Insurance Europe has published its response to a consultation by the European Insurance and Occupational Pensions Authority (EIOPA) on its draft advice to the European Commission on pension tracking services (PTS).
The insurance industry welcomes and supports EIOPA’s recommendations on the development of PTS. Having a PTS in place is consistent with the insurance industry’s longstanding call for enhanced transparency of pension entitlements. Well-designed PTS have proved to be very effective in supporting people’s retirement planning processes and understanding of how pension systems work.
However, the industry is calling on EIOPA to address some issues and concerns before submitting its final advice to the Commission:
- Information provided by PTS should always be consistent with national information disclosures, not only to avoid confusing savers but also to reflect the diversity of existing pension definitions and information requirements.
- A PTS should first and foremost focus on its primary objective: to provide information on pension entitlements. Other aspects — such as financial education, information on options available and/or encouraging users to take additional steps — could eventually be part of a longer-term progressive roll-out strategy if thorough consumer testing and cost-benefit analysis confirms their relevance.
- The standardisation of data for a PTS would be extremely costly in practice. In particular, attempting to harmonise different sources of information for different products in order to find a single aggregate figure would be costly and turn out to be artificial, thereby misleading consumers.
- The insurance industry strongly recommends that PTS are run through public-private partnerships. National experiences of PTS demonstrate the essential role played by the private sector, including insurers, in the establishment and management of such services, beyond the provision of data.