Underfunded pension plan

Underfunded pension plan

A pension plan that has a negative surplus (i.e., liabilities exceed assets).

Underfunded Pension Plan

A pension plan that has more liabilities than assets. That is, the retirees covered under the pension plan have been promised more than the plan contains. This may happen for a variety of reasons, such as the pension's investments not going as expected, or perhaps retirees are living longer than expected. It can lead to bankruptcy, though some pension plans have government guarantees.
References in periodicals archive ?
Consequently, an underfunded pension plan was not only permissible, but was the target itself.
United Airlines recently turned its underfunded pension plan over to the Pension Benefit Guaranty Corp.
The brewery said lenders won't finance $4 million in much-needed plant improvements because of the underfunded pension plan.
When the PBGC stepped in to administer the company's underfunded pension plan, Clarke's benefits were slashed by $700.
5 million settlement with about 500 people in its underfunded pension plan, covering less than a third of a shortfall in expected benefits.
It also wants the federal government to allow it to stretch out payments to its underfunded pension plan.
The Teamsters have now started a work stoppage to force the PLCA to accept yet another Teamster underfunded pension plan.
2 million payment to the drivers' underfunded pension plan, in return for the union's agreement to increase its contribution to that plan to match what management already bears.
Like Chrysler, GM has just finished topping up a previously underfunded pension plan, leaving it with more disposable cash than it has had in several years.
The company's new Insured LDI client was managing an underfunded pension plan that, through this new solution, was able to cover its complete range of plan participants, and not just retirees.