Why PPIs Can’t Afford to Leave Participant Understanding to Employers

The Wtp shifts investment risk to individuals — but it's PPIs, not employers, who must ensure participants actually understand what that means.

Picture a 45-year-old employee in Amsterdam. She has just received a letter from HR telling her that her pension scheme is transitioning under the Dutch Future Pensions Act (Wet toekomst pensioenen or Wtp). The letter explains the transition in paragraphs of lengthy text in small font size and the numbers look different from before. But nobody has told her what it means for her retirement and whether she should do anything about it.

This is not only a communications issue but a structural one, and it is one that PPIs can no longer afford to leave unresolved.

The old model no longer fits

For decades, the Dutch supplementary pension system was built on a straightforward promise: a defined benefit (DB), accrued collectively, administered at a distance. Employers played the role of intermediary: passing on the basics, leaving the detail to the fund. In a DB world, that was manageable. The promise was simple, stable, and required little active understanding from participants.

Under Wtp, that model is under significant strain. As a.s.r. vermogensbeheer’s investment head observed, pension capital is coming closer to participants than ever before, meaning that communication now plays a far more prominent role than the traditional DB world required. In the new system, investment risk shifts to the individual and outcomes are no longer guaranteed. Participants need to understand probability ranges, contribution levels, and the impact of their own choices.

That requires a fundamentally different kind of engagement. The Verbond van Verzekeraars has made this point explicitly: insurers and PPIs face the challenge of activating participants and helping them make suitable choices and that starts with personal communication.

The cost of inaction is rising

The AFM has been unambiguous about its expectations. In its 2025 supervision priorities, it announced intensified focus on pension communication for exactly this reason, identifying four principles PPIs must meet: clear language and concrete explanations; balanced communication about risks and uncertainties; reliable digital tools that actively support participant choice; and timely information about the impact of the transition on accrued rights and future benefits.

The regulator has already acted on these concerns. Following a review of transition statements submitted by early movers, the AFM raised the alarm that scenario amounts without personal explanation can lead to unrealistic expectations among participants and called on all pension administrators to address this urgently. In its Sector in Beeld Pensioenen 2025 report, the AFM confirmed it is actively monitoring this gap and expects pension administrators to provide personalised context around the scenario figures they present.

For PPIs, the message is clear: communication quality is now a supervisory matter, not just a service differentiator. Plans that fail to demonstrate genuine participant understanding risk regulatory pushback, reputational damage, and ultimately, loss of employer mandates.

Why employers cannot carry this burden alone

It is tempting to treat participant communication as a shared responsibility, and formally, it is. Dutch parliamentary documents on the Wtp transition acknowledge that the duty falls on both insurers/PPIs and employers. But in practice, the employer is not the right vehicle to carry the weight of participant understanding.

HR teams are not pension specialists, so the quality and depth of communication varies enormously across organisations. And crucially, employers have no incentive to go beyond the minimum required. When a participant is confused or disappointed by their pension outcome, it is the PPI whose brand is associated with that failure, not the HR department that forwarded the letter.

The structural argument has already been made by practitioners with direct PPI experience. A.s.r. vermogensbeheer’s analysis of participant behaviour found that even where participants could log in daily to see their pension position, it was the arrival of formal communications that prompted engagement and that insufficient context around those moments created confusion. The lesson drawn: communications from PPIs must come with more explanation, not less.

Simulation tools change the equation

The good news is that the tools to close this gap already exist. Digital simulation and forecasting platforms allow PPIs to embed participant-facing planning tools directly into their own portals, removing the employer as a dependency entirely.

Rather than presenting a participant with a static scenario figure and hoping the accompanying text does enough work, simulation tools can make the DC transition tangible and personal. A participant can see their projected pension across a range of outcomes: not a single optimistic number, but an honest probability distribution. She can adjust her contribution. She can model what happens if she retires two years later. She can understand, for the first time, what her pension pot actually means for her life.

This is precisely what the AFM is asking for when it identifies “reliable digital tools that actively support participants in making their choices” as a core communication principle. And it is where forward-thinking PPIs are already beginning to differentiate. Centraal Beheer PPI has explicitly cited Wtp as an opportunity for more transparency and better communication and framed it as a competitive advantage in attracting employers to their platform.

What good looks like

A participant logs into a PPI-owned portal. She sees her personal pension forecast: a range of likely outcomes, not a single figure. She moves a slider and sees what an extra €100 per month would mean at retirement. She understands the difference between a good-weather and bad-weather scenario. She leaves knowing what to do next.

Contrast that with the alternative: a statutory transition statement, a generic employer briefing, and a participant who still cannot explain what a DC pension means for her retirement. That is the experience that creates complaints, distrust, and regulatory scrutiny.

The PPIs that will lead the post-Wtp landscape are those that treat participant understanding as a core product feature: built into their platform, owned by them, not delegated to an employer. The transition deadline of January 2028 is approaching. The AFM’s supervisory lens is already on communication quality. The tools to act are available now.

The question is not whether PPIs can afford to invest in better participant engagement. It is whether they can afford not to.

Sources:

AFM, Sector in Beeld Pensioenen 2025. Autoriteit Financiële Markten, May 2025. https://www.afm.nl/en/sector/actueel/2025/mei/sb-sector-in-beeld-pensioenen

AFM, “Personele toelichtingen bij transitieoverzichten nog niet voldoende.” Autoriteit Financiële Markten, April 2025. https://www.afm.nl/en/sector/actueel/2025/apr/tb-transitieoverzichten

AFM, “Participant needs at the centre of intensified AFM supervision of the pension sector.” Projective Group summary, February 2025. https://www.projectivegroup.com/intensified-afm-supervision-pension-sector/

AFM, “Wtp Communication Plan Must Be More Concrete.” Projective Group, May 2024. https://www.projectivegroup.com/wtp-communication-plan/

A.s.r. vermogensbeheer, “Beleggen onder de WTP: lessen uit een PPI.” https://asrvermogensbeheer.nl/kennisbank/blogs/beleggen-onder-de-wtp-lessen-uit-een-ppi

Verbond van Verzekeraars, “Vijf vragen over pensioencommunicatie.” https://www.verzekeraars.nl/publicaties/actueel/vijf-vragen-over-pensioencommunicatie

Centraal Beheer PPI, “Opf of PPI: welke afwegingen maak je als werkgever?” Achmea. https://www.achmea.nl/inspiratie-duurzaam-werkgeverschap/pensioen/opf-of-ppi-welke-afwegingen-maak-je-als-werkgever

Tweede Kamer der Staten-Generaal, Vergaderjaar 2024–2025, 32 043 nr. 687 (Ministerial progress report on Wtp transition). https://www.eerstekamer.nl/behandeling/20250702/brief_regering/document3/f=/vmoqmz29glz0.pdf

Deloitte Netherlands, “The terms and deadlines of the Future Pensions Act at a glance.” https://www.deloitte.com/nl/en/services/consulting-financial/perspectives/de-termijnen-en-deadlines-van-de-wet-toekomst-pensioenen-op-een-rij.html

A&O Shearman, “The Future of Pensions Act (Wtp): What do employers need to know?” June 2025. https://www.aoshearman.com/en/insights/ao-shearman-in-the-netherlands/102kd2a/the-future-of-pensions-act-wtp-what-do-employers-need-to-know