NETHERLANDS - Insurer Aegon is planning to launch its defined contribution cross-border pension vehicle Premium Pension Institution (PPI) during the fourth quarter of 2011.
The company will offer clients in-house insurance and administration services, as well asset management via external funds, according to Eric Baltus, manager of corporate and institutional clients sales and defined contribution.
Speaking at the Pension Forum in Rotterdam, Baltus said Aegon's PPI would focus on small businesses - offering a low cost and standard scheme - and on large companies, multinational companies and pension funds, with tailor-made solutions.
However, he declined to elaborate on specific target groups.
Baltus said Aegon's PPI would include the option of guarantees and insurance cover. It will also provide online services for both employers and employees.
Baltus said the Dutch pension sector needed to speed up its entry into the European pensions market, where several cross-border vehicles are already operating under Irish (DC Master Trust), Belgian (OFP) and Luxembourg (SEPCAV) law.
So far, the €150bn Dutch asset manager Robeco and pension provider BeFrank - a joint venture between BinckBank and insurer Delta Lloyd - have received PPI licences from supervisor De Nederlandsche Bank. Five applications are still pending.
Baltus said he expected as many as 20 Dutch insurers, banks and asset managers would eventually offer PPIs of their own.
However, he noted that several potential clients had been slow to embrace the PPI due to its novelty and the inherent complications of cross-border activity.
Baltus said a "smart DC" would be a good export product for the Dutch pensions sector, "as providers can benefit from the experience gained from the current gradual shift from DB to DC arrangements in the Netherlands".
Within this context, he advocated co-operation between providers rather than competition.
Pieter Kiveron, director at Holland Financial Centre, stressed that the Dutch pensions sector needed to focus on customer-orientated services for its foreign business, rather than touting the typical Dutch pensions solutions of its three-pillar system.
He suggested offering quality components, such as pensions and risk management, as well as administration and communication.
"We also urgently need the new pension vehicle API to be completed as soon as possible to start offering cross-border DB schemes," Kiveron added.
In the opinion of Jacqueline Lommen, senior international pensions consultant at Robeco, there are many business opportunities for Dutch cross-border schemes, "as multinational companies that are headquartered in the Netherlands prefer operating such pension arrangements from the same location".