Dissecting Impacts Of Pension Enhancement On Retirees Business
Programmed withdrawal is a method by which the retiree collects his retirement benefits in monthly or quarterly amounts throughout the length of an estimated lifespan, which is determined using mortality tables. This is a product offered by Pension Fund Administrators .
Enhanced Pension PenCom’s framework on Enhanced Pension and the Addendum dated 3rd October 2018 state that “PFAs shall continue paying current pensions to PW retirees that have insufficient growth [in their RSAs] to be considered for enhancement [and also those] that have fully exhausted their RSAs from the provisions made for Pension Protection Levy pending implementation of Minimum Guaranteed Pension ”, in pursuant to sections 82 and...
Similarly, the chairman/CEO Achor Actuarial Services Limited, Dr Pius Apere, said, the enhancement of pension for PW retirees only could be seen as cushioning the effect of the non-implementation of Guaranteed Minimum Pension but this is not a substitute for GMP. Saying, it has become expedient and imperative for the Life Annuity regulator, operating under the current Enhanced Pension regime in the Pension Industry, to also consider ways of redesigning the LA product to allow for distribution of profits from the LA pools of a particular LA Insurer, he added that, this will help the LA insurers to remain competitive in the pension business over the long term, which is currently being controlled by the PFAs and at the same time, to an extent, cushioning...
Stating that pension enhancement is not necessarily synonymous with pension review as provided for in the Constitution, he noted that, the enhancement, being carried out by PenCom, is principally based on pension fund investment performance.According to Apere, the regular enhancement of Pension for only PW retirees would no doubt cushion the effect of inflation on their pensions over time, thereby, creating unique selling proposition for PFAs that could be used to de-market the LA Insurers.
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