What does it involve?
Page changed Tuesday, December 21, 2010
Instead of paying premiums for pension promises to an insurance company, client companies may, through the services of PRI Pensionsgaranti, retain capital in their business operations.
Meanwhile, credit insurance with PRI Pensionsgaranti guarantees your company’s pension commitments. Should any of our client companies become insolvent, PRI Pensionsgaranti will purchase pension insurances, in lieu of the company, equivalent to the pension commitments.
Application for credit insurance will be found at the top right hand column.
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Advantages with Credit insurance
- Employee pensions are guaranteed in case of an insolvency situation.
- No need to advance funds to an insurance company
- A company can retain pension capital in the business end employ the capital where best suited.
Premium
- The premium is 0, 3 % based on the debt that is calculated and reported as a liability at year end previous to the insurance period.
- For pension liabilities covered by assets held in a pension foundation the premium is 0, 1 %.
- During 2011 the minimum premium that applies is SEK 3000.
- Additional premium can be charged on special occasions as an alternative to security provisions. Additional premium is not taken into account for bonus payments to policyholders.
Bonus
PRI Pensionsgaranti mutual status allows the company to distribute surpluses from the operation to policyholders. The bonus is based on the total premium payments made during the last ten year period. As an example during the period 2005 – 2009 policyholders have paid MSEK 1300 in premiums and received MSEK 1800 in bonus returns.
Requirements on clients
- When applying for a credit insurance PRI Pensionsgaranti will asses the long term financial capacity, ownership and status of the company. Assessments are made on regular basis by PRI Pensionsgaranti and always when extending a contract.
- If the client is part of a group a surety bond from the parent needs to be provided.
- On certain occasions clients may be required to provide collateral in order to enter into an insurance contract.
Terms and amendments
- The credit insurance is offered for a period extending from one to three years.
- If PRI Pensionsgaranti would use its right to terminate a contract in advance, the contract shall be winded up during a five year period.
- According to the terms PRI Pensionsgaranti has the right to terminate the contract during a shorter period than five years on certain occassions.