The Supplementary Pensions Law (WAP) requires employers to guarantee a minimum return on supplementary pension contributions for the duration of employees’ scheme membership. This minimum return is calculated on 1 June every year and takes effect on 1 January of the following year. Since 2016, it has been 1.75%; from 2025 it rises to 2.50%. How does this affect you as an employer?
The employer is responsible for the WAP guarantee and for ensuring the resulting minimum capital. If the insurer or pension fund fails to achieve the minimum guaranteed return, the difference must be made up by the employer. This change therefore has consequences for the pension plans in your company.
If your insurer offers an interest rate that is lower than the WAP guarantee, this may leave a shortfall that you will have to make up when your employee retires or leaves.
Since 2024, most insurers have offered a guaranteed interest rate of at least 1.75% on the premiums of Branch 21 group insurance policies. In older Branch 21 policies that still offer a guarantee on both premiums and reserves, most insurers’ guaranteed rate is less than 1% on premium increases. We do not immediately expect insurers to bring their interest rates up to the new WAP guarantee of 2.50%. Among other reasons, the current economic conditions make this difficult. Even after a profit share has been allocated, it is doubtful whether a total net return of 2.50% can be achieved.
It definitely makes sense to examine both the current return on your group insurance and the methodology used in the pension plan. To limit or even avoid unpleasant surprises such as underfunding, it may be advisable to consider other possibilities such as switching to Branch 21 group insurance with a higher guaranteed return, Branch 23 group insurance or a pension fund.
Would you like to know how this increase will affect your pension plans and what approach is best for your situation? If so, contact your Employee Benefits Account Manager at Vanbreda Risk & Benefits.
Are you the victim of an accident resulting in physical injury for which someone else is liable? If so, you are entitled to compensation. Thanks to the new 2024 Indicative Table, compensation for such injuries is now considerably higher. What’s changed and what does it mean? Find out below.
Increasing numbers of people on long-term sick leave and persistent labour market shortages have put the subject of incapacity for work high on the agenda. During a recent symposium, Lode Godderis, Professor of Occupational Medicine at KU Leuven and CEO of IDEWE, shared his insights into this complex challenge. He put this fundamental question to those present: are we addressing this growing problem the right way?
More than 500,000 Belgians are on long-term sick leave – and the number continues to grow by 5.5% every year. The impact on our social security system and on employers is significant. But there’s good news: the federal coalition agreement for 2025-2029 includes a definite commitment to change this. With a strong focus on prevention, faster reintegration and shared responsibility, government policy is shifting from a reactive to a proactive approach.
As an employer with activities in multiple countries, you want your employees to enjoy the same quality of healthcare and insurance wherever they are in the world. The challenge lies in managing employee benefits packages efficiently in a way that’s both compliant with local legislation and consistent with your global HR strategy. So how can you turn your international approach into an asset in the war for talent? And how can Vanbreda Risk & Benefits help you to do so?