| no background 1 |
no background 2 |
Pacific Insured LDI |
Pacific Secured Buy-In |
Pacific Trasferred Buy-Out |
|---|
| |
Liability settled with insurer |
|
|
✔ |
| Contract held as asset in trust |
✔ |
✔ |
|
| Insurer bears demographic gain/loss experience relative to assumption (e.g. mortality) |
|
✔ |
✔ |
| Does not trigger settlement accounting |
✔ |
✔ |
|
| Insurance Premium Calculation |
Underwritten at individual participant level |
|
✔ |
✔ |
| Uses insurer's assumptions and discount curve |
|
✔ |
✔ |
| Uses plan-provided cash flows and discount curve |
✔ |
|
|
| Interest rate locked in at contract initiation (true for Insured LDI if contract not revoked/amended) |
|
✔ |
✔ |
| Insurance Fees |
One-time lump sum |
|
✔ |
✔ |
| Annual basis point fee |
✔ |
|
|
| Cash Flows |
Payments directly to plan participants from insurer |
|
|
✔ |
| Payments to plan trust |
✔ |
✔ |
|
| Contract Liquidity |
Revocable at contract value without financial penalties (only Insured LDI allows discretionary revocation) |
✔ |
✔ |
|
