Compensate occasionally greedy, grasping old man (5)
I believe the answer is:
repay
'compensate' is the definition.
(thesaurus)
'occasionally greedy grasping old man' is the wordplay.
'occasionally' means one should take alternating letters.
'grasping' indicates putting letters inside.
'old man' becomes 'pa' (both can mean father).
The alternate letters of 'greedy' are 'rey'.
'rey' placed around 'pa' is 'REPAY'.
(Other definitions for repay that I've seen before include "Do or give in return" , "Refund or reward" , "recompense" , "Requite" , "Quite old" .)