Paid-up policy

If your paid-up policy includes disability pension cover, you may be entitled to a payout in the event of disability. Information about supplementary cover can be found in DNB's online bank. You can also report disability here.

Paid-up policies with unit-linked products only provide cover for retirement pension. If your ordinary paid-up policy has supplementary cover when converting to a paid-up policy with unit-linked products, the supplementary cover will remain in the ordinary paid-up policy.

The payout date and payout period, as agreed in the ordinary paid-up policy, will continue when converting to a paid-up policy with unit-linked products.

When the payout begins, you will once again be able to choose the investment management during the payout period. You can then choose guaranteed return or unit-linked products.

For the vast majority of paid-up policies, retirement pension is paid out from age 67. However, you can choose to start the payment from age 62 at the earliest. You can also defer the payment, starting no later than age 75. If you wish to change the payment date, you must notify us.

If you start payout of retirement pension earlier than agreed, this will affect how much you receive annually, because the funds will be distributed over more years.

If you are partially incapacitated for work, the sum of disability pension paid out and retirement pension can amount to a maximum of one hundred per cent of the retirement pension benefit. Payout of disability pension generally stops when you turn 67.

You can draw retirement pension while receiving a salary.

If your paid-up policy has dependant's pension, such as spouse's/cohabitant's pension or child's pension, these will be paid out upon death. The cover cannot be changed or removed. You will find more information about this in your account statement in the mailbox in DNB's online bank.

Remaining retirement pension will not be paid out to survivors upon death. The capital belonging to the retirement pension will be distributed among other customers with paid-up policies in DNB Livsforsikring. This applies to both ordinary paid-up policies and paid-up policies with unit-linked products.

Who is a paid-up policy with unit-linked products suitable for?

A paid-up policy with unit-linked products is best suited for you if you want the opportunity to influence the return, and at the same time have more than ten years left until retirement age. When converting to a paid-up policy with unit-linked products, you waive the guaranteed return. We generally do not recommend converting to a paid-up policy with unit-linked products if your ordinary paid-up policy has a guaranteed return of three per cent or higher.

We recommend that you plan for your retirement early.

The first step is to gain an overview of how much you can expect to receive in pension.

Furthermore, you should consider the timing of when you wish to start the payout of your pension.

Read more about pension planning and get useful tips here.

Until the pension is withdrawn, there is no taxation of the paid-up policy. When the payout begins, it is taxed as pension income.

This means increasing the annual pension payment in exchange for reducing the payment period. The capital is therefore paid out more quickly than originally agreed.

For paid-up policies with a low annual pension (below 30 per cent of G), the payment will automatically be recalculated to an annual payout of approximately 30 per cent of G and the payment period will be shortened.

In many cases, the payment period can also be shortened further by increasing the payment to 50 or 100 per cent of G. This is called voluntary recalculation. The minimum payment period is twelve months. You must decide whether you wish to have a voluntary recalculation from the time you start drawing your retirement pension. It is not possible to make a new recalculation for paid-up policies that are already in payout.

Please feel free to speak with a pensions adviser about what suits you best.

What does the paid-up policy cost?

In a paid-up policy, the main principle is that costs associated with administration and management are covered by the employer through payment of a lump sum.

This lump sum is used to cover future costs. A fee related to asset management is also charged, which is deducted from the return (external management costs and performance-based fees).

A paid-up policy cannot be transferred to or from another pension provider.

If you have a paid-up policy with unit-linked products, this can be transferred to us.

Your paid-up policy has a guaranteed annual pension amount. For the payout to be larger than agreed, the ordinary paid-up policy must achieve a higher rate of return than the guaranteed return. Paid-up policies are not adjusted in line with inflation or changes in the National Insurance basic amount.