Management Consulting

The case study highlights the challenges faced by businesses in Cyprus regarding employee retention and engagement, particularly in the context of recent pension system reforms that have significantly reduced the replacement rate for pensions. This situation has created a pressing need for companies to enhance their employee benefits to attract and retain skilled personnel while also addressing the financial security concerns of their workforce. To tackle these issues, Aon provided tailored solutions through the implementation of Group Insurance Programs and the establishment of Professional Insurance Funds. The Group Insurance Programs were designed to meet the specific needs of businesses, allowing them to enhance their employer profile while providing employees with supplementary income during retirement. This approach not only improved employee morale but also ensured that contributions were treated as business expenses, thus exempting them from income tax for employees until benefits were received. Additionally, Aon assisted in creating Professional Insurance Funds, which offer insurance protection beyond mandatory social security, addressing the needs of aging and health for insured individuals and their beneficiaries. These funds are established on a voluntary basis and require participation from at least 100 members, providing significant tax benefits for both employees and employers. The MAP Fund (Multiemployer Aon Provident Fund), launched in October 2014, serves as a pioneering solution in the Eastern Mediterranean region, allowing employers and employees to participate in a comprehensive retirement solution with optimal management and investment strategies. The quantifiable benefits of these initiatives include reduced investment costs, optimized risk-return-cost balance, and real-time information for employers. Furthermore, employees enjoy tax advantages under the Greek IORP regulations, along with the flexibility to choose their investment strategies. Aon’s extensive experience in managing $3.3 trillion in assets and its commitment to providing innovative retirement solutions have positioned it as a trusted partner for businesses in Cyprus seeking to enhance their employee benefits and ensure long-term financial security for their workforce.