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Do you understand your insurance certificate?

It’s that time of year again: your annual insurance certificate will be in the mail. Be honest, do you take a really close look at it? Or do you just file it away without a second glance? We want to explain why it’s worth taking a closer look at your certificate and what you can learn about your future benefits from the figures it contains.

25 march 2020, text: Mirjam Arnold, photo: Helvetia

A man takes a critical look at his mail.
The insurance certificate not only shows you the current amount of your pension fund assets, it also includes other key figures to help you plan your retirement.

Low interest rates and high life expectancy mean lower investment returns and thus more modest pensions. That’s why it’s increasingly important to regularly review the provisions you make for your retirement. You can get a clearer picture of your retirement assets once you have reached your mid-50s. But it is never too early to start planning in detail for your retirement.

Your retirement savings 'account statement'

The insurance certificate provides information on all the benefits you are entitled to under your occupational benefit scheme. Here are brief explanations of five of the key figures:

Annual salary and retirement savings

The first amounts shown in the insurance certificate are your reported and insured annual salary. You can also see the retirement savings you had accumulated as of the end of the previous year.

Retirement benefits

Your income serves as a basis for extrapolating your pension fund capital and thus your potential pension. You can also see how early or delayed retirement would affect your finances in retirement.

Risk benefits (disability and death)

The insurance certificate also shows you the amount of your potential disability pension (if you fall ill or have an accident) and how high the annual spouse’s or partner’s pension would be should you die. The certificate also lists the amount of the annual orphan’s pension.

Maximum purchase sum under the insurance provisions

This is the maximum additional amount you can pay into the pension fund. By paying in more, you can increase not only your retirement savings and thus your retirement pension, but also your risk benefits. Additional purchases are also tax deductible.

Purchase or amortization of owner-occupied residential property

There are only few options to withdraw money from your pension fund in advance. One of these is when you invest in owner-occupied residential property. The amount withdrawn is noted in the insurance certificate. Withdrawals are subject to a minimum amount, while other restrictions apply as of age 50. If you are interested in making a withdrawal, we recommend an individual consultation. Please note that early withdrawals deplete the amount of savings available to you later on and reduce your benefits in the event of social hardship.

For further details about the information and figures shown in your insurance certificate, please see our information sheet.

 

A lot can still change

Always remember that the figures in your insurance certificate are estimates. As they are based on your current income, they will change before you retire. As a rule, the closer you are to retirement, the more accurate the figures are. But the interest and conversion rates can also trigger changes. Your personal circumstances can also have an impact on your retirement benefits, e.g. if you make an early withdrawal to finance residential property, make additional purchases to increase your retirement benefits, or if those benefits have to be divided up following a divorce.

Identifying and closing gaps

With OASI and IV (1st pillar), occupational benefits (2nd pillar) and private pension provision (3rd pillar), it is possible to get early estimates of your retirement benefits. If the estimated amounts are too low, you have different options to increase them. To this end, we recommend you book an individual consultation with our pension experts. After all, what financial means you really have at your disposal when you retire depends not only on the benefits you receive from all three pillars, but also on your own personal circumstances and assets.

Occupational benefits for employees – information and tools

You will find information on all key aspects of occupational benefit schemes here.

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