83.1% through the first half of 2024, typically when the fiscal years for these plans ended.

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The report also found that discount rates have decreased to an average of 6.67% in the first half of 2024 from 7.31% in the first half of 2021. Over the past five, 10 and 20 years, these funds reported annualized returns of 7.15%, 6.24% and 6.88%, respectively.

“This robust dataset tells a clear story of resilience and strength,” wrote Hank Kim, executive director and counsel at NCPERS, in the report. “In the span of 20 years, public pensions have endured two major economic crises. Yet with strong governance policies and efficient practices in place, pensions have shored up funding levels and improved their long-term fiscal health.”

The plans surveyed by NCPERS, on average, have a 41.5% allocation to equities, 29.7% to alternative investments, 26.1% to fixed income and 2.7% to cash equivalents and other.

Approximately 67% of plan assets under management by survey participants are managed externally. Another 23% said they partially manage their assets in-house. Only 4% of respondents said they managed all assets in house, and another 5% said they took other approaches.

Looking ahead, the report found that some of the biggest priorities in 2025 for these pension funds include improving their cybersecurity, sustaining their pension funding levels, updating their pension administration systems and determining the role of artificial intelligence in pension management.

NCPERS surveyed 201 public pension funds between September 19 and November 14, 2024. Survey respondents collectively manage $3 trillion in assets. Approximately 89% of respondents were defined benefit plans, 10% were combined defined benefit/defined contribution plans, 7% were defined contribution plans and 1% were cash balance plans.

Compliance February 24, 2025

Call Center Rep Accessed Data of More Than 2,000 Customers at Inspira Financial

The third-party call center representative improperly accessed personal data of retirement plan participants between December 2024 and January 2025.

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Inspira Financial Trust LLC—a provider of health, wealth, retirement and benefits solutions—on February 20 notified at least 2,308 retirement plan participants of a data breach, according to an alert on the Maine attorney general’s website. 

A third-party call center representative improperly accessed data relating to a “limited number of retirement accounts” operated by Inspira, according to the letter the company sent to affected participants.

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In January, according to the letter, Inspira—renamed from Millennium Trust Co. in January 2024—learned that the breach occurred between December 2024 and January 2025. The personal information accessed may have included participants’ names, Social Security numbers, dates of birth, mailing addresses, previous employers, previous retirement plan sponsors, and Inspira account numbers, types and balances.

After learning of the issue, Inspira took steps to determine the nature and scope of the breach, the letter stated. The call center representative at issue is no longer an Inspira contractor, and the company is working with the call center vendor to ensure the breach has been reported to law enforcement authorities.

Inspira also flagged affected participants’ accounts for enhanced security review before any transactions can take place as an additional security measure. The hold is in place until participants verify their identity and direct Inspira to remove the flag.

Inspira is offering identity protection and credit monitoring services through Experian for two years at no cost to affected participants.

Inspira serves 8 million customers and institutional clients, and it custodies $63.1 billion in assets for them. Inspira did not immediately respond to a request for comment on the incident.

This breach comes just one week after The Pension Specialists Ltd., an independent retirement plan third-party administrator, disclosed a 2024 data breach in which more than 71,000 people had their personal information exposed. That incident was described as an external system breach or hacking.

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