# 3rd pillar investment solution from VIAC
**URL:** https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545
**Category:** Banks, Insurances & Third Pillar
**Created:** [November 22, 2017, 4:34pm UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545 "2017-11-22T16:34:38Z")
**Posts on this page:** 20
**Page:** 29
### Author:  [@oluwan](https://forum.mustachianpost.com/u/oluwan)
#### Post date: [October 29, 2020, 6:45am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/618 "2020-10-29T06:45:17Z")
Given the risks and amounts, involved I can’t imagine it costing more than a few franks per account (1M lump sum death insurance is on the order of 300-1000 Fr/y depending on demographic). That’s how cheap they are. And that’s fully loaded cost with profit margins and admin for an external insurance. Self insured with large risk pool will be cheaper
Yes, it’s pretty much just cheap PR around a worthless insurance
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### Author:  [@mabi](https://forum.mustachianpost.com/u/mabi)
#### Post date: [October 29, 2020, 6:46am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/619 "2020-10-29T06:46:57Z")
> [@Thaek](#):
>
> Just received this. To be honest - I don’t like it. Instead of wasting money and resources on integrating Insurance stuff that I don’t want I would have preferred for them to just lower the TER. It seams lowering costs is not their goal. Therefore I will probably switch everything to Finpension soon.
I second you on that. I read this mail from VIAC on the toilets this morning and I thought I was reading spam, right timing for a dump!
Who knows probably there is another company behind which VIAC indirectly benefits from by doing that… Another reason why I hate insurances…
So VIAC, please listen to your customers, lower the TER and stop the marketing BS. Cheers!
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### Author:  [@Cortana](https://forum.mustachianpost.com/u/Cortana)
#### Post date: [October 29, 2020, 6:51am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/620 "2020-10-29T06:51:53Z")
I just tried to do the math. 1% of the population will die between 20-65. Roughly 4-5% of the population will get disabled in this time. So we can assume that Viac will have to add 25% for 5-6% of all the customers they’ll have.
Either I’m doing somewthing wrong or this translates to additional costs of 1.25-1.50%/year?
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### Author:  [@oluwan](https://forum.mustachianpost.com/u/oluwan)
#### Post date: [October 29, 2020, 6:54am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/621 "2020-10-29T06:54:46Z")
You’re assuming they will carry on this insurance forever which they probably won’t and don’t have any obligation to.
Much more likely scenario is they will get run into ground by a competitor in a few years, long before their young demographic reaches an age of sky rocketing mortality. Or the insurance will be forgotten, silently dropped in some subsequent AGB change, but the PR they are getting for it is _now_
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### Author:  [@wapiti](https://forum.mustachianpost.com/u/wapiti)
#### Post date: [October 29, 2020, 7:52am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/622 "2020-10-29T07:52:00Z")
Viac has 600 million under management. 600M AUM x 0.005 = 3 millions. Assuming a 30% margin, it’s 900’000’000 CHF. They can cost cut, they manage more money than Finpension.
> For the base protection you have the possibility **to switch between** the risk of disability and the risk protection in case of death.
It seems to be either death or disability, not both. Also, there are different levels of disability. I would assume it’s only with 100% disability. Nothing yet on the web interface, but I would assume a premium option will be available, so VIAC will be able to increase their revenue @Cortana
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### Author:  [@Cortana](https://forum.mustachianpost.com/u/Cortana)
#### Post date: [October 29, 2020, 8:01am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/623 "2020-10-29T08:01:51Z")
You are right. They only need to pay it out once, so I overestimated the cost by a factor of 20-40. So it will probably be around 0.03-0.075%/year.
They could have reduced the TER to 0.45% instead of adding a useless insurance.
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### Author:  [@OogieBoogie](https://forum.mustachianpost.com/u/OogieBoogie)
#### Post date: [October 29, 2020, 8:09am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/625 "2020-10-29T08:09:44Z")
Interesting all this critical comments from most non-entrepreneur individuals, to explain how entrepreneur should make their business, by cutting their revenue (TER)? Most here are kind of frugal and with VIAC, so they do more right then wrong.
Insurance business (if not core-business) is a kickback business, so they expand probably a new revenue stream with a partner.
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### Author:  [@Cortana](https://forum.mustachianpost.com/u/Cortana)
#### Post date: [October 29, 2020, 8:10am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/626 "2020-10-29T08:10:44Z")
I hope I can opt out of this and get a 0.05% TER reduction.
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### Author:  [@Leap](https://forum.mustachianpost.com/u/Leap)
#### Post date: [October 29, 2020, 8:11am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/627 "2020-10-29T08:11:52Z")
lol you wish… Pretty sure thats not how it works
I agree with @OogieBoogie, the suggestions here are grossly simplified.
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### Author:  [@wapiti](https://forum.mustachianpost.com/u/wapiti)
#### Post date: [October 29, 2020, 8:15am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/628 "2020-10-29T08:15:30Z")
> [@OogieBoogie](#):
>
> Insurance business (if not core-business) is a kickback business, so they expand probably a new revenue stream with a partner
On the business side and to grow their revenue, it makes sense to offer insurance. For the customer, it’s better to cut TER
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### Author:  [@Neville](https://forum.mustachianpost.com/u/Neville)
#### Post date: [October 29, 2020, 8:20am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/629 "2020-10-29T08:20:52Z")
> [@OogieBoogie](#):
>
> Interesting all this critical comments from most non-entrepreneur individuals, to explain how entrepreneur should make their business
We are the customers. A company that doesn’t bother about what their customer-base wants won’t be around for long.
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### Author:  [@wapiti](https://forum.mustachianpost.com/u/wapiti)
#### Post date: [October 29, 2020, 8:24am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/630 "2020-10-29T08:24:59Z")
> In the event of disability or death, you now receive up to 25% in addition to your pension assets. For every CHF 10’000 of assets invested in securities (calculated on the basis of the previous month), VIAC will provide you with free insurance coverage of CHF 2’500 (max. CHF 100’000) in the event of death or disability (70% – degree of disability).
>
> This coverage is paid to you or your beneficiaries in the event of a claim in addition to your VIAC 3a retirement assets.
So it’s either disability at least 70% or death.
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### Author:  [@Leap](https://forum.mustachianpost.com/u/Leap)
#### Post date: [October 29, 2020, 8:25am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/631 "2020-10-29T08:25:56Z")
I agree with you, but they’re literally giving something away for free… I dont feel not cared about. Ofcourse lower TER would be amazing
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### Author:  [@Cortana](https://forum.mustachianpost.com/u/Cortana)
#### Post date: [October 29, 2020, 8:26am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/632 "2020-10-29T08:26:29Z")
Not limited to 10k, it’s just 25%. So 2.5k for every 10k.
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### Author:  [@wapiti](https://forum.mustachianpost.com/u/wapiti)
#### Post date: [October 29, 2020, 8:29am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/633 "2020-10-29T08:29:04Z")
Right, sorry
> [@Leap](#):
>
> I agree with you, but they’re literally giving something away for free… I dont feel not cared about. Ofcourse lower TER would be amazing
Maybe, this is also due to the pressure from Frankly (TER: 0.47) and Finpension (TER: 0,39 + VAT, so 0,42%)
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### Author:  [@dbu](https://forum.mustachianpost.com/u/dbu)
#### Post date: [October 29, 2020, 8:55am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/634 "2020-10-29T08:55:47Z")
> [@Thaek](#):
>
> In case anyone still needs a referal: code
> [@Cortana](#):
>
> In case anyone needs a referral code: code
> [@Neville](#):
>
> code
> [@Cortana](#):
>
> Code: code
> [@oluwan](#):
>
> code
You guys are hilarious.
Talking about useless features and switching, and then offering others to join them. 🤣
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### Author:  [@yetanothername](https://forum.mustachianpost.com/u/yetanothername)
#### Post date: [October 29, 2020, 8:56am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/635 "2020-10-29T08:56:04Z")
From a business perspective: they chose not to compete on price.
I don’t think that it is necessarily stupid.
Speaking from the experience of a small business owner:
if you look at it from their side, there will always be someone who can offer it cheaper. As a small company you can only go so low with the price until you stop bothering about offering the product at all.
Better to address people who care about more than the price.
By adding features they make themselves less comparable.
People on this forum here will of course switch to a even slightly financially better offer but I suppose that for the majority of their existing clients it will probably make it more likely that they will stay.
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### Author:  [@xorfish](https://forum.mustachianpost.com/u/xorfish)
#### Post date: [October 29, 2020, 8:59am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/636 "2020-10-29T08:59:26Z")
It should be more in the range of 1/45\*5-6%\*25% = 3 basis points. The average risk per year is important.
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### Author:  [@Julianek](https://forum.mustachianpost.com/u/Julianek)
#### Post date: [October 29, 2020, 9:01am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/637 "2020-10-29T09:01:18Z")
I think Viac is realizing that their core business is really a commodity business.
If the value proposition is to provide low fees outsourced ETFs for a 3a pillar with a cool App/Website, your only differentiating point is how low your TER is.
Therefore it is only a matter of time until a competitor with enough firepower comes into the market with another solution/app/website with an even lower TER, and this is what we are seing with Frankly/Finpension.
The rule of the game in this paradigm is to get enough AUM to be able to charge a low enough TER so you are profitable at this level but your competitors are not, like what Vanguard and Blackrock are doing.
This is a winner-take-all paradigm which is especially enforced if it is easy for customers to switch from one provide to another.
In the long term, i could even imagine one of the legacy big players offering a ridiculously low TER where nobody is profitable (but which is subsidized by their main operations) so they can get all the market to themselves and weed out small players.
So yeah, i guess VIAC realized they are fighting an arms race to the bottom… in this situation, either they change their offering (not easy, see below), or they stay in a commodity business and their only hope is that all their competitors screw up…
A new player who don’t want to play by the rules and be more profitable has only hard choices:
- either sell a crappy product (3a life insurance anyone?)
- or they need to differentiate themselves by insourcing the asset management and hire an outstanding manager (which is rare, expensive and needs a ridiculously long track record)
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### Author:  [@Thaek](https://forum.mustachianpost.com/u/Thaek)
#### Post date: [October 29, 2020, 9:16am UTC](https://forum.mustachianpost.com/t/3rd-pillar-investment-solution-from-viac/545/638 "2020-10-29T09:16:31Z")
> [@OogieBoogie](#):
>
> Interesting all this critical comments from most non-entrepreneur individuals, to explain how entrepreneur should make their business, by cutting their revenue (TER)? Most here are kind of frugal and with VIAC, so they do more right then wrong.
I think many of us were waiting for the response from Viac before deciding to swich to Finpension. I see the response and I’m not happy with it. Therefore I will switch. Finpension is using the same Credit Suisse funds. And if I compare them it looks something like:
Viac Pros:
- Minimal Disability/Death Insurance for free
- Minmally longer track record
Finpension pros:
- 0.05% FX Fee instead of 0.75% on Viac
- TER 0.42 (incl. VAT) instead of 0.51% on VIAC
- 99% invested instead of 97%
- More flexibility in terms of fund allocation
- Schwyz domiciled (might become important if you leave country)
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