Already in 2018 they were on the verge of extinction – now it is finally over for the Cologne pension fund and the sister company Caritas Versicherungsverein: the financial supervision Bafin withdrew their operating license. However, existing insurance contracts should continue to run. Pensions should also continue to be paid.
The reason for the end of the pension funds: They did not meet the minimum capital requirements and their financing plans to change this were inadequate, the Bafin said on Thursday Bonn With. The Bafin had already ordered in 2018 that the two cash registers were no longer allowed to go about their work. However, an objection was lodged – now the proceedings are over and the Bafin’s judgment is final.
According to Bafin, there has been no comparable case in the recent past.
The institutes have a total of 55,000 pensioners and beneficiaries. Your contracts and pensions will continue to run, the two cash registers will still exist – but as companies that are in liquidation and are no longer allowed to do new business.
The two funds announced that they will “continue to process their members’ existing pension contracts as planned.” Previous payments into existing contracts and the payment of pensions will continue. Only when the last payers, who are still young today, get their pensions and then at some point die, the topic is ticked off – that should take several decades.
However, there could be cuts: Policyholders had to accept cuts in benefits as early as 2018. This could be the case again in the future. However, it is unclear when and whether this will even be the case.
Because of Pension funds have been under pressure for a long time in the persistent phase of low interest rates. The promises made decades ago are very difficult to keep. The Bafin currently has around 20 of 80 life insurers and 36 of 135 pension funds under closer observation. Low interest rates have a stronger impact on health insurances than on life insurance because they almost exclusively have long-term pensions with sometimes high guarantees.