See accounting policy G.

The costs of the post-employment benefits pensions relate to the current DC pension plan of a.s.r., the previous DB plans of a.s.r. and Aegon NL, plus the DC plans of the other group companies.

An amount of € 5.018 million (2022: € 2,609 million) of the employee benefits is expected to be settled more than twelve months after the balance sheet date.

7.5.15.1 Post-employment benefits pensions

a.s.r. has a number of DC and DB post-employment benefit plans for its employees and former employees. The majority of employees are formally employed by a.s.r. A limited number of employees are employed by other group companies. The pension plans of other group companies are disclosed in a separate section in this chapter.

a.s.r. life and Aegon life, insurance companies and group entities, are the insurers of the majority of the post-employment defined benefit plans. a.s.r. life is also the insurer of the current DC pension plans. As a.s.r. life and Aegon life hold the investments that are meant to cover the employee benefit obligation for the DB plans, they do not qualify as plan assets in accordance with IAS 19 and are therefore included in financial assets.

a.s.r. employees

All pension buildup for existing and new employees as of 1 January 2021 are included in the post employment DC plans. All employees who commenced service between 1 January 2006 and 31 December 2020 are included in one post-employment DB plan (‘Basic plan’). All other employees remain active within the existing plan at the date of first employment. Previous plans for former employees are also still active.

The recognised expenses for the DC plan in 2023 amounts to € 44 million (2022 € 37 million), which includes the employees of Aegon NL that transferred to a.s.r. resulting from the acquisition on 4 July 2023.

The DC plan has two components with defined benefit elements with a marginal impact; survivors' pension and the option to buy a guaranteed income. Both components are accounted for in the same way as the DC plan.

The past service cost of € -7 million pre-tax presented in 2023 mainly relates to the RVU obligation in relation to the Aegon NL employees that entered the employment of a.s.r. The past service cost of € 1 million pre-tax presented in 2022 relates to developments in relation to the ended DB plan (ended 31 December 2020) of a.s.r.

The post-employment DB en DC plans for employees that are employed by a.s.r. are insured by a.s.r. life or Aegon life.

The methods and techniques used to calculate the DB obligations are based on IAS 19 requirements and calculated by an independent actuary.

The benefits under these plans are dependent on factors such as years of service and compensation. Pension obligations are determined using mortality tables, the rate of employee turnover, wage drift and economic assumptions for factors such as inflation, and the discount rate.

As per 31 December 2020, the contribution to the DB pension scheme ended, therefore no accrual rate and pensionable salary and minimum franchise is required for this scheme.

• The DB pension scheme had a retirement age of 68 years;

• The DB scheme was based on average-salary pension; and

• Future inflation indexation agreements are inforce.

Former Aegon employees

Former employees of Aegon NL are still covered by a number of Aegon NL post-employment benefit plans. Aegon NL has issued defined contribution plans and defined benefit plans.

The contribution payable to a defined contribution plan for services provided is recognised as an expense in the income statement. An asset (or liability) is recognised to the extent that the contribution paid exceeds (or falls short of) the amount due for services provided. With the integration of Aegon NL and a.s.r. on 1 October 2023, the Aegon DC plan with Aegon IORP became non-contributory; the employees of Aegon NL are being included in the DC plan of a.s.r.

The defined benefit obligation is based on the terms and conditions of the plan applicable on the balance sheet date. In measuring the defined benefit obligation Aegon NL uses the projected unit credit method and actuarial assumptions that represent the best estimate of future variables. The benefits are discounted using an interest rate based on the internal curve for high quality corporate bonds, that are denominated in the currency in which the benefits will be paid and that have terms to maturity that approximate the terms of the related pension liability. Actuarial assumptions used in the measurement of the liability include the discount rate, estimated future wage inflation, mortality rates and price inflation.

As per 31 December 2019, the contribution to the DB pension scheme ended, therefore no accrual rate and pensionable salary and minimum franchise is required for this scheme.

• The DB pension scheme had a retirement age of 68 years;

• The DB scheme was based on average-salary pension; and

• Future inflation indexation agreements are inforce.

Other group companies employees

The other group companies, which are entities mainly operating in the Distribution and Services segment, have DC plans, insured with a.s.r. life. The recognised expenses for these DC plans in 2023 amounts to € 13 million (2022: € 5 million).

Net defined benefit liability

a.s.r. employees

Employees account for 20% (2022: 20%) of the DB obligation, 52% (2022: 52%) of the DB obligation relates to former employees currently receiving pension benefits, 25% (2022: 25%) of the DB obligation relates to deferred pensioners and 3% (2022: 3%) of the DB obligation relates to other members.

The discount rate was 3.42% at 31 December 2023 (31 December 2022: 3.67%), resulting in a € 81 million increase (2022: € 1,259 million decrease) in the DB obligation.

As per 31 December 2023 the duration of the DB obligation was 14 years (2022: 14 years).

The change in other assumptions amounts is nil (2022: € 31 million) primarily due to a change in indexation percentage of former employees.

Former Aegon employees

The DB obligation of Aegon NL classifies as multiple-employer contract. a.s.r. has an obligation to pay part of the guarantee premium, which is an insurance premium to pay for the guarantee provided by Aegon life. Each year when there is a decision related to additional entitlements stemming from indexation, a new guarantee premium is calculated. This premium is based on the total of entitlements, including the previous annual layers of indexation bought in the past. The indexation annuity, which is based on contractual tariff, is extracted from the indexation depot. The guarantee premium, which is calculated based on the difference between the current market price and the contractual tariff for indexation, is paid in full by a.s.r. to Aegon life, and subsequently 29% thereof is recovered from Aegon Ltd. (2023: € 4 million). These contributions from Aegon Ltd. are set out in the formal terms of the plan, and thus affect remeasurements of the net DB liability. An amount of € 69 million was netted of the DB obligation and included in OCI.

Employees account for 0% of the DB obligation, 54% of the DB obligation relates to former employees currently receiving pension benefits, 44% of the DB obligation relates to deferred pensioners and 2% of the DB obligation relates to other members.

The discount rate was 3.42% at 31 December 2023 (3.81% at acquisition date), resulting in a € 83 million increase in the DB obligation. As per 31 December 2023 the duration of the DB obligation was 14 years. The change in other assumptions amounts to € -6 million primarily due to a change in indexation percentage of former employees.

Experience adjustments

Experience adjustments are actuarial gains and losses that have arisen due to differences between actuarial assumptions. The following table provides information about experience adjustments with respect to qualifying plan assets and the DB obligation:

Assumptions

In the calculation of the DB obligation the:

• Discount rate is based on an internal curve for high quality corporate bonds;

• For the a.s.r. pension scheme the most recent mortality table ‘AG Prognosetafel 2022’ is used, in combination with a.s.r. specific experience factors for the pension portfolio;

• For the Aegon NL pension scheme the Aegon 2023 life tables were used;

• The period of indexation is based on the expected duration of the separate account to fund the future inflation indexation.

The sensitivity of the above actuarial assumptions to feasible possible changes at the reporting date to one of the relevant actuarial assumptions whilst other assumption remain constant, would have affected the DB obligation by the amounts shown below:

Non-qualifying plan assets

The portfolios of global investments related to the ended DB pension schemes of a.s.r. and former Aegon NL are considered non-qualifying plan assets. The non-qualifying assets, which are managed by a group company, are not presented as part of the net DB obligation.

For the non-qualifying assets backing the post-employment benefit plans, a.s.r. has drawn up general guidelines for the asset mix based on criteria such as geographical location and ratings. To ensure the investment guidelines remain in line with the conditions of the post-employment benefit obligations, a.s.r. regularly performs Asset Liability Management (ALM) studies. Transactions in the non-qualifying assets are done within the guidelines. As the post-employment benefit plans are a liability on group level, the underlying insurance and market risks are in scope of a.s.r.’s risk policies (see chapter 7.8).

The overall interest-rate risk of the group is managed using interest-rate swaps and swaptions. a.s.r. manages the interest rate risk through an overlay interest hedging strategy using swaps and swaptions for the company as a whole (see chapter 7.8.3). The swaps and swaptions are not specifically allocated to the respective post-employment benefit plans.

a.s.r. has separate accounts to fund future inflation indexation for the employees and former employees included in the a.s.r. post-employment defined benefit plan. As such this has been included in the DB obligation. The fair value of these assets amounted to € 330 million (2022: € 372 million) for a.s.r. and € 603 million in relation to Aegon NL. The Aegon NL non-qualifying plan assets are ringfenced and amount to € 2,374 million.

7.5.15.2 Post-employment benefits other than pensions

The other post-employment benefits plans consist of personnel arrangements for financial products (such as mortgages and health insurance), which remain in place after retirement.

Experience adjustments are actuarial gains and losses that have arisen due to differences between actuarial assumptions. The following table provides information about experience adjustments with respect to qualifying plan assets and the DB obligation:

In accordance with a.s.r.’s policy, discounts on employee mortgages have been fixed in amounts granted on the reference date December 2017 and for former Aegon NL employees on the reference date January 2023.

In the calculation of the DB obligation the:

• Discount rate is based on an internal curve for high quality corporate bonds;

• For a.s.r. post employment benefit obligations the most recent mortality table ‘AG Prognosetafel 2022’ is used, in combination with a.s.r. specific experience factors for the pension portfolio;

• For former Aegon NL post employment benefit obligations the Aegon 2023 life tables were used.

The sensitivity of the above actuarial assumptions to feasible possible changes at the reporting date to one of the relevant actuarial assumptions whilst other assumption remain constant, would have affected the DB obligation by the amounts of € 1 million increase (2022: € 1 million increase) or € 1 million decrease (2022: € 1 million decrease) as a result of a movement of the discount rate by 1%. Former Aegon NL employees are not included in the comparative figures.

7.5.15.3 Other long-term employee benefits

Other long-term employee benefits consist of the employer’s share of liabilities arising from long-term services, such as jubilee benefits.