Canadian Investment Review

Learn more about the DC Investment Innovation Award finalists

Written by Staff on Monday, November 16th, 2020 at 9:08 am

DC investment innovation award finalistsPension investments are a key component of ensuring secure benefits for plan members upon their retirement. To celebrate the plan sponsors and pension investors who work hard to ensure strong investment outcomes, the first-ever Pension Leadership Awards will recognize winners across several categories.

The Defined Contribution Investment Innovation Award will go to a DC pension plan that takes an innovative approach to its investment offerings either in the accumulation phase, decumulation phase, or both, or that has recently made changes to its investment lineup to improve plan member outcomes.

Highlights about the three finalists are available below:

Marsh and McLennan Companies

Marsh and McLennan Companies Inc. consists of nine affiliated Canadian organizations and approximately 3,000 employees across Canada. Effective Jan. 1, 2018, a DC plan was introduced on a go-forward basis and the legacy defined benefit pension plan was closed. The new DC plan was designed with a high level of flexibility. While all employer contributions are automatically allocated to a pension plan to provide long-term financial security, employees are able to decide whether to allocate their own contributions to the DC pension, or a savings plan that aligns with their own short, mid or long-term goals – allowing each employee to personalize their savings based on their priorities. On the investment front, Marsh and McLennan Co. set up white-labelled investment portfolios with custom multi-manager fund options available for each asset class. Employees are required to select their desired asset mix or a target-date fund. The company also has a default option, which differs depending on the savings goal of the employees. After retirement, employees can remain in the DC plan or move to a personal plan or a group payout product.

Ontario Medical Association/OMA Insurance

The Ontario Medical Association directed OMA Insurance to create and launch the advantages retirement plan in February 2020, which is open to more than 42,000 OMA members, as well as their spouses and common-law partners. The plan is comprised of a group registered retirement savings plan, a group tax-free savings account and a group registered retirement income fund. The Advantages Retirement Plan has an investment committee with fiduciary oversight and plan members can select from various investment options available. On the decumulation side, the plan has a guaranteed lifetime income feature that allows members to convert a portion of their savings into annuities. The advantages retirement plan also includes a digital tool that focuses on setting a target retirement income and can help members determine how much they can expect from government savings and how much they need to save. Despite the start of the coronavirus pandemic, the plan is continuing to grow with over $4 million in assets under management.

The Co-operators Group

The Co-operators Group pension plan has over $1 billion in assets under management and more than 7,000 active or deferred members. With combined contribution options of 13.5 per cent or 11.5 per cent, employees can join the plan immediately upon being hired and the plan has auto-escalation features so employee contributions rise as their salary increases. The Co-operators Group pension plan includes a balanced fund option that offers members four asset mix choices based on their risk tolerance. It also offers a pre-retirement fund for staff nearing retirement. Of note, 10 per cent of the fixed income portfolio is allocated to impact investing. Currently, upon retirement members can transfer assets to the Co-operators Life Co., which has a retirement income product that was designed specifically for retiring Co-operators employees. Further, the pension committee is researching the possibility of offering variable payments.

To find out who won the award, register today for the Defined Benefit Investment Forum, which will feature the Pension Leadership Awards Ceremony. Learn more: http://www.investmentreview.com/conference/defined-benefit-investment-forum-2020

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