GERMANY – This year is becoming the year of the Riester, says insurer AMB Generali – though the other private pension, the Rürup-Rente, is not so hot.
“For us, 2005 is already the year of Riester,” said AMB chief executive Walter Thießen. “On the other hand, the new Rürup pension has not resonated well with clients since its launch at the start of the year.”
AMB, a major player in the German pensions market, said it had sold 84,000 new Riester contracts in the first half – a rise of 70% compared with same period in 2004. This pushed the total number of Riester contracts sold up to 870,000, generating €308m in new business.
AMB said the continued strong demand for Riester – a tax-privileged third-pillar pension – was partly due to recent improvements by the government. It was simplified by boosting its portability and streamlining the criteria for tax subsidies.
Named after Professor Bert Rürup, the government’s chief economic adviser, the new pension is targeted at the self-employed and others who are not insured by the state-run pay-as-you-go pensions scheme. Like Riester, it offers tax incentives to encourage retirement saving.
AMB noted that demand for the Rürup pension had suffered both because of great limitations on its transferability and because the tax incentives were not attractive enough.
“In the long term, though, we believe that there is a great market potential for Rürup. Our expectation that, like Riester, future governments will improve it,” a spokesman said.
Separately, AMB said its new Pensionskasse, or traditional pension fund that serves corporate clients, took in €107.8m in the first half, up 130% from the same period a year ago. At last count, AMB’s Pensionskasse had €1.24bn in corporate pension assets.