PFA CustomerCapital

PFA has a unique model for distribution of profit and risk that differs from that of other commercial pension companies, as it enables us to return profit to our customers. We call this PFA CustomerCapital. This is capital base in PFA Pension, which will receive a part of any profit, but will also take part in covering any losses. It gives you as a customer the possibility of obtaining an extra high return on the part of your savings that is paid to CustomerCapital. On the other hand, CustomerCapital is also associated with risk, which means that the CustomerCapital may be reduced (due to negative return) or, in the last resort, be completely lost.

FIND OUT IF YOU HAVE CUSTOMERCAPITAL AT MY PFA

How PFA CustomerCapital works

PFA Pension’s goal is to create as much value to the customers as possible. This is, among other things, ensured through the model for distribution of profit and risk that we call CustomerCapital. The main part of PFA Pension’s customers with pension savings currently accumulates CustomerCapital. The 2016 return on CustomerCapital was 20 % before pension yield tax, which meant that PFA Pension was able to add a total amount of approximately DKK 2.4 billion to the customers’ pension savings. The return from CustomerCapital may change in the future and may also result in a negative return. PFA Pension fixes part of the return and is therefore also entitled to make changes.  

 

CustomerCapital consists of Individual CustomerCapital and Collective CustomerCapital.

Individual CustomerCapital is your capital

If you have CustomerCapital, an amount corresponding to 5 % of your payments to your savings plan will be transferred to Individual CustomerCapital. With Individual CustomerCapital, you will receive a part of the return which, in other pension companies, would be allocated to the owners. Individual CustomerCapital forms part of the capital base in PFA, which makes up PFA’s financial strength.

Your individual CustomerCapital is a part of your total pension savings, and every year this part of your savings carries the interest of Individual CustomerCapital. 

 Interest on Individual CustomerCapital, per cent before pension yield tax            
 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 
 20.0 20.0 20.0 20.0 20.0 12.6 12.3 20.0 20.0 20.0 29.4 29.4  17.2

 

How return is added on Individual CustomerCapital

With Individual CustomerCapital, you get at least the same return as the return PFA generates on the shareholders’ equity. If you had CustomerCapital in 2016, the return amounted to 20 % before pension yield tax. The first 10 % were added during 2016 and the last 10 % will be added to your CustomerCapital in May 2017 (provided that you still have your PFA pension plan).
       

Collective CustomerCapital contributes to your return

PFA Collective CustomerCapital is a special bonus provision (reserve) which PFA’s owners created from the shareholders’ equity.

The PFA Foundation and the organisations that own PFA established this reserve for the benefit of PFA’s customers at any time who have Individual CustomerCapital. Collective CustomerCapital contributes to paying the extra return on Individual CustomerCapital. This means that an amount is transferred every year from Collective CustomerCapital to Individual CustomerCapital, and customers with Individual CustomerCapital thus receive a high return on their individual CustomerCapital. Over a number of years, Collective CustomerCapital will be distributed to both “existing” and “new” customers with Individual CustomerCapital.

Collective CustomerCapital is – as the name suggests – a collective reserve. This means that you cannot bring a share of Collective CustomerCapital if you transfer your pension plan to another pension supplier or if you cancel your pension plan.
       

What about the risk?

Along with equity and Collective CustomerCapital, Individual CustomerCapital forms part of PFA's capital base. When you accumulate savings in Individual CustomerCapital, PFA Pension’s customers will receive their share of the profit, which PFA Pension creates, although the purpose of Individual CustomerCapital is also to cover for any losses in PFA Pension. However, as long as Collective CustomerCapital remains, this will cover Individual CustomerCapital's share of any losses. When Collective CustomerCapital has been exhausted, Individual CustomerCapital will be subject to the same risk as equity. This means that Individual CustomerCapital may be reduced (due to negative return) and, in the last resort, be completely lost.

Individual CustomerCapital savings cannot be converted into regular savings. Thus, deselecting CustomerCapital means that no further payments will be made to CustomerCapital.

Generally, Individual CustomerCapital will follow the cancellation of the pension plan, for instance in connection with transfer to another pension supplier. This will not apply if PFA Pension does not meet the solvency requirement.
       

Opting in or out

Whether you can select or deselect CustomerCapital depends on the agreement that you, your employer or organisation has entered into with PFA.

If you deselect CustomerCapital, payments will no longer be made to your individual CustomerCapital, but already accumulated Individual CustomerCapital will be maintained.

 

Average interest rate, payouts and CustomerCapital

When the payouts from your average interest rate plan begin, it is no longer possible to have CustomerCapital. Instead, your individual CustomerCapital will be transferred to your savings.

Regulations on CustomerCapital – market rate

Regulations on calculation and distribution of realised results for pension plans in PFA Plus with the investment concept PFA Invests

1 Legal framework, etc.
These regulations describe how PFA Pension calculates and distributes realised results for pension plans in PFA Plus with the investment concept PFA Invests according to Section 20 (1) No. 3 of the Danish Financial Business Act. These regulations do not apply to PFA Plus with average interest rate.

2 Notification and ongoing changes
PFA Pension must report the rules for calculation and distribution of the realised results to the insured and other persons entitled in accordance with pension plans to the Danish Financial Supervisory Authority. These regulations state these rules in outline. PFA Pension may change these rules and these regulations without any notice. PFA Pension reports ongoing changes of the rules to the Danish Financial Supervisory Authority.

The access to changing these rules on a current basis follows the pension terms for the pension plans.

3 Realised results
The realised results for pension plans in PFA Plus with the investment concept PFA Invests are determined for each pension plan as 5 per cent of the payments to savings in the investment concept PFA Invests. The rate is applied for regular payments, lump sum payments as well as transfers from other pension suppliers. By notifying the Danish Financial Supervisory Authority, PFA Pension can change the rate without any notice, including reducing it to zero.

An additional realised result of 5 per cent of the total deposit under the concept PFA Invests and Individual CustomerCapital less the current Individual CustomerCapital deposit is defined for policies that are comprised by CustomerCapital under the investment concept PFA Invests and that, as of 1 July 2011, have received a transfer during the year from a PFA average interest rate plan or from another policy under the investment concept PFA Invests. This realised result cannot be negative and is determined during the quarter when the transfer took place.

The total realised results are fully transferred to Individual CustomerCapital for each pension plan in PFA Plus with the investment concept PFA Invests which is covered by Individual CustomerCapital. It applies to pension plans in PFA Plus with the investment concept PFA Invests which is not comprised by Individual CustomerCapital that the total realised results fully form part of the pension plans’ savings.

4 Definition of CustomerCapital
CustomerCapital is special bonus provisions, type B, in accordance with Section 32 of the Danish executive order on capital base determination. CustomerCapital consists of Individual CustomerCapital (see further information below in Section 6) and Collective CustomerCapital (see further information below in Section 8).

CustomerCapital forms part of the capital base on equal terms with shareholder's equity. The capital base is the subordinate capital which an insurance company must hold according to legislation. CustomerCapital must partly cover the same positive and negative items which PFA Pension at any time determines that the shareholder’s equity must cover, and partly the same losses which the shareholder’s equity must cover. CustomerCapital may therefore be reduced when covering any losses on the insurance operations and other negative items. As mentioned below in Section 8, the risk of reduction of Individual CustomerCapital is limited as long as Collective CustomerCapital exists.

If a pension plan is comprised by CustomerCapital, it will appear from the pension certificate.

5 Statement of Individual CustomerCapital
Individual CustomerCapital is determined in the following manner:

+ Individual CustomerCapital at the beginning of the period
+ Transfer                    (Section 6)
+ Return etc.                (Section 7)
- Cover of loss etc.       (Section 4)
- Payout                       (Sections 9 and 10)
- Pension yield tax        (Section 12)
= Individual CustomerCapital at the end of the period

6 Transfer to Individual CustomerCapital
Individual CustomerCapital is accumulated by way of a transfer of the pension plan’s realised results as mentioned in Section 3. CustomerCapital is only accumulated for savings in the investment concept PFA Invests. Payments to insurance cover do not form part of the accumulation of Individual CustomerCapital.

Individual CustomerCapital that has already been accumulated on a pension plan that comprises CustomerCapital will be transferred to Individual CustomerCapital in PFA Plus by way of an internal transfer to PFA Plus.

7 Return etc. on Individual CustomerCapital
During a calendar year, Individual CustomerCapital will carry a preliminary interest before pension yield tax that is fixed monthly in advance.
The return on CustomerCapital is calculated annually before pension yield tax and corresponds, as a minimum, to the annual return on the shareholders' equity before corporation tax. On approval of PFA Pension’s Annual Report at the company’s Annual General Meeting, the return on equity is also approved, and the return on Individual CustomerCapital is adjusted if the return on equity deviates from the preliminary interest that has been ascribed to Individual CustomerCapital during the year. The return on shareholders' equity may be positive or negative.

The adjustment takes place before the end of May in the following calendar year, and it only applies to the pension plans that are in force at the date of the adjustment.

In addition, a so-called survival profit will, on a regular basis, be added to any Individual CustomerCapital linked to a temporary or lifelong life pension. This survival profit is calculated based on the share of the Individual CustomerCapital in question that lapses in the event of the death of the pensioner or any beneficiaries appointed by the pensioner as well as on a provisional mortality rate that is fixed monthly in advance.

In connection with the approval of PFA Pension’s Annual Report at the Company’s Annual General Meeting, PFA’s Board of Directors may decide that the survival profits related to Individual CustomerCapital should be adjusted if required as a result of the experience report on Individual CustomerCapital linked to life pensions. However, the survival profit cannot be negative.

The adjustment takes place before the end of May in the following calendar year, and it only applies to the pension plans that are in force at the date of the adjustment.

As long as Collective CustomerCapital exists, it will act as a safety net for Individual CustomerCapital and the return of this etc., including any negative adjustment of the return as mentioned below in Section 8.

8 Collective CustomerCapital
In connection with the transfer of CustomerCapital, PFA Pension transferred an amount from shareholder’s equity to Collective CustomerCapital.

Collective CustomerCapital inclusive of return and any new transfers from the shareholders' equity is distributed among the pension plans comprised by Individual CustomerCapital. This is done by:

-
ensuring that Individual CustomerCapital carries at least the same interest as ascribed during the year, and
- partly covering Individual CustomerCapital’s proportionate share of the positive and negative items which PFA Pension at any time determines that the shareholder’s equity must cover, and partly covering the same losses which the shareholder’s equity must cover, as mentioned above in Section 4.

This means that the preliminary interest is fixed in a manner where Collective CustomerCapital is expected to be distributed over a number of years.

PFA Pension is free to decide on a final distribution of Collective CustomerCapital.

9 Payout of Individual CustomerCapital
Individual CustomerCapital is paid out concurrently with the payout of a pension plan's savings in the investment concept PFA Invests. See, however, Section 10 about payout when a pension plan is cancelled. Individual CustomerCapital is also paid out if a pension plan lapses without payout of savings. Before Individual CustomerCapital is paid out, taxes and fees are deducted according to the Danish Pension Yield Taxation Act, the Danish Pension Taxation Act and any other applicable Danish legislation.

PFA Pension lays down the detailed rules regarding the payout of Individual CustomerCapital when a pension plan is paid out or cancelled. This is done in the rules notified to the Danish Financial Supervisory Authority at all times as mentioned above in Section 2.

10 Cancellation of a pension plan
On cancellation of a pension plan, Individual CustomerCapital is paid out with the pension plan’s value on cancellation, provided that PFA Pension meets the solvency requirement in Section 32(1), No. 6 of the Danish executive order on capital base determination. Before Individual CustomerCapital is paid out, taxes and fees are deducted according to the Danish Pension Yield Taxation Act, the Danish Pension Taxation Act and any other applicable Danish legislation.

PFA Pension shall fix the maximum percentage of Individual CustomerCapital in the remaining savings in connection with partial surrender. This is done in the rules notified to the Danish Financial Supervisory Authority at all times as mentioned above in Section 2. Any excess Individual CustomerCapital shall be transferred to the savings.

Individual CustomerCapital cannot be separately disposed of.

11 Transfer to another investment concept in PFA Plus
When savings and/or future payments are transferred to another investment concept where Individual Customer Capital is not accumulated, any already accumulated Individual CustomerCapital will be maintained. However, this does not apply if the value of Individual CustomerCapital amounts to less than DKK 500 when the accumulation of Individual CustomerCapital is deselected. In this case, the value will be transferred to the savings instead.

12 Pension yield tax
CustomerCapital will be reduced by pension yield tax in accordance with Danish legislation.

13 Effective date
These regulations take effect on 1 June 2014.

Regulations on CustomerCapital – average interest rate

Regulations on calculation and distribution of realised results for the insurance agreements for insurance plans established on the following bases of calculation G82 5 %, G82 3 %, G82 3.7 %, G82 2 %, Uni98 2 %, L99 and U10

1 Legal framework, etc.
These regulations describe how PFA Pension calculates and uses allocated shares of realised partial results for insurance agreements with deposit interest rate (average interest rate insurance plans) according to Section 20 (1) No. 3 of the Danish Financial Business Act. These regulations do not apply to PFA Plus.

These regulations replace the reported “Regulations on calculation and distribution of realised results for the insurance agreements for insurance plans established on the following bases of calculation G82 5 %, G82 3 %, G82 3.7 %, G82 2 %, Uni98 2 %, L99 and U10” of 1 July 2011.

2 Notification and ongoing changes
PFA Pension must report the rules for calculation and distribution of the realised results to the insured and other persons entitled in accordance with the insurance agreements to the Danish Financial Supervisory Authority. These regulations state these rules in outline. PFA Pension may change these rules and these regulations without any notice. PFA Pension reports ongoing changes of the rules to the Danish Financial Supervisory Authority.

The regulations allow PFA Pension to change the application of bonus for policies issued before 1 December 2005. For policies issued after 1 December 2005, the access to changing the application of bonus is stated in the policy.

Chapter 1: The realised partial results

3 Realised results
The realised results for PFA Pension are calculated according to the Danish Executive Order on the Contribution Principle.

The realised results are distributed according to the rules reported to the Danish Financial Supervisory Authority between PFA’s capital base, CustomerCapital according to Section 12 in these regulations and insurance plans according to the Contribution Principle.

Specifically, the insurance plans’ total share of the realised results are distributed to the collective bonus potentials in the reported contribution groups. Then, the realised partial results for the individual insurance plan will be distributed evenly. The transfer to the individual insurance plan will be distributed to the following:
1. Individual CustomerCapital, as described in Chapter 2
2. Consolidation, as described in Chapter 4
3. Transfer allowance, as described in Chapter 5
4. Bonus, as described in Chapter 6

The distribution is stated in order of priority.

4 Calculation of the insurance plan’s share of the transfer from the realised results
The insurance plan’s share of the transfer from the realised results are generally determined monthly as the difference between (1) the calculated deposit at the end of the period before the transfer to and from Individual CustomerCapital and (2) the net reserves of the insurance plan. However, the insurance plan’s allocated share of the realised partial results makes up at least the amount that, according to Section 10, is transferred to Individual CustomerCapital and the amount that, according to Section 17, is used for consolidation.

The net reserve is the amount that PFA Pension, according to the insurance plan’s basis of calculation, must make provisions for the present insurance benefits.

The deposit of the insurance plan before the transfer to and from Individual CustomerCapital can be determined as follows:

Deposit at the beginning of the period
+ deposit interest rate etc. (Section 5)
+ payments after labour market contribution
- insurance cover (Section 6)
- administration (Section 7)
- pension yield tax (Section 16)
- payouts
_________________________
Deposit at the end of the period before the transfer to and from CustomerCapital

+ transfer from Individual CustomerCapital (Section 14)
- transfer to Individual CustomerCapital (Section 10)
_________________________
Deposit at the end of the period

5 Deposit interest rate etc.
The deposit accrues interest at the fixed deposit interest rate before tax.

The applied rates for deposit interest rate are stated in the technical basis. The rates are subject to future changes without notice in connection with a new report to the Danish Financial Supervisory Authority.

In addition, a transfer allowance may be included, as mentioned below in chapter 5.

6 Insurance cover
PFA Pension fixes the probability for death and disability etc. based on our experience and expectations of the development in mortality and disability etc.

The payment for the insurance cover is calculated based on the fixed probabilities and the difference between the present deposit and the amount that, according to the technical basis, must be set aside to cover future payouts in the event of death or disability etc.

PFA Pension can fix a special payment for large groups or groups with special risk depending on the expected risk that applies to the group.

For groups of insurance plans, there may be an agreement on reversal of risk profit to the insurance plans.

The applied rates for payment of insurance cover are stated in the technical basis. The rates are subject to future changes without notice in connection with a new report to the Danish Financial Supervisory Authority.

7 Administration
PFA Pension calculates a deduction from the payments to cover administrative expenses. The deduction percentage depends on the simplicity of the administration and the size of the payment. A fee will be deducted from insurance plans with small or no payments.

PFA Pension may charge a fee if customers request especially cost-consuming calculations or changes.

The applied expense rates are stated in the technical basis. The rates are subject to future changes without notice in connection with a new report to the Danish Financial Supervisory Authority.

The deposit and payments may be subject to expenses that are agreed between the policyholder and any related broker.

Chapter 2: CustomerCapital

8 Definition of CustomerCapital
CustomerCapital is special bonus provisions, type B, in accordance with Section 32 of the Danish executive order on capital base determination. CustomerCapital consists of Individual CustomerCapital (see further information below in Section 10) and Collective CustomerCapital (see further information below in Section 13).

CustomerCapital forms part of the capital base on equal terms with shareholder's equity. The capital base is the subordinate capital which an insurance company must hold according to legislation. CustomerCapital must partly cover the same positive and negative items which PFA Pension at any time determines that the shareholder’s equity must cover, and partly the same losses which the shareholder’s equity must cover. CustomerCapital may therefore be reduced when covering any losses on the insurance operations and other negative items. As mentioned below in Section 13, the risk of reduction of Individual CustomerCapital is limited as long as Collective CustomerCapital exists.

An insurance is comprised by CustomerCapital if so appears from the policy, endorsements or appendices.

9 Statement of Individual CustomerCapital
Individual CustomerCapital is determined in the following manner:
+ Individual CustomerCapital at the beginning of the period
+ Transfer (Section 10)
+ Return (Section 12)
- Cover of loss, etc. (Section 8)
- Payout (Sections 14 and 15)
- Pension yield tax (Section 16)
________________________
= Individual CustomerCapital at the end of the period

10 Transfer to Individual CustomerCapital
Individual CustomerCapital is accumulated by transferring a part of the insurance plans’ share of the realised partial results, or positive part elements of the insurance plans’ share of the realised partial results. Individual CustomerCapital is not accumulated for the insurance plans or insurance parts stated in Section 11.

The size of the accumulation corresponds to a share of payments (after labour market contribution) to the insurance plans and of deposit transferred from another pension supplier to the insurance plans, except payments and transfers to the insurance plans or insurance parts stated in Section 11. Individual CustomerCapital is only accumulated in connection with payments and the mentioned transfers of deposits.

The applied rate for transfer to Individual CustomerCapital are stated in the technical basis. By notifying the Danish Financial Supervisory Authority, PFA Pension can change the rate without any notice, including reducing it to zero. The rate does not explicitly depend on the individual insurance plan’s affiliation to contribution groups.

11 Insurance plans and insurance parts without Individual CustomerCapital
Individual CustomerCapital is not accumulated for the following insurance plans or insurance parts:
- Sickess and accident insurance, including PFA Critical Illness, PFA Health Insurance and PFA Ulykkesikring (PFA Accident Insurance)
- Group cover
- Group term life insurance
- Insurance cover without any right to bonus (this, however, does not apply to PFA Plus insurance plans) and Special insurance cover, including special insurance cover that is exempted due to technical or administrative reasons.

Furthermore, additional Individual CustomerCapital is neither accumulated as a consequence of transfers of deposits between insurance plans comprised by these regulations nor as a consequence of internal deposit transfers within the PFA Group from insurance plans that are not comprised by these regulations. Individual CustomerCapital that has already been accumulated is, however, transferred to Individual CustomerCapital for the receiving pension plan by way of an internal deposit transfer from a ceding to a receiving pension plan, both comprised by Individual CustomerCapital.

12 Return on CustomerCapital
During a calendar year, Individual CustomerCapital carries a preliminary interest before deduction of pension yield tax that is fixed monthly in advance.

The return on CustomerCapital is calculated annually before pension yield tax and corresponds, as a minimum, to the annual return on the shareholders' equity before corporation tax. On approval of PFA Pension’s Annual Report at the company’s Annual General Meeting, the return on equity is also approved, and the return on Individual CustomerCapital is adjusted if the return on equity deviates from the preliminary interest that has been ascribed to Individual CustomerCapital during the year. The return on shareholders' equity may be positive or negative.

The adjustment takes place before the end of May in the following calendar year, and it only applies to the insurance plans that are in force at the date of the adjustment.

As long as the collective CustomerCapital exists, this will act as a safety net for individual CustomerCapital and the return of this, including any negative adjustment of the return as mentioned below in Section 13.

13 Collective CustomerCapital
In connection with the introduction of CustomerCapital, PFA Pension has transferred an amount from the capital base to Collective CustomerCapital.

Collective CustomerCapital inclusive of return and any new transfers from the shareholders' equity is distributed over a number of years among the insurance plans comprised by Individual CustomerCapital. This is done by:
- ensuring that Individual CustomerCapital carries at least the same interest as ascribed during the year, and
- partly covering Individual CustomerCapital’s proportionate share of the positive and negative items which PFA Pension at any time determines that the shareholder’s equity must cover, and partly covering the same losses which the shareholder’s equity must cover, as mentioned above in Section 8.

The preliminary interest rate is fixed based on the expectation that Collective CustomerCapital is distributed over a number of years.

PFA Pension is free to decide on a final distribution of Collective CustomerCapital.

14 Transfer of Individual CustomerCapital
An amount from Individual CustomerCapital must be transferred to the deposit of the insurance plan no later than at the same time as payouts are made from the insurance or premium waiver is granted. However cf. Section 15 about surrender.

PFA Pension lays down the detailed rules regarding the use of CustomerCapital when Individual CustomerCapital is transferred to the deposit in connection with payout of the insurance. This is done in the rules notified to the Danish Financial Supervisory Authority at all times as mentioned above in Section 2.

15 Surrender
In case of surrender of an insurance plan, Individual CustomerCapital is paid out along with the insurance plan’s deposit, provided that, on the date of the surrender, PFA Pension meets the solvency requirement in Section 32(1), No. 6 of the Danish executive order on capital base determination. Before Individual CustomerCapital is paid out, taxes and fees are deducted according to the Danish Pension Yield Taxation Act, the Danish Pension Taxation Act and any other applicable Danish legislation. PFA Pension fixes the maximum percentage of Individual CustomerCapital in the remaining deposit in connection with partial surrender. This is done in the rules notified to the Danish Financial Supervisory Authority at all times as mentioned above in Section 2. Any excess Individual CustomerCapital will be transferred to the deposit.

Individual CustomerCapital cannot be separately disposed of.

Chapter 3: Pension yield tax

16 Pension yield tax
Deposit and Individual CustomerCapital will be reduced by pension yield tax in accordance with Danish legislation. PFA Pension annually determines and settles the pension yield tax with SKAT (the Danish Tax Authorities).

The tax base comprises the deposit interest rate, as described in Section 4, and the interest on any Individual CustomerCapital, as described in Chapter 2, with the following corrections:
- A share corresponding to that part of the deposit that existed on 1 January 1983 will be deducted. This share is exempt from pension yield tax.
- A proportionate share of PFA Pension’s expenses for insurance cover and administration, if any, that is not covered by the customers’ payment of insurance cover and administration will be included.
- A transfer allowance may be included, as mentioned in Chapter 5.

Pension customers who are not fully liable to pay tax in Denmark, or are resident abroad according to a double taxation agreement, can obtain tax exemption by sending an application to SKAT (the Danish Tax Authorities).

The deposit return and any Individual CustomerCapital return for insurance plans established according to Section 53A of the Danish Pension Taxation Act is exempt from pension yield tax.

Chapter 4: Consolidation

17 What is consolidation?
Consolidation is an integral part of the insurance deposit. Consolidation is used for securing the agreed payouts. This means that even though the deposit is increased more than anticipated in connection with the establishment of the insurance plan, the agreed payouts will not be increased. This way, the deposit can finance the agreed payouts itself, even though interest rate, expenses and/or risk are less favourable than anticipated at the establishment of the insurance plan. Accumulation of consolidation stops, at the latest, when the deposit can finance the already agreed payouts based on the basis of calculation that will be used in case of any increases of insurance payouts.

18 How is consolidation accumulated?
After transfer to CustomerCapital, the rest of the transfer from the insurance plans' share of the realised results can fully or partially be used for consolidation.

The consolidation may be reduced if the transfer of the realised results after deduction to CustomerCapital is negative - or if the need for securing the agreed benefits is reduced. However, the consolidation cannot be negative.

Chapter 5: Transfer allowance

19 Determining the transfer allowance

If the deposit value, or part of it, for an insurance plan that is covered by these regulations is transferred to a market rate insurance plan in PFA Plus, a transfer allowance will be added to the transferred amount. However, the following limitations apply:
- If Individual CustomerCapital has been accumulated for the insurance which the deposit value or part of it is transferred from, no transfer allowance will be accumulated for that part of the transfer that is made for Individual CustomerCapital.
- A transfer allowance can only be added once for the same funds.

The transfer allowance rate may depend on the interest group of the insurance. The rates are subject to changes without notice in connection with a report to the Danish Financial Supervisory Authority, and may be reduced to zero.

Chapter 6: Bonus

20 Calculation of bonus
Bonus is calculated as the insurance plan’s share of the realised result after any deduction to CustomerCapital cf. chapter 2, consolidation cf. chapter 4 and transfer allowance cf. chapter 5. If the above-mentioned balance is negative, the bonus will be fixed at 0, but the loss will be registered. This means that the loss will have to be covered before any bonus is possible.

Chapter 7: Effective date

21 Effective date
These regulations take effect on 1 September 2013.