Vontobel Wealth Management launches 'PREVOR' – a flexible pension solution for SMEs

News 3/15/2018
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In cooperation with the insurance broker CGA and the pension foundation Liberty, Vontobel has developed an innovative solution for occupational pensions. This new offering is targeted at SME leaders who want to be able to give their managers an alternative to the statutory BVG insurance, coupled with higher retirement benefits. With PREVOR, extra-mandatory employee benefits insurance is separated from the BVG component, providing greater flexibility.

The last few years have been a turbulent period for the Swiss pension system, and pension funds are facing significant challenges. An ever declining pool of assets has to finance an increasing number of pensioners whose retirement period is growing ever longer. Low interest rates have further exacerbated the situation. Innovative solutions are therefore needed to meet the requirements of the insured – especially in the case of small and medium-sized enterprises (SMEs).

Collective foundations generally propose to SMEs that the mandatory and extra-mandatory BVG components should be integrated within a single ‘comprehensive’ pension plan. This rigid model makes it difficult to create needs-oriented pension plans. In addition, it often reduces the pension benefits from extra-mandatory employee benefits insurance since – out of consideration for employees on lower salaries – the savings contributions have been kept at a lower level for all employees. PREVOR allows SME pension plans to be structured more flexibly, thus enabling them to be tailored to the needs of SME managers, for example, or the requirements of specific groups of employees.

With PREVOR, extra-mandatory salaries exceeding CHF 84,600 can be insured. It also provides the option of insuring the BVG coordination deduction amount of CHF 24,675. Thanks to a range of savings plans, employees can define their own personal contribution and thus align their pension budget with both their savings capacity and their personal tax planning. PREVOR allows employees to decide individually how much they want to save for their retirement and to make a higher level of voluntary contributions than in the past. This provides significant tax advantages. SMEs that can offer their employees better terms and conditions in the area of occupational pensions become more attractive as employers. Similar solutions were only available to larger companies in the past.

“Pension plans become really flexible with PREVOR and can thus take account of the different needs and objectives of SME managers. This represents an important step forward in the area of pensions,” explained Frédéric Constantin, pension planning expert at Vontobel Wealth Management. With the insurance broker CGA as an advisor, Liberty as the pension fund and Vontobel as the asset manager – offering its recognized expertise in the provision of asset management for pension funds – the insured can entrust their pension assets to three proven specialists. “Vontobel is a family-owned company and it understands the needs of SMEs, including in the area of pension planning. We are therefore committed to offering our clients solutions for their businesses that create real value,” added Lionel Pilloud, Head of Vontobel Wealth Management in Geneva.

PREVOR will first be launched in the French-speaking region of Switzerland. It is planned that it will be rolled out in the rest of Switzerland in the coming years.

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