Employees and pensions

Reorientation of occupational benefits insurance

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AXA is moving forward and will be focusing entirely on semi-autonomous solutions in occupational benefits insurance in the future. This enables us to create a sustainable framework that will be more attractive, fairer and more flexible than current full-value insurance solutions.

Full insurance means: minimal interest as the price for high security

Full-value insurance offers high security and covers all risks such as death, disability and even the investment risk. But this comes at a price: Under full-value insurance, the capital has to be covered 100% at all times. This necessitates a very cautious investment strategy, whereby the retirement assets of the insured can only earn minimal interest.

Changes in society demand new solutions

Due to the continuous growth in life expectancy, pensions have to be paid out for longer and longer. For this to remain financially viable in the future, a much higher return is needed than can currently be achieved under full-value insurance. In contrast, semi-autonomous solutions offer greater scope to invest the retirement assets profitably. This is because their investment conditions are less restrictive.

Flexibility pays off

It is therefore the flexibility of semi-autonomous solutions that will enable us to keep pace with rising pension costs in the future. In contrast to full-value insurance, temporary gaps in coverage caused by investment market fluctuations are permissible with a semi-autonomous solution. These can be compensated for by reserves that have been set aside earlier from the comparatively higher profits. Overall, semi-autonomous pension provision is more profitable than full-value insurance thanks to the better interest it can pay on the retirement capital over the medium to long term.

Semi-autonomy as a secure solution

Unlike for full-value insurance, the risks of death and disability are covered in part or in full by reinsurance agreements under semi-autonomous solutions. Moreover, the incongruous redistribution from younger to older insured persons can be reduced. The active insured thereby benefit from higher interest being credited to their personal retirement accounts.

Good starting conditions for a joint future

Anyone already drawing an old-age pension will continue to be insured by AXA on unchanged terms and conditions. This makes it possible to launch the semi-autonomous foundations without current old-age pensions, giving an enormous boost to their structural risk capacity as well as to earnings opportunities for their customers compared with the market. In addition, future retirement and survivors' pensions will be funded using a security-oriented approach.

The responsibility for the investment strategy and investment risk will be transferred from AXA to the foundations. AXA will continue to manage the pension assets. With our many years of experience, we will therefore remain the foundations' tried-and-trusted partner into the future. To ensure the foundations can commence their semi-autonomy with a solid financial reserve, they will receive considerable additional funds.

All things considered, the semi-autonomous pension is a complete and secure solution for the formation of occupational retirement capital. And when it comes to investing the pension assets professionally and accruing sufficient interest, we remain your tried-and-tested, long-term partner. As a recognized and globally renowned asset manager, we offer the best conditions for optimum management of your retirement assets.

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