Company retirement pension - advantages for employers and employees

The statutory retirement pension is becoming insufficient to finance an adequate retirement. The company retirement pension is a long-established tool for covering the personal pension gap. Employers have access to five implementation methods. With continuing low interest rates, HDI is concentrating its range of classic employee/workforce pension products on product solutions, which prove to be profitable for the insured persons. At the same time employers and employees can rely on extensive technical advice.


Scope of services at a glance

Company retirement pension (CRP)

HDI offers its proven implementation methods (direct insurance and support fund) to help establish a company pension scheme. Our CRP experts provide support to management boards and workforces covering all issues regarding use, implementation, structuring and the selected pension solutions.

As the policyholder, the employer takes out pension insurance on the life of an employee (insured person). The employees or his/her eligible survivors are entitled to benefit. Companies benefit, inter alia, by not incurring any balance sheet risks and the employees are not required to pay any taxes or social security contributions on the premiums. HDI offers a choice between ‘TwoTrust Selekt’,’ TwoTrust Vario’ and ‘TwoTrust Kompakt’, the successor tariffs to the previous company/active pension. The product solutions differ above all in the scope of the guarantees provided and forms of capital investment. Companies can also offer their employees income protection as a financial benefit as part of a CRP scheme, in case they later become occupationally incapacitated or occupationally disabled. To insure employees against such eventualities, occupational incapacity/occupational disability insurance, ‘EGO Top’ and ‘EGO Basic’, which meet the respective requirements with different hedging levels/benefit levels, can be taken out.

The HDI support fund is an autonomous pension institution, which provides company retirement pensions on behalf of an employer. This can be financed via a remuneration waiver or employer expenditure. The employee receives a pension commitment, which is congruently reinsured by a life insurance policy. A particular advantage is that support fund expenditure is balance-sheet-neutral for the company and tax-exempt for the employee up to a virtually unlimited amount.

The pension fund, in a capital market form, is used as an instrument for balance-sheet outsourcing of existing pension obligations. HDI offers two models – ‘TopPension’ and ‘TeamPension’ - that are not only suitable for the outsourcing of individual commitments, but also for the repayment of pension obligations of entire workforces. The solutions offer an extremely large amount of latitude and flexibility, ranging from a high degree of latitude in setting calculatory interest rates via various financing options through to contributing existing assets to the financing concept.


Highlights

Capital-market-efficient CRP solutions

The Board of Directors and the workforce get access to capital-market-efficient benefit solutions with government funding within the CRP at times of prolonged low interest rates.

Make provisions according to plan and take advantage of cost advantages

By making use of a CRP scheme, employers achieve cost advantages and are provided with operationally appropriate solutions, for which scheduled financing is guaranteed.

Competent advice and introduction

Companies and workforces receive professional and solution-focused advice. HDI experts actively support the operational introduction of pension solutions.

Retaining employees and improving image

Launching a CRP scheme enables companies to boost employee motivation and retention as well as improve their image when competing to recruit and retain professionals and executives.


Experts’ tip

Pension obligations with low interest rates

Prolonged low interest rates are leading to a significant rise in pension commitments in many companies. This worsens the equity ratio and the balance-sheet result. HDI is developing appropriate solutions to reorganise the sustainable financing of pension commitments. This enables us to achieve more flexibility and relief for your company.

Why not speak with our experts.