Deposit Administration Plan
Definition of "Deposit administration plan"
Unallocated funding instrument for pension plans under which premiums are placed on deposit, and are not currently allocated to the purchase of benefits for the employee. At retirement, an immediate retirement annuity is purchased for the employee. The amount of monthly income depends on the investment results of the funds left on deposit. Many insurance companies guarantee a minimum rate of return on funds left on deposit.
Popular Insurance Terms
Insurance in which most of the premium (generally 80 to 90%) is invested in traditional fixed income securities. The remainder of the premium is invested in call option contracts tied to a ...
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