The Decumulation (Payout) Phase of Defined Contribution Pillars : Policy Issues in the Provision of Annuities and Other Benefits

James, Estelle ; Vittas, Dimitri

World Bank, Washington, DC

关键词: AFFILIATED COMPANIES;    AGENTS;    ANNUITIES;    ANNUITIES MARKETS;    ANNUITY;   

DOI  :  10.1596/1813-9450-2464
RP-ID  :  WPS2464

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Most countries reforming their pensionsystem, focus more on the accumulation phase, than on thedecumulation (pay-out), because the number of beneficiariesis likely to be small initially, especially if older workersare discouraged from joining the new system. Policymakersplace a priority on the new accumulation system beingadministratively efficient, and well regulated. But thedecumulation phase must also be well organized, andefficient. The purpose of pension systems is, after all, topay retirement benefits - old age, survivor, and disabilitypensions. The authors argue that: 1) Pay-out arrangementsare likely to evolve gradually, through trial and error, asproblems are discovered and tackled. 2) Adverse selectionmay not be as great a problem as is sometimes thought. 3)Many other annuity, and insurance market problems have yetto be solved, and policies must be formulated to make thesemarkets work as well. The under-development of voluntaryannuity markets is only partly explained by adverseselection, argue the authors. Other factors are also atwork: the bequest, and precautionary motives for saving;individuals' myopia and ignorance; mistrust ofinsurance companies; the "luxury good" nature ofannuities; tax policies that favor lump sum withdrawals;and, last but not least, public policies (such as the offerof social security pensions and the encouragement ofoccupational pension plans) that tend to crowd outindividual annuities. The long-term success of pensionreform depends on vigorous efforts to develop the insuranceindustry. Weak and under-developed in most developingcountries, the insurance industry should play a central rolein providing old age, survivor, and disability benefits.Many policy issues require careful thought, and extensiveempirical analysis: Should annuitization be mandatory, andat what level? Should indexed (or "real")annuities be required? Should variable annuities bepermitted, or encouraged? Should joint annuities berequired? How much "group rating" and "riskclassification" should be permitted?