Occupational pension procurement of ITP completed

 13 life Swedish life insurance companies participated in the procurement of the new five-year agreement within the ITP agreement - today we found out which ten companies were selected.

We congratulate our customers AMF, Folksam and Skandia, who became eligible for traditional insurance, as well as Swedbank, SPP and Movestic, which became eligible for unit-linked insurance. Again, Itello shows that our solution for efficient administration of contractual pensions through selection centres is competitive in both forms of traditional insurance and unit-linked insurance.

The procurement of a new ITP plan purpose is to provide 1.8 million white-collar workers with an as high pension as possible, and in the tender base, high demands are placed on high historical returns and low fees. . 

The new agreements will enter into force on October 1st, 2018 and last for five years. Within ITP, the pension premiums from over 35 000 employees are paid and placed monthly through the service center Collectum. 

Procurement drives prices down

Since 2007, when the first procurement within the contractual pension area for privately-employed white collar employees - ITP came into force, the contracting parties have succeeded in pushing the prices. The new fees apply for five years until 2023.

In 2013, the requirement for historical returns and mix between different stock markets and interest-bearing securities was introduced in the so-called entrance solutions. Investigations had shown that many remained in the fund choice one made initially regardless of how the distribution of capital changed, which also made the distribution of premium contributions.

The procurement put these demands and also really low fees. Some raised a warning finger so that the actors "doped" their entrance fund solutions in order to be eligible and then had "sales campaigns" where the purpose was to get customers to switch to other and more expensive funds.

Although prices have been squeezed and thus revenues, the Swedish occupational pension market has increased almost 11 per cent a year since 2007. The increase compensates somewhat for the cost pressures that have been, but above all the occupational pension area has grown considerably more than Sweden's economy measured in GDP - 4.5 per cent for corresponding period.

It should be added that it is, to a large extent, wage developments, shifts from low-paid to high-paid and larger pension provisions that caused the increase in paid-in premiums. 

Inca - provides flexible target-date funds solutions and cost-effective administration

Swedbank, SPP and Movestic will be able to offer a superior solution for their mutual funds in the form of generation portfolios in Inca.

Our solution for generation portfolios gives our customers the opportunity to let the savings in target-date funds following predetermined glide paths, allocating the between equity and fixed interest assets. They can also offer functionality to automatically rebalance customer ITP savings by using the automated and cost-effective rebalancing process in Inca.

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Read more about our Co-Operation and Governance Model with customers

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  • March 9, 2018