A standard practice?

Cutting Edge: Solvency risk

Introduction

Measurement and management of the solvency of the pension plan is one of the key responsibilities of the trustees of a plan. If the sponsor does not underwrite the liabilities of the fund (as is the case in the Netherlands), solvency of the fund itself will be a major concern for the regulator as well as for the participants in the plan, unless continuity of the fund is assured and all risks can be shifted to future generations. If the sponsor is liable for deficits in the pension fu