Situation and possibilities of improvement of voluntary pension insurance in Serbia as a developing country

Like many other countries, Serbia, too, has faced the necessity of introducing changes into the voluntary pension insurance. However, reforms of pension insurance in Serbia started with significant delay in comparison with almost all other countries of Eastern Europe. The key reasons for this were disintegration of previous state followed by several wars during the 1990s, the UN sanctions, and hyperinflation. All these brought the country's economy to the verge of collapse. The Serbian insurance companies introduced voluntary pension insurance in 2002. A special law that exclusively arranges voluntary pension insurance was passed in 2005. The last five years gave us the opportunity to evaluate the performance of voluntary pension fund management companies, and this is done in this paper primarily through researches of trends of the value of the voluntary pension funds investment units. As the value of investment unit in domestic currency, dinar, does not reflect a real picture, this paper presents the calculation of the value for this indicator in euros, and in constant prices in dinars. A general conclusion is that in Serbia there is a tendency towards decreasing the real value of investment units, which has not been a stimulus both for the current and possible insureds. The paper also provides suggestions for improvement of voluntary pension system in Serbia.