Grawe: Pensions could see cause drop in life insurance sales

Sales of life insurance policies could witness a decline in the second half of this year, as companies’ agents turn their attention to the distribution of mandatory pensions, believes Peter Kasyk, general manager of Grawe, a company specialising in life insurance. “This year will be different for the life insurance market, no one knows what is going to happen. Agents will concentrate on selling mandatory pensions and we could see sales of life insurance policies declining, which has happened in other countries,” Kasyk states. “For agents, it will be easier to sell second pillar pensions than life insurance products, because they are mandatory and the products are very similar,” added Kasyk. The mandatory pensions (the second pillar) system could start on August 1 and would see all employees below 35 having to choose a fund, with 2% of their social security contributions being transferred within the next four months, i.e. by the end of November. According to the Private Pension Supervision Commission (CSSPP), the opening date for joining mandatory pensions could be delayed till August 31, as the pension companies have not had sufficient time to organise their activities or get their sales teams ready.