The AVRG is law: what the Altersvorsorgedepot means for providers

Under the German pension reform act (AVRG), the Altersvorsorgedepot replaces the Riester pension in new business from 1 January 2027: a securities account rather than an insurance wrapper, still supported by the state. The basic allowance rises in stages to €540 a year, plus €300 per child. For providers this is less a product question than an operating question, because the act ties new business and the existing book together.

A securities account, not an insurance wrapper

The difference between the Riester pension and the Altersvorsorgedepot is structural, not cosmetic. What is subsidised in future is a securities account, and no contribution guarantee is prescribed inside it: the Altersvorsorgedepot has neither a guaranteed minimum capital nor a guaranteed minimum performance (§ 1(1b) AltZertG). Anyone who wants protection buys it as a product variant rather than receiving it by statute.

That shifts the economics of the product. In the Riester world the contribution guarantee was paid for through the investment and limited its return potential; once that constraint falls away, what a contract costs and how it is managed over its life matter far more. The statutory cost cap of one per cent a year applies only to the Standarddepot, though (§ 1(1c) AltZertG); freely distributed variants are not covered by it. Cost competition therefore becomes a genuine point of difference rather than a footnote in the key information document.

The subsidy logic is new as well, and it is proportional to what is paid in. The basic allowance rises in stages to €540 a year. The child allowance is €300 and is counted per child rather than as a shared pot (§ 85 EStG). Anyone who wants the subsidy has to pay a minimum own contribution of €120 a year, in full: § 86 EStG has no pro-rata reduction here, only an all-or-nothing threshold. For target groups paying small amounts, that is the decisive figure in the act.

The framework stands, parts of the implementation do not

The act has been promulgated and comes into force on 1 January 2027. What is still outstanding is part of the implementation: statutory instruments under the certification act for retirement provision contracts, decisions around the product information body and the sponsorship of the Standarddepot. A BaFin statement written specifically for the Altersvorsorgedepot has not yet appeared.

For planning purposes that distinction matters more than it sounds. The product framework is solid enough to build on; individual points of detail are not. Providers preparing certification, advice journeys and operations now should therefore treat the open items as configuration rather than concrete, as parameters that can change without the journey having to be rebuilt.

The product framework is solid enough to build on. Individual points of detail are not, yet.

Retirement provision contracts continue to be certified by the certification body under the AltZertG at the Federal Central Tax Office. The six-digit certification number appears on every customer contract, an inconspicuous detail with practical consequences for work on existing books, because it allows an exact tariff match when old contracts have to be assessed.

New business and the existing book can no longer be separated

The rule with the greatest consequences for providers sits in tax law rather than product law. Under § 52(50a) EStG the subsidy declaration is irrevocable, and it applies uniformly to every retirement provision contract a person holds. More than that: taking out a new contract from 2027 converts the existing ones by operation of law, even without an explicit declaration. The effect extends to a spouse as well.

The familiar division of labour, new business here, existing book there, cannot survive that. Anyone selling a customer an Altersvorsorgedepot in 2027 changes the subsidy regime of her existing contracts in the same moment. This is not an edge case: it applies to every advice session in which an old contract exists, and Germany holds around 15 million Riester contracts with roughly €140 billion in assets.

The act draws a consequence from that for distribution. § 7d AltZertG requires an explicit notice of these legal effects, before the subsidy declaration and before the contract is concluded, not afterwards. Anyone who first reviews their advice process against it in 2027 is reviewing it too late.

What providers do now

Product and certification

An Altersvorsorgedepot has to be developed, certified and documented as an eligible product: investment concept, cost model, target market determination, key information documents. That is a chain with a duration of its own, and it starts with product development rather than distribution. Anyone who does not want to build it configures a finished, certified product to their own brand, which shortens the chain, but does not replace the decision about which cost and investment model you are prepared to defend.

Advice and documentation

Where a Riester contract meets a securities account, two supervisory regimes run side by side: §§ 61, 62 VVG on the ceding insurance side, § 64 WpHG (or § 18 FinVermV) on the receiving securities side. Both sides have to be documented. At the heart of the suitability statement is then a cost-benefit analysis of the switch with an explicit conclusion on whether the advantages outweigh the disadvantages, including the alternatives considered. That is not a form; it is a process.

Operations and allowance handling

Subsidised provision lives on small contributions. A contract at the €120 threshold cannot carry manual handling, not in the allowance procedure, and not for contribution changes, documents or lifecycle management. The product only becomes economic if those processes run automatically. That is why the reform is first an infrastructure question and only then a distribution question.

Capacity

Work on the existing book is a volume problem on top of that. Every old contract is an individual case, and individual cases multiplied by millions produce a task that can only be solved in a standardised way: analysis, comparison, documentation and transfer have to take the same route so that throughput does not hang on manual effort. The Xaver platform is designed for tens of thousands of advice sessions and transfers a month; that is a statement about the capacity of the process, not about today's volumes.

What stays open

• Outstanding statutory instruments under the AltZertG, they concern details of certification and product information.
• The sponsorship of the Standarddepot and how the product information body will work.
• A supervisory statement addressing the Altersvorsorgedepot explicitly is still to come.
• The new maximum deductible amount is currently reported inconsistently; we deliberately quote no figure here until it has been verified against the statute.

For external communication that produces a simple rule: mark what is statute, and mark what is interpretation. The reform has enough solid substance to work with; it does not need figures nobody has verified yet.