Recently, the China Banking and Insurance Regulatory Commission issued the "Notice on Launching the Pilot Program of Commercial Pension Business of Pension Insurance Companies", deciding to launch the pilot program of commercial pension business of pension insurance companies from January 1, 2023, and the pilot period is tentatively set for one year.
The pilot program will be carried out in 10 provinces including Beijing, Shanghai, Jiangsu, Zhejiang, Fujian, Shandong, Henan, Guangdong, Sichuan and Shaanxi.
Participating in the pilot pension insurance companies are: China People's Pension Insurance Co., Ltd., China Life Pension Insurance Co., Ltd., Taiping Pension Insurance Co., Ltd., and National Pension Insurance Co., Ltd.
Different from personal pension
In recent years, the coverage of old-age security for Chinese residents has continued to increase.
As of the end of 2021, my country's first-pillar basic pension insurance covers a population of 1.029 billion, with a fund balance of 6.4 trillion yuan.
The second pillar of enterprise annuity and occupational annuity covers more than 70 million employees, and the accumulation fund is 4.4 trillion yuan.
In terms of the third pillar, the current rapid increase of insurance products with pension attributes has accumulated more than 5 trillion yuan of pension liability reserves for the people.
Over the past year of the exclusive commercial endowment insurance pilot program, more than 250,000 people have insured, including 47,000 new industries, new types of workers and various flexible employment personnel.
Pension wealth management has issued 49 products with a total scale of 100 billion yuan.
On November 25, the Ministry of Human Resources and Social Security announced that the personal pension system will be implemented in 36 leading cities or regions including Beijing, Shanghai, Guangzhou, Xi'an, and Chengdu.
A total of 7 products from 6 companies were selected in the first batch of personal pension insurance product list, all of which are exclusive commercial pension insurance products.
The person in charge of the relevant department of the China Banking and Insurance Regulatory Commission stated that the commercial pension is positioned as an inclusive and innovative personal commercial pension financial business for the general public. It is an integral part of the third pillar pension insurance and supports and complements the development of the personal pension system. role.
The main differences between the two are as follows: First, personal pension is an endowment insurance system supported by government policies, voluntary participation by individuals, and market-oriented operation to realize the supplementary function of endowment insurance.
Commercial pension is a pension financial business that individuals voluntarily participate in, and operates market-oriented and legalized. Pension insurance companies provide one-stop services including account management, planning consultants, product purchases, and long-term payment.
Second, the state formulates preferential tax policies to encourage qualified personnel to participate in the personal pension system and receive personal pensions in accordance with regulations.
Individuals who participate in the commercial pension business do not enjoy the relevant preferential policies for personal income tax.
Third, workers who participate in the basic endowment insurance for urban employees or the basic endowment insurance for urban and rural residents in China can participate in the personal pension system.
Individuals who have reached the age of 18 can sign commercial pension business-related contracts with pension insurance companies and accumulate long-term pensions through commercial pension accounts.
Fourth, personal pension fund accounts are used to purchase financial products such as bank wealth management, savings deposits, commercial pension insurance, and public funds that meet the regulations.
Commercial pension customers can choose to purchase a variety of commercial pension products provided by pension insurance companies.
Up to now, the China Banking and Insurance Regulatory Commission has successively launched pilot projects such as exclusive commercial pension insurance, pension wealth management products, and specific pension savings, and has achieved positive results.
At the Financial Street Forum held a few days ago, Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, stated that the most important thing to standardize the development of the third pillar of pension insurance is to encourage financial institutions to develop commercial pension financial products that match the name and reality and operate safely.
By optimizing the allocation of large categories of assets, the establishment of income smoothing funds and risk reserve funds provides matching pension financial products for groups with different risk preferences and tolerance.
The endowment insurance funds accumulated by the three pillars should adhere to the concept of "long-term investment for long-term returns, value investment to create value, and prudent investment for reasonable returns", and invest a certain proportion in social undertakings and industries to play a powerful "EMU" effect.
What are the characteristics of commercial pension
Commercial pension is a new type of commercial pension insurance business operated by pension insurance companies. It mainly relies on innovative products and services based on insurance business rules to provide customers with services such as pension account management, pension planning, fund management, and risk management.
According to the person in charge of the relevant department of the China Banking and Insurance Regulatory Commission, the commercial pension business mainly has the following characteristics: First, the combination of accounts and products.
Establish information management accounts for individuals, provide commercial pension products with different characteristics such as maturity, risk, and liquidity, and meet customers' pension needs such as stable investment, risk protection, and retirement benefits.
The second is to establish a dual-account combination of locked-in pension accounts and continuous pension accounts, taking into account the dual needs of locked-in pension funds for long-term investment and individual liquidity at different ages.
The third is that the product design takes the accumulation of pension as the main function, supports individuals to accumulate pension funds continuously for a long time, and can provide certain additional risk protection such as death and accidental injury.
The fourth is to strengthen risk management and control, establish a product custody mechanism, strengthen investment supervision and valuation reconciliation, and control risks through various means.
The fifth is to provide various payment arrangements such as fixed installments, regular installments, and long-term (lifetime) annuity payments.
The sixth is to provide pension planning services including income and expenditure calculation, demand analysis, asset allocation, etc., to assist customers in managing pension risks in the life cycle.
People in the industry generally believe that launching the pilot program of commercial pension business of pension insurance companies to further enrich the supply of commercial pension financial products is also an innovative exploration to implement and coordinate the development of other personal commercial pension financial business requirements, which is conducive to promoting and standardizing the development of the third pillar pension insurance.
Chen Hui, director of the China Actuarial Science and Technology Laboratory of the Central University of Finance and Economics, said in an interview with a reporter from the Economic Daily that commercial pension financial products must not only deal with inflation risks, but also face longevity risks. He hopes that the pilot pension insurance company can give users more choices The right to truly realize the maintenance and appreciation of pension funds.
Pension insurance companies are actively preparing
Pension insurance company is the only professional insurance institution in my country's financial market with the word "pension" in its name. It has many years of experience in customer service and pension investment management in the development of pension finance.
A total of 4 pension insurance companies were selected for this pilot, including companies that have been established for many years and new forces.
Mo Yang, the person in charge of product publicity of the National Pension Insurance Company, said that the National Pension Insurance will adhere to professional focus, meticulous planning, and orderly launch of pilot work.
The company has made full preparations in terms of products, systems, investment, operations, customer service, personnel and system preparation, etc., and will file commercial pension products as soon as possible. Bank communication business sales cooperation, continue to meet the diversified and multi-level elderly care needs of the people, and provide customers with long-term and stable fund management and risk protection services.
In addition, the National Pension Insurance has also developed the "National Pension Planning" WeChat mini-program, relying on industry big data to support individuals and families to carry out calculations of basic pensions and occupational pensions after retirement with one click.
The mini program will develop smart trial calculation tools for national pension insurance products including commercial pensions, and support customers to independently and flexibly plan product payment and collection plans, and easily complete their own pension planning.
Pension insurance companies are major participants in my country's enterprise (occupational) annuity fund management market. They have long carried out entrusted management and investment management of enterprise (occupational) annuity funds, and actively participated in the investment management of basic endowment insurance funds. Played an important role in the construction of the two pillars.
The reporter learned from China Life Pension Insurance Company that the company has been deeply involved in the field of pension finance since its establishment 15 years ago. "Three pillars", serving more than 30,000 corporate customers and more than 30 million individual customers, and providing occupational annuity trusteeship and investment management services for 33 occupational annuity coordination areas that have been put into operation.
The relevant person in charge of China Life Pension Insurance Company stated that the company has concentrated its superior resources to promote product development and other related work. To meet the diverse needs of residents of different ages, occupations, and risk preferences, realize the life cycle management of pension funds covering retirement.
The person in charge of the relevant department of the China Banking and Insurance Regulatory Commission stated that the four pension insurance companies participating in the pilot program have their own characteristics in terms of capital strength, business channels, and management. Expertise in risk management and other aspects, as well as the rich experience accumulated in long-term participation in the development of my country's multi-level and multi-pillar pension insurance system, will further deepen the supply-side structural reform of pension finance, better meet the diverse needs of the people for pension security, and explore ways to adapt to my country's pension insurance system. The development path of pension finance in China.
Yu Yong Yang Ran (Source: Economic Daily)