Pension firms under scrutiny

It is not okay that Faroese pension firms have lower profit margins than their Danish counterparts.

If this continues, we need to consider opening up for more competition, says Bárður á Steig Nielsen, leader of Sambandsflokkurin (the Union Party). A recent study carried out by Tryggingareftirlitið (the Insurance Watchdog) shows that in the 2011-2016 period, the returns on investments were almost twice as high for pension firms Denmark as in the Faroes.

This can affect people’s pension payouts, says Jógvan Thomsen, CEO of the Insurance Watchdog, which will now look into the matter to ensure that everything is being done by the book.

According to Jan Jakobsen, CEO of pension and insurance company LÍV, Faroese pension firms have been hampered by a number of circumstances, including complications regarding taxation of pension income.

Óluva í Gong, the head of the Nurses’ Union, says that the study period is too short to provide a sufficiently accurate picture.

Faroese citizens should have a right to decide about their pension funds, say insurance advisor Kim Hansen and Turið Finnbogadóttir Arge, works manager at BankNordik. As the existing law dictates that pension funds should be saved up in Faroese institutions, Faroese citizens do not currently have that right.

Translated by prosa.fo