Groupe expects changes to assumptions under IORP

The Groupe, which represents European Union actuarial associations, has issued a 26-page study called ‘Minimum Technical Provisions for Defined Benefit Occupational Pensions in the EU, A summary of minimum funding requirements'. It's edited by Chinu Patel of Watson Wyatt.

The survey highlights certain types of schemes where it is not clear if and how Article 15 of the Institutions for Occupational Retirement Provision directive will apply. 

"For example, in many countries where insurance is a common method for financing pensions, the sponsoring employer usually carries certain residual risks (for example, the risk of salary increases and some biometric risks)," the Groupe says. 

"We found no evidence of any country that requires the sponsoring employer to pre-fund for some or all of these residual risks and therefore it is arguable whether they are exempt from Article 15.

"We expect to see significant changes in the way discount rates and other assumptions are determined as EU states begin to implement the IORP Directive.

Whilst comprehensive information is not yet available on the way in which each country proposes to implement Article 15 of the Directive, there are signs that minimum technical provisions will in future be characterised by differing balances in member states between scheme collateral, regulatory powers and disclosure." Future surveys will monitor these changes.

A longer version of this article will be published in the January edition of IPE magazine.

The full text of the Groupe's study can be found on

Have your say

You must sign in to make a comment


Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2180

    Asset class: Multi Asset (With any combination of equities, debt instruments and cash / money markets as core assets in the portfolio).
    Asset region: Global (preferred OECD).
    Size: €20M to €40M.
    Closing date: 2016-05-27.

  • QN-2182

    Asset class: Equities.
    Asset region: Europe and USA.
    Size: EUR 500m.
    Closing date: 2016-05-13.

  • QN-2185

    Asset class: Corporate Bonds.
    Asset region: CHF Bonds.
    Size: CHF 40m.
    Closing date: 2016-05-13.

Begin Your Search Here