Retirement annuity is a financial product offered by insurance companies, which after having received people’s pension savings start paying a monthly payment amount that can be called a lifetime pension. It is paid unto depositor’s death.
According to International News Agency Kazinform, the National Bank of the Republic of Kazakhstan offers to guarantee payment on retirement and insurance annuities. This was stated by the Deputy Chairman of the National Bank of Kazakhstan Zhanat Kurmanov at the joint meeting of the Finance and Budget Committee and the party "Nur Otan".
This measure, according to the representative of the regulator, can be implemented, with due consideration of international practice. Additional guarantees are provided for in the draft law.
"With a funded pension, we have the state guarantee for safety at the inflation level; bank deposits have a guarantee system, the Deposit Guarantee Fund. But there is no guarantee for retirement annuities and annuities for compulsory accident insurance of workers. There is no way to provide a full guarantee. It is impossible to intentionally change the demands that we make on insurance company. But when transferring an insurance portfolio from one insurance company to another, there are cases that a person turns out to be not protected”, Kurmanov said.
Insurance Payment Guarantee Fund can take on the role of a guarantee agent.
Different players of the insurance market have a different vision about the need to introduce one more guarantee mechanism in the life insurance market.
Insurers have view points on this matter.
The first is pro retirement annuity guarantee in the event of bankruptcy of the company.
Through the mechanism of government: through a general insurance payment guarantee fund or by forming a separate guarantee fund for life insurance companies.
The National Bank proposes to combine the guarantee in one fund, but with separate accounting.
Some life insurance companies believe that the retirement annuity is a voluntary type of insurance; a person makes a decision about the transfer of his savings in a private insurance company. Thus, being a voluntary type the retirement annuities should not be guaranteed.
In that case, a rhetorical question arises: should the state or the fund guarantee all agreements on voluntary insurance.
Photo per website: http://nenovost.com