GERMANY – Deutsche Herold Leben has outlined its plans to target Germany’s private and occupational pensions market as outlined under the recent Riester law proposals, saying that it could have a new dedicated institutional company up and running within three months.

The company has already launched a range of retail funds under the Riester legislation, but notes that it will need to create a separate unit from the life insurer under the law to target the occupational arena.
Jürgen Weiler, head of the product development department at Deutsche Herold, comments: “This company could have contracts with life insurers and be administrator or adviser.
“ It would be more dealing with arranging the products and then possibly using Deutsche Asset Management and other parts of the group for the investment etc.
“ It’s still under discussion because it is not very clear how the directive will work in the small print of the law.
“ It could be the idea that we use the spezialfonds offered by Deutsche Asset Management.”

Weiler believes it is essential, however, that the government takes on board proposals by industry associations in Germany for investment rules under the Riester pensions law to differ from life insurance to get different risk/return profiles.
“ We need to take a little more risk, giving more chance to have good returns.”

He notes that the Deutsche Herold retail product comes near to what the company would like to offer for pension funds, but adds: “To have this pension product for occupational pension schemes in a new company is not so easy. We might have to wait two or three months because it differs from the retail side.”