동경의 OECD 연금회의

캐나다 밀레프스키 연금학 교수님이 지난달말 동경에서 열렸던 OECD회의 참가 후기를 남기셨습니다.

이 회의에서 교수님은 퇴직연금 등을 일시금이 아닌 연금으로 지급받는 것(소위 annuity puzzle 문제)이 얼마나 중요한지 강조하시고 연금지급을 확대하기 위한 아이디어(톤틴연금) 등을 발제하셨다고 참가자들로부터 들었습니다.

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자기가 여생동안 풍족하게 소비하는 것보다 자녀에게 유산을 남기고자 하는 상속동기(bequest motive)가 아시아쪽 국가들에서 두드러지게 나타나는 점, 미국 대형 보험회사의 아시아 문화권에 끼치는 거대한 영향력을 설명하고 가장 과감하게 톤틴연금을 받아들인 일본을 높게 평가하고 있네요.

 

출처 : https://www.linkedin.com/pulse/world-decumulation-moshe-arye-milevsky

OECD Meeting at the ADB. Tokyo. April 2018.

A World of Decumulation

Moshe Arye Milevsky

 

I recently spent a week in Tokyo, where among other engagements I was attending and speaking at an OECD-sponsored conference on insurance in Asia. Although the theme of the conference was quite broad and included discussions of cyber-security as well as climate-change and insurance, a full day was devoted to pensions and decumulation (a.k.a. drawdown strategies.)

The slides and presentations are here

The OECD which is based in Paris has been working on developing guidelines or best practices for global retirement income systems, which they are hoping will be adopted by the 35-member countries as well as outsiders who would like to join the exclusive OECD club. Needless to say, the OECD is nudging anyone who will listen away from unfunded Defined Benefit (DB) systems towards funded (DC-type) plans. This is not uncontroversial, mind you.

In addition to the formal conference keynotes and presentations -- very formal, it’s Japan after all – over the long breaks I had the opportunity to chat with government officials from Myanmar, Estonia, Indonesia, Thailand, Cambodia, Singapore and Dubai (and other places I would never dare visit.) Think of it as the United Nations of insurance and pension regulators, all in a safe conference room.

Over the course of two days I learned many new financial factoids which I'm not quite sure where to store in memory – for example, insurance sales in the Greater Mekong Sub-region are increasing by over 100% per year – and I collected many business cards, which by the way is still done in that part of the world. I also learned how to bow, which I really like.

On a more relevant note – listening to representatives from both industry and government – I was struck by the following: 

1.) Retirement income is truly a global concern and there is a growing awareness that financial literacy and education must go hand-in-hand with any product solutions. A perfect system is useless if consumers don’t understand it and appreciate it. People vote for things they understand.

2.) Many countries and regulators are still looking to the U.S. financial services sector and their companies for solutions, mainly because of their experience and scale. The big U.S. company names you would recognize were all there.

3.) The unique and peculiar culture of different countries often makes it impossible to implement solutions that would seem quite logical to a (western trained) financial economist. When I would ask: “Why did you design that particular feature in that odd way?” the response was: “Otherwise, it would never sell.”

4.) Life annuities are very popular and used as the bedrock of retirement income in some countries (Singapore, and to a certain extent India) but are either non-existent (e.g. Cambodia, etc.) or extremely unpopular in others. The bequest motive is a very powerful factor in these countries. I pledge to add them to my simple life-cycle utility functions going forward!

Finally, for those of you interested in innovative retirement income products, in April of 2016 the Japanese insurance company Nippon Life launched a tontine-type annuity. Yes. Moreover, they actually use the word tontine front-and-center in the product description. They are very proud of the 17th century heritage of the idea, with no marketing fears or image concerns. The word tontine is (by now) known to a much larger segment of the population. But then again, the temple Manji symbol is also growing in popularity. Yikes!