NETHERLANDS - Dutch corporations will no longer be faced with high redemption fees if they decide to move their pension fund from one insurer to another.
Pieter Omtzigt, a politician for the Dutch Christian Democrats party who pleaded for the change, told IPE the Dutch second chamber has amended the new pensions law in mid-December.
"Every administration agreement - the agreement between the pension fund management and insurers - now has to have an exit clause," said Omtzigt.
If a pension fund decides it wants to transfer to another insurer - perhaps because it dissatisfied with the performance of its current provider - the insurer will now have to permit the fund to do so under "reasonable and fair conditions".
According to Omtzigt , insurers were previously claiming a redemption fee worth 20% of the scheme's actuarial value if the fund decided to transfer to another provider.
But calling the amendment a breakthrough, Omtzigt added: "[The previous situation was] not a fair functioning of the market in the pension sector; people were stuck in their pension arrangement."
According to Omtzigt, this amendment has created the right of collective value transfer of a fund from one insurer to the other.
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