Almost 68% of the voluntary pension funds’(pillar III) participants enjoy this benefit as part of the salary package, as their employer makes the contributions on their befalf, according to an analysis of www.privatepensions.ro, based on data from the pension companies. The information was valid at the end of March 2008, thus being the most recent data available on the market.
Therefore, in 68% of the cases, the employer pays the contribution to the voluntary pension of the respective employee, regardless whether the employee contributes or not. This is the market’s "corporate" segment. On the other side, we have the participants paying the contribution to the voluntary pension themselves, without benefiting from the employer’s contribution. 32% of the participants to the voluntary pension funds were in this situation at the end of March, and they represent the market’s "retail" segment.
In other words, the structure of the voluntary private pension market at the end of March was 68% corporate and 32% retail. This year, the share of corporate sales will continue its ascending trend, to the detriment of individual contracts, retail, according to the companies administrating voluntary pension funds.
At the end of March, the market’s seven funds included approximately 80,000 participants with at least one contribution transferred. Among them, 55,000 had their contribution paid by the employer (of had mixed employer-employee contributions), and the remaining 26,000 paid their contribution themselves, without the employer’s contribution.
The fund with the largest share of corporate sales on the market is BCR Prudent, managed by BCR Life Insurance - in this fund, 90% of the participants benefit from the employer’s contribution. Another fund on this market - Pensia mea, managed by AVIVA Life Insurance - has a higher share of corporate sales - 68%, equal to the overall market’s share.
As for the other funds, they are below the market’s average on the corporate segment. For the two funds administered by ALLIANZ-TIRIAC Private Pensions, the corporate share in the client portfolio is 62%, and in the two funds of ING Life Insurance, the corporate share is 58%. In this respect, the OTP Strateg fund, administered by OTP Garancia, had the lowest percentage - only 42% corporate, as they sold mainly on the retail segment.
Corporate sales are, in fact, the main stake for the administrators of voluntary pension funds this year. Partnerships with employers can bring “packages” of tens, hundreds or even thousands of clients at the same time, thus being more advantageous, easy to make and even “cheaper” for the pension companies than paying sales commissions to agents that manage to get one client sign a voluntary pension contract.
