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Allianz Annual Report 2012

Annual Report 2012    Allianz Group Pensions and similar benefits The purpose is to provide competitive and cost-effective retirement and disability benefits using risk-appropriate vehicles. Board members participate in a contribution- based system covering Board service from 1 January 2005. Prior to 2005, Board members participated in a defined ­benefit plan that provided fixed benefits not linked to Base salary increases. Benefits generated under this plan were frozen at the end of 2004. Additionally, most Board mem- bers participate in the ­Allianz Versorgungskasse VVaG (AVK), a contribution-based pension plan and the ­Allianz Pensionsverein e.V. (APV), which provide pension benefits for salaries up to the German social security ceiling. Companycontributionstothecurrentpensionplandepend on the years of service on the Board of Management. They are invested in a fund with a guaranteed minimum interest rate per year. On retirement the accumulated capital is converted to a lifetime annuity. Each year the Supervisory Board decides whether and to what extent a budget is pro- vided. Independent from this decision, an additional risk premium is paid to cover death and disability. The earliest age a pension can be drawn is 60, except for cases of occu- pational or general disability for medical reasons. In these cases it may become payable earlier on. In the case of death, a pension may be paid to dependents. Surviving depen- dentsnormallyreceive60 %(survivingpartner)and20 %(per child) of the original Board member’s pension, with the ­aggregate not to exceed 100 %. Should Board membership cease prior to retirement age for other reasons, the accrued pension rights are maintained if vesting requirements are met. Perquisites Members of the Board of Management also receive certain perquisites. These mainly consist of contributions to acci- dentandliabilityinsurancesandtheprovisionofacompany car. Where applicable, expenses are paid for the mainte- nance of two households and in some cases security mea- suresareprovided.Perquisitesarenotlinkedtoperformance. Each member of the Board of Management is responsible for the income tax on these perquisites. The Supervisory Board reviews the level of perquisites. Target setting and performance assessment for variable remuneration Each year, the Supervisory Board agrees on performance targets for the variable remuneration with the members­ of the Board of Management. These are documented for the upcoming financial year and, every three years, for the respective mid-term period. 76