Coverage ratio

The percentage of obligations of pension funds covered by assets. The obligations are based on pension claims of fund participants and on their life expectancy.

The Pension Act of 2007 states that the total value of all assets of pension funds active in the Netherlands must exceed their (future) obligations by 5 percent.

By the end of 2009, the ABP Pension Fund, the Pension Fund Metal and Technology and the Retail Pension Fund had a coverage ratio below 105 percent. The coverage ratios of the pension funds Health Care and Welfare, Hotels, Restaurants & Catering and the pension fund for the construction sector had coverage ratios above 105 percent.

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