How do guaranteed insurance accounts serve the needs of the defined contribution plan landscape?

Guaranteed insurance accounts are similar to other stable value investments, such as pooled funds or individually managed funds, in that they deliver principal safety, cash like liquidity for participant driven transactions, and consistent, positive returns that are generally higher than money market funds. Much like pooled or collective stable value funds, guaranteed insurance accounts often cater to the needs of small to mid-size plans that may otherwise be unable to offer stable value as an investment option to their plan participants.

Stable value investments are tailored to meet the needs of a specific plan participant population and/or group of plans and their plan participants. While all stable value investments deliver the same basic benefits, there are differences in structure, levels of guarantees, as well as some contractual features. Having this multitude of structures enables plan fiduciaries to select the stable value investment that is best suited to their specific plan participants’ needs. The chart below provides an overview of stable value products.