Dutch insurer Scildon is to transfer its €60m pension fund to the consolidation vehicle Centraal Beheer APF.

It plans to continue pensions accrual for its 165 staff in a defined contribution (DC) plan under its own management from 1 October.

The insurer – formerly Legal & General Netherlands – said it would transfer the €60m of pension assets for 440 workers and pensioners to a multi-client compartment of Centraal Beheer’s general pension fund (APF).

Gonny Dunnink, the pensions fund’s chair, explained that the choice for the most risk-averse section had been guided by her scheme’s investment policy. Scildon’s scheme has an 85% allocation to fixed income, while its liabilities are fully hedged against interest rate risk.

Currently, Central Beheer’s “stability compartment” includes 50 employers and 650 participants, with combined pensions assets of €5m.

The section’s investment policy targets fixed income holdings of 75% and an interest rate hedge of 90%.

Dunnink said that potential pension outcomes of Scildon participants would improve as they were joining a scheme with many active participants.

She added that the current funding difference – 112% for the Scildon scheme versus 106% for the APF’s section – would lead to a one-off improvement of pension rights for the Scildon participants.

The chair also said that costs per member, which stood at €339 in 2017, would halve, but noted that the employer would no longer reimburse these expenses.

Until now, Scildon had average salary defined benefit arrangements in place for its staff.

The company said it had opted for a DC scheme for its workers because governance would be less complex, costs would be more manageable, and members would have more choice.