Overfunded pension plan

(redirected from Overfunded Pension Plans)

Overfunded pension plan

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

Overfunded Pension Plan

A pension that has more assets than liabilities. That is, pensioners' contributions and the investment of those contributions amount to more than what the pension owes to retirees. This is considered a sign of financial health for the pension.
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References in periodicals archive ?
L., 1987, The Effect of Voluntary Termination of Overfunded Pension Plans on Shareholder Wealth, Journal of Risk and Insurance, 54: 131-156.
(GE) could have major implications for government contractors with overfunded pension plans. The COFC ruling on cross motions for partial summary judgment by GE and the government resolves one of the issues being pursued in the case namely that the pension surplus attributable to inactive participants is taken into account when determining the adjustment to previously determined pension costs under CAS 413-50(c)(12).
* The Effect of Voluntary Terminations of Overfunded Pension Plans on Shareholder Wealth," by Jack VanDerhei.
As long as the pension fund assets are expected to grow at least as rapidly as the pension obligation, overfunded pension plans will continue to generate negative pension expense for a long time.
SWAIM: Some transfer provisions allow employers to fund health-care benefits for significantly overfunded pension plans.
Many employers with declining cash flows eye overfunded pension plans as a lifeline.
In a discussion of policy on reversions of excess assets from overfunded pension plans, the authors again argue that policy changes will cause defined benefit plan decline.
Many businesses have off-balance sheet" assets, such as copyrights, leasehold interest rights, and overfunded pension plans. These assets should be examined carefully.
Combined with the strong stock and bond market, this reduced or eliminated deductible contributions for many overfunded pension plans for several years.
VanDerhei, J., 1987, The Effect of Voluntary Terminations of Overfunded Pension Plans on Shareholder Wealth, Journal of Risk and Insurance, 56: 131-156.
This new law may have immediate cash flow benefits for employers with overfunded pension plans, since companies would use excess pension assets instead of current operating funds to pay for current retiree health costs.
This twelve percent increase in the probability suggests that the estimated asymmetry between unfunded pension liabilities and excess pension assets has economic significance to firms with significantly underfunded and overfunded pension plans.