National Insurance Underreports Investment Gains for Israeli Children's Savings Program
Translated & summarized from Globes by baba
The story in 6 lines · by baba
- National Insurance reported 3.25 billion shekels profits from investment houses, but actual profits are about 7.25 billion shekels.
- Altshuler Shaham, managing 40% of funds, was reported to have only 80 million shekels profit, but real returns were much higher.
- Altshuler Shaham's assets in the program were 12 billion shekels, not 8 billion as per National Insurance data.
- Harel also showed underreported deposits and profits by about 1 billion shekels.
- Total profits for children in the program, including banks, are estimated at 7.85 billion shekels since 2017.
- National Insurance has not yet commented on the discrepancies found.
Israel's National Insurance Institute recently published data on the profits generated for children under the "Savings for Every Child" program, which began in 2017 and runs through 2025. According to their report, 14.1 billion shekels were deposited into provident funds and 3.5 billion shekels into banks by the National Insurance, with parents contributing an additional 6.1 billion shekels to provident funds and 1.6 billion shekels to banks. The program allows children to save long-term without management fees until age 18, with the option to continue saving afterward.
The National Insurance claimed children earned 3.85 billion shekels in profits, including 3.25 billion shekels from investment houses. However, this figure was found to be inaccurate. Specifically, the report stated that Altshuler Shaham, the largest investment house in the program holding about 7.9 billion shekels (40% of total deposits), generated only 80 million shekels in profits, implying a mere 1% return. This contradicts actual returns, which were much higher: 70% in the high-risk track, 41% in medium risk, and 27% in low risk over the last three years ending December 2025.
Further analysis showed that Altshuler Shaham's asset balance in the program was 12 billion shekels by the end of 2025, not the 8 billion shekels suggested by National Insurance data. The corrected profit for Altshuler Shaham savers is estimated at nearly 4.1 billion shekels. Similar discrepancies were found with Harel, the second-largest manager, where reported deposits and returns were understated by about 1 billion shekels.
Overall, the actual profits for children in investment houses are closer to 7.25 billion shekels, not 3.25 billion, and including banks, total profits since the program's inception likely amount to 7.85 billion shekels. National Insurance has not yet responded to these findings.
Summary: Israel's National Insurance Institute underestimated the investment returns for children in its savings program, with actual profits nearly double the reported amount, especially in major investment houses Altshuler Shaham and Harel.
