Business: More time for pension funds, private partial disability schemes better option
The Dutch pension regulatory authority (DNB) has announced that reinsured pension schemes that are carrying a shortfall on their liabilities due to a credit risk at their reinsurer have until 1 April 2010 to submit a recovery plan.
According to the DNB around 200 Dutch pension funds have their liabilities partly or fully reinsured.
Pension funds in general have improved considerably in recent months due to a rally in equity prices. In August the all-important "funding ratio" for pension schemes rose to over 105 percent and, according to the DNB, if this performance is sustained for three consecutive quarters schemes will be able to set aside the emergency funding measures established by their individual recovery plans.
Private partial disability schemes better option
Tomorrow (1 November) is the deadline for companies in the Netherlands to decide whether to opt into the state partial disability insurance scheme or switch to a private insurer.
The Dutch government gave companies more time to decide whether to opt into the state partial disability insurance scheme or switch to a private insurer through extending the original 1 October deadline by one month.
Private schemes are currently charging around 0.3 percent of gross remuneration for partial disability insurance, but the state scheme is charging premiums of 0.59 percent of gross pay for small enterprises, with only a slight discount for larger enterprises. All schemes must be fully operational by 1 January 2010.
Copyright: FedEE Services Ltd 2009