iING Asigurari de Viata has set itself as a target winning one million customers from the 3 million employee market of compulsory private pensions (pillar II), says Radu Vasilescu, pensions manager with the company.
"The compulsory private pension market will have 3 million customers, of whom ING wants to lure 1 million," says Radu Vasilescu. He says that half of the 3 million contributors will have the obligation to participate to the system, being aged below 35, while the rest will participate on a voluntary basis, being aged below 45. Overall, ING plans to grab a market share of around 33% of the number of customers.
ING Fond the Pensii, the pillar II specialised company of ING Asigurari de Viata, is the only company that has filed a licensing application for compulsory pensions for the time being. By August, when the sale campaign for these pensions starts, around ten management companies say they will be ready to enter this market.
As part of the race for customers, ING has earmarked an advertising campaign budget of more than one million euros, to also be destined to the promotion of optional private pensions (pillar III). Referring to the public campaign meant to inform the population on private pensions the authorities promised to launch in July, Vasilescu says he does not have very high expectations about it and that it will be the same first companies to sell the products that will have to assume the task of educating and informing clients.
Vasilescu also specified the optional pensions market, where the first contributions can be collected starting next month, will be seriously hurt by the overlapping campaign for compulsory pensions of August-November.
"The entire sales force of the market will focus on the compulsory pensions campaign. Optional pensions will be sold for two months at best, between May and July, after which everybody will focus on compulsory pensions," he considers.
Sales agents will be able to start looking for optional pension customers again after the pillar II campaign ends next January. Of this market, ING plans to gain a share of 25% of the total number of customers.
For now, a number of 2,111 ING marketing agents are subject to licensing procedures with the Private Pensions Commission, which will allow them to sell optional pensions. For compulsory pensions, they will have to be licensed again. Beside the 2,111 agents making up the sales force ING has used so far for life insurance, the company has also recruited a "flex-force" (the sales force to be used on the private pensions market) of several thousand agents.
ING has two optional pension funds ready that will invest 25% of the customers' money on the Stock Exchange and 75% in fixed-income securities.
How rivals are doing
Allianz-Tiriac is a pillar III (optional private pensions) manager and is setting up two funds
Aviva Romania, also a pillar III manager, is preparing one fund
BCR Viata, an optional private pensions manager, is also preparing one fund
OTP Garancia has filed a licensing application and has one fund on the same market of optional private pensions
Raiffeisen Asset Management has filed a licensing application and has one fund in pillar III
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