Zwitserleven’s recently launched Fair Value pension plan offers several features that are unique in the Dutch pensions market. The product is targeted at clients using a separate account, and gives clients a say in how assets are managed. Premiums are based on the ECB* interest curve.
Fair value premium
The premium interest rate for the Fair Value pension plan is fixed at the beginning of each month. This is unique in the Dutch market, where premiums are mostly calculated on a yearly basis or even for a contractual period of five years. Zwitserleven’s method calculates a fixed interest premium that is corrected with a factor based on the interest rate of the given month.

The Zwitserleven separate account can be formed to a great extent in accordance with the wishes of the client. This is due to the modular construction of the premium, and the fact that the client has a say in asset management (within the boundaries of a buffer requirement set by Zwitserleven).

The premium consists of the following elements:
• Fair value premium
• Buffer premium that depends on investment and longevity risks
• Extra premium that relates to the indexation ambitions of the client

The new product is also unique in that the cover ratio in the pension scheme is monitored on a daily basis. In case of a dangerously low cover ratio, the client is warned to adjust the asset mix, change the duration of bonds, or take other measures. In case of a very healthy cover ratio, the client can take a profit, strengthen the indexation reserve, or change the risk profile in the asset mix.

Zwitserleven is convinced that this state-of-the-art new product will help it become even more successful in the corporate client market in the Netherlands.

*European Central Bank

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