Just 20 per cent of European Union (EU) consumers are members of an occupational pension scheme, according to the European Insurance and Occupational Pensions Authority’s (EIOPA) 2024 Consumer Trends Report.

One of the report’s key areas of focus was the analysis of consumer appetite for supplementary pensions to bridge the pension gap caused by low occupational pension coverage. Currently, just 18 per cent of EU consumers own a personal pension product, according to EIOPA’s Eurobarometer.

These figures align with the fact that just 42 per cent of those surveyed are confident that they will have enough money to live on in retirement.

EIOPA stressed that pension participation is particularly low among women. The number of women who participate in an occupational pension or own a personal pension is five basis points and six basis points lower than for men. Ultimately, women feel more negatively than men about their retirement outlook, 47 per cent for women, against 37 per cent for men.

EIOPA found that lack of financial resources, high costs and the perceived complexity of some products are the main reasons for the low uptake of personal pensions across all consumers.

While almost half of EU citizens agree that personal pension products offer value for money, high costs remain the main reason for 19 per cent of EU consumers, who indicated why they did not buy or renew a personal pension product over the past two years.

However, this figure varies across EU countries, ranging from 38 per cent of consumers in Greece and 25 per cent in France and Austria, to 10 per cent in Finland, 11 per cent in Sweden and 12 per cent in the Netherlands.

“This is in line with EIOPA’s findings from previous costs and past performance reports where it clearly emerged that Sweden is amongst the market with consistently lower costs. This trend may also reflect differences in how consumers in these countries evaluate the cost-benefit ratio of pension products,” the report said.

In addition, the report noted that good governance of pension funds is recognised as a key factor in ensuring good outcomes for members and beneficiaries with” overall sound practices being observed across the EU”.

Some digital tools have also appeared in the pensions sector with an increasing number of savers and beneficiaries accessing and receiving information online. EU consumers reported using various channels to communicate about their pension benefits, such as in-person communication (43 per cent) and paper-based communication (14 per cent), but also via email (44 per cent) and via smartphone applications (18 per cent). However, older consumers (55+) reported preferring in-person communication.

“This split may be explained by consumers’ digital skills but also by the complexity of the information provided, and the fact that it is sometimes less easy for consumers to understand their supplementary pension in the absence of a contact point. Moreover, only 55 per cent of EU consumers find that it is easy for them to understand their pension products/schemes and their overall pension benefits,” the report found.

Commenting, EIOPA chair, Petra Hielkema said: “Over the past years, policymakers, regulators and industry have made efforts to ensure that consumers receive valuable, well-designed and suitable insurance and pensions products and services.

“We are beginning to see improvements in areas needed; however, concerns remain and addressing them has become even more important in light of the effort to move towards a Savings and Investments Union.”

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