@article {Gannon38, author = {James M. Gannon, Jr.}, title = {Hibernation versus Termination: Evaluating the Choice for a Frozen Pension Plan }, volume = {2015}, number = {1}, pages = {38--47}, year = {2015}, publisher = {Institutional Investor Journals Umbrella}, abstract = {As a frozen corporate defined-benefit pension plan matures, the need for a decision on exit strategy gets closer. One option is plan termination (the purchase of annuities for all participants, which effectively transfers all liabilities to an insurance company). Another strategy is {\textquotedblleft}hibernation,{\textquotedblright} whereby the sponsor continues to manage the plan at a low level of cost and with some uncertainty about future cost. What are the primary considerations for plan sponsors evaluating these two options? This article offers guidelines and a framework for sponsors engaged in the decision-making process{\textemdash}those tasked with choosing between immediate plan termination and plan {\textquotedblleft}hibernation.{\textquotedblright} To help guide sponsors{\textquoteright} analyses and decision-making processes, the author presents two case studies{\textemdash}sample results of stochastic modeling and sensitivity analysis of the variables represented in the stochastic modeling.}, URL = {https://guides.pm-research.com/content/2015/1/38}, eprint = {https://guides.pm-research.com/content/2015/1/38.full.pdf}, journal = {Special Issues} }