AXA Collective Foundations continue to be successful

AXA Switzerland can look back on another successful business year in occupational pension provision, according to its latest operating statement: the number of affiliated clients in the semi-autonomous collective foundations rose again last year by 5.5 percent, while the number of actively insured persons increased by as much as 11.1 percent to over 331,000. The sustainable growth course of AXA's collective foundations is thus continuing, the insurance company writes. If the autonomous pension fund business is included, the number of actively insured persons at AXA is over 400,000. Thomas Gerber, Head of Pensions, accordingly states: "AXA's semi-autonomous BVG solutions continue to meet with high demand in the market and support the healthy growth of the collective foundations. In 2022, we achieved the second-best result in our history in new business and thus an excellent result for the third time in a row. The semi-autonomous model is convincing even in economically challenging times and is also fairer and more attractive for policyholders in the face of rising interest rates."

2 billion francs more interest for the benefit of insured persons

Over the past 4 years (2019 - 2022), the retirement assets of insured persons have received an average interest rate of between 2.04 and 2.69 percent in the mandatory system and between 2.68 and 4.6 percent in the supplementary system, depending on the foundation, i.e. well above the BVG minimum interest rate of 1 percent. Since the switch to partial autonomy at the beginning of 2019, the insured persons of the collective foundations have thus received a total of more than CHF 2 billion more in interest credits than would have been possible in the tight corset of full insurance.

Jürgen Scharfetter, Head of Occupational Pension Plans: "Thanks to the higher interest rate, insured persons have significantly better long-term prospects of having a sufficient pension to continue their accustomed standard of living in old age. In addition, with our flexible pension plans, we offer Swiss SMEs and their employees the opportunity to adapt their occupational pension plans to today's employment and life models, such as part-time work. Added to this are differentiating supplementary services that go far beyond pure pension provision and create real added value."

A wide range of additional services for SMEs and their employees

One additional service, for example, is the fringe benefits platform "Swibeco", which also enables micro-enterprises to offer their employees attractive fringe benefits that are otherwise only available to large companies. More than 6,000 companies now use the benefits platform, which means the number has doubled within a year. AXA offers further additional services with "WeCare", which provides SMEs with a comprehensive range of services to promote employee health, from company health advice and preventive measures to the reintegration of sick employees back into working life by means of care and case management solutions.

Very well positioned both financially and structurally

AXA's semi-autonomous collective foundations are very well positioned, the insurance company continues. They have a healthy age structure, a high proportion of non-compulsory pension assets and low pension liabilities compared with the market, it says.

And further: In its asset management, AXA pursues a risk-conscious investment approach and consistently relies on an independent best-in-class principle in order to achieve the best possible long-term earnings opportunities for policyholders. Assets under management for third-party clients increased by 7 percent last year to 41 billion Swiss francs, AXA said. Daniel Gussmann, Chief Investment Officer, says: "As AXA's collective foundations are very well positioned, both financially and structurally, they can cope well even with challenging stock market years. In occupational pensions, people save for decades, and the investment strategies are also geared to this. The portfolios are also broadly diversified, which contributes to stability."

Solid operating result in 2022 in BVG business

Since 2019, AXA has been focusing entirely on semi-autonomous solutions. In the meantime, the vast majority of people insured with AXA are in the semi-autonomous model. Premium income increased by 4.8 percent to CHF 738 million (2021: CHF 704 million) as a result of new business. Investment income decreased from CHF 519 million in the previous year to CHF 160 million as a result of a decline in direct investment income and higher write-downs on fixed-income securities and equities. Operating income before taxes decreased to CHF 74 million in 2022 (2021: CHF 110 million), mainly due to the decline in investment income.

In the business subject to the minimum ratio, 715 million Swiss francs accrued to policyholders in the form of insurance benefits, reserve reinforcements and allocations to the surplus fund. The payout ratio was thus 90.7 percent. Costs per active insured improved by 6 percent to 422 Swiss francs thanks to consistent efficiency efforts and the increase in the insured base.

Source and further information