Late UPOs could trigger AFM sanctions
NETHERLANDS - Pension providers and insurers risk "formal measures" from communications supervisor AFM if they do not send out their 2008 uniform pension statements (UPOs) this year.
Harman Korte, chief supervisor of the behaviour of pension providers, said during an AFM pension congress on Thursday even statements - known as UPOs - sent out in only the last quarter of this year will trigger a letter from the AFM, urging schemes and insurers to do so before 1 April.
According to Korte, the AFM is looking in particular into schemes managed by insurers, as they appear to have had problems with the timely processing data changes and this has resulted in most UPOs being sent out within the last quarter.
The regulator is also looking at multiple UPOs issued by insurers as it may be workers are participating in different pension schemes, Korte announced.
The new Pension Act requires pension funds and insurers to provide "factually correct, timely and accessible information" about their pension plans to all participants as of 1 January 2008.
However, an AFM survey based on self-assessment by providers found one-third of them were not sufficiently prepared for the new information requirements at the end of last year, the supervisor said.
Hans Hoogervorst, chairman of the AFM, recently announced pension providers will be given a three-month respite on the introduction of the indexation label - as part of the UPO - which was initially set at 1 January 2009. (See earlier IPE story: Three months grace on indexation label)
A delay of the label should allow providers to base their first official ‘label' communication on actual continuity analysis and the cover ratio achieved by the end of this year, Hoogervorst explained.
That said, the mandatory ‘start letter' - containing information for new participants of a scheme - must be introduced from 1 January as planned, confirmed Martijn Pols, spokesman of AFM, to IPE.
Korte indicated the AFM is planning to focus next year's supervision on the UPOs, start letters and information on indexation, as well as on costs transparency and providers' duty of care in defined contribution arrangements,.
"We will also look at the information provided as part of a value transfer in the case of a scheme change by participants," he added.