SWEDEN - Länsförsäkringar, one of the eight insurance companies selected to manage Sweden's new white collar pension scheme ITP, has added a new hedge fund to its offering.
Under the new DC arrangements, which became active on 1 July, 35,000 people are eligible to invest 50% of their employer's contributions in funds of their choice.
The remaining 50% will be placed in traditional pension insurance products.
Länsförsäkringar has added Catella Europe Hedge, a long-short equity hedge fund launched by Swedish asset manager Catella Kapitalförvaltning at the end of May, to its fund offering, bringing the total number of hedge funds available to ITP members to five.
Länsförsäkringar offers three hedge funds - Banco Hedge, Catella Europe Hedge and Lannebo Alpha - Moderna Försäkringar offers two - Aktie-Ansvar Graal and Lannebo Alpha - and SEB offers one - Global Hedge Lux ack.
ITP members can choose from a total of 179 funds spread across a range of asset classes.
If they fail to make an active choice, their contributions will be placed in a traditional pension insurance product with a pre-selected company.
The eight insurance companies awarded contracts by Collectum, the company responsible for administering the ITP scheme, were AMF Pension, Länsförsäkringar, Nordea Liv & Pension, Skandia Liv, Moderna Försäkringar, SEB Trygg Liv and Swedbank Försäkring.
AMF and Länsförsäkringar provide both traditional and fund-based insurance.
Lennart Johansson, assistant to the CEO at Collectum, who was involved with the procurement of the managers, said Collectum would be the point of contact for members in the scheme.
"That means Collectum is the administrator and will inform the scheme members on a neutral, objective basis," he said.
"Besides that fund insurers and others are free to do their marketing activities and discuss their funds with individuals who visit the banks and insurers' offices."
Johansson said the company would carry out various surveys to touch base with the market and try to understand how well scheme members perceived ITP.
From August, an estimated 2,000 members each month will be eligible to choose to invest in the ITP managers' funds.
The DC scheme applies to white-collar employees born after 1978, and is expected to generate flows of SEK20-25bn (€2.1-2.7bn) when fully functional.
It was switched from DB to DC this year after protracted negotiations between the Swedish Enterprise Confederation, Svenskt Naringsliv, and the trade union, the Federation of Salaried Employees (PTK).