FAQ

What does being insured by the Pension Fund Swiss Re mean?

It means that the Swiss Re pension scheme pays you and / or beneficiaries (for example, spouse or partner and children) benefits if you experience a loss of financial income because you retire, become disabled, or die.

What kind of plan does the Pension Fund Swiss Re offer?

The Pension Fund Swiss Re consists of

  • the Pension Pan and
  • the Capital Plan.

You may also supplement an ER account through voluntary buy-ins. Using this ER account, the retirement pension could be increased in the event of voluntary early retirement and/or a supplementary pension could be financed up to age 65.

Why two Plans?

The Pension Fund Swiss Re offers two plans to:

  • provide you with wide insurance coverage;
  • mirror the compensation system on which benefits are based. The Pension Plan covers your fixed salary and the Capital Plan benefits are linked to the bonus amount you actually receive from Swiss Re;
  • give you the opportunity to decide in which plan you wish to make extra payments to buy additional benefits.

When does your insurance coverage begin?

Generally, when you begin working at Swiss Re.
You have risk insurance cover under the Pension Plan as of 1 January following your 17th birthday, provided you earn an annual salary of at least CHF 21 330.
You are fully insured under the Pension Plan as of 1 January following your 24th birthday.

When does your insurance coverage end?

  • Under the Pension Plan, when you stop working at Swiss Re for any reason other than retirement, disability or death.
  • Under the Capital Plan, when your accrued savings capital becomes payable, which is generally when you stop working at Swiss Re.
  • If you end your employment with Swiss Re, the insurance coverage provided under the Pension Plan for disability and for death will continue until you join your new employer's pension fund, or for one month after you stopped working for Swiss Re, whichever comes first.

What happens when you join the Pension Fund Swiss Re?

  • Any leaving benefit paid by a former employer's pension scheme must be transferred to the Pension Fund Swiss Re. This amount is invested in the Pension Plan.
  • If you do not transfer any leaving benefit at the start of your participation in the Pension Fund, or if the amount of your leaving benefit is less than the highest amount you can contribute to the Pension Fund, you can at any time until the age of 65 make extra payments to the Pension Plan to buy the maximum benefits possible.
  • If the entry contribution exceeds the maximum possible buy-in amount in the Pension Plan, you can decide whether we should credit the remaining amount to the ER account or the Capital Plan as a buy-in or whether you would like to open a vested benefits account.

What happens when you leave the Pension Fund Swiss Re?

In most cases, the total amount of your Pension Fund Swiss Re leaving benefit (from the Pension Plan and the Capital Plan) is transferred to your new employer's pension scheme.
If you end your employment with Swiss Re, the insurance coverage provided by this pension scheme for disability and for death will continue until you join your new employer's pension fund, or for one month after you stopped working for Swiss Re, whichever comes first.

How do lump-sum withdrawals upon retirement affect the amount of retirement benefits?

Lump-sum withdrawals upon retirement reduce the retirement savings capital. The amount of the pension is determined through this equation:

Retirement savings capital in the Pension Plan * conversion rate = annual retirement pension.

Each lump-sum withdrawal therefore reduces the retirement pension. The higher the amount of the lump-sum withdrawal, and the smaller the amount of the remaining retirement savings capital, the greater the reduction of the retirement pension.

What is a conversion rate?

The conversion rate is the percentage used to convert the retirement savings capital in the Pension Plan into an annual retirement pension at the time of retirement.

Example: year of birth 1954, age 65, survivors' benefits corresponding to the statutory minimum benefits under the FSOPP, retirement savings capital of CHF 500 000 in the Pension Plan, conversion rate of 4.93%. The annual retirement pension will accordingly be 4.93% of CHF 500 000, which comes to CHF 24 650.

Why does the Pension Fund Swiss Re use conversion rates based on the year of birth?

The statistically calculated life expectancy has a major impact on the conversion rate. Because the Pension Fund Swiss Re uses generation tables, younger insureds are subject to lower conversion rates than older insureds. The Pension Fund Swiss Re thereby also takes account of increasing life expectancy in the future.

Is the same conversion rate applied for men and women?

The Pension Fund Swiss Re does not distinguish between the genders. To take account of the differing lifestyles among insureds, the Pension Fund Swiss Re has now introduced conversion rates that vary according to the amount of the selected survivors' benefits. The higher the amount of the survivors' benefits, the lower the conversion rate and thus the amount of the retirement pension.

What is the difference between a periodic table and a generation table?

Mortality tables show information on how many people from a large group die for each year of age. They allow the life expectancies of a new-born child and of a person of a specific age to be calculated statistically.

When calculating a conversion rate, the life expectancy of a 65-year-old is key, and two different approaches can be taken here: periodic tables and generation tables.

  • Periodic table

A periodic table provides a snapshot. The average life expectancy of a 10-year-old child is measured for the same period as that of a 65-year-old. However, in 55 years, when the 10-year-old child is 65 years old, they will most likely have a higher life expectancy than a 65-year-old would have today.

  • Generation table

A generation table takes into account increasing life expectancy, even after retirement. Experts find this to be a more reliable basis for calculation. Generation tables show people as living for longer than periodic tables do. This is because the increasing life expectancy has already been taken into account. This distinction is important when determining the conversion rate: A life expectancy that is too low will lead to the pensioner receiving an annual pension that is too high. The money that they saved for their own pension during their working life will not be enough to last until the end of their life. However, pensions are guaranteed until death. Therefore, the missing capital must be generated through the capital market or must be cross-financed through active insureds. This redistribution, which goes against the system, is happening today but the use of generation tables means that it is being significantly reduced. The Pension Fund Swiss Re has been applying generation tables since 1 January 2015.

What is meant by the term "technical bases"?

Pension fund obligations are calculated on the basis of biometric elements, such as the probability of dying, becoming disabled or getting married. These probabilities are obtained using statistics that are generated over several years on the basis of observations of large numbers of insureds. The compiling of all probabilities and the resulting cash equivalents when calculating pension obligations is referred to as "technical bases".

Why do the technical bases change?

Since the probability of dying or becoming disabled, for example, is not constant but is subject to change, the technical bases must be regularly updated. The continuous increase in life expectancy over recent decades is a well-known example of this. A change in statutory provisions and economic circumstances may also affect the likelihood of becoming disabled.

In accordance with the FSOPP (Swiss Federal Law on Occupational Retirement, Survivors' and Disability Pension Plans), a conversion rate of 6.80% applies. Why does the Pension Fund Swiss Re still only pay, for example, 4.55% (option 1) for those born in 1954 and aged 65?

The conversion rate of 6.80% applies only to the statutory minimum benefit within the framework of the FSOPP mandatory scheme (see "FSOPP retirement savings" on your pension benefits statement). The Pension Fund Swiss Re offers significantly higher, "enveloping" benefits. As long as the statutory minimum benefits under FSOPP are met, the Pension Fund may determine lower conversion rates for the entire retirement savings.

The Pension Fund Board of the Pension Fund Swiss Re sets the conversion rate for the extra-mandatory portion, using the long-term interest rate environment and the life expectancy as a basis. This results in a mixed rate, which ensures that statutory provisions are met at all times.

Compliance with the minimum benefits is guaranteed for each and every insured.

Do the options for designing survivors' benefits for spouses also apply for cohabiting partners? If so, what do insureds need to do in this case, and what are the applicable deadlines?

The options for designing survivors' benefits for spouses also apply for cohabiting partners. By two months before retirement at the latest, insureds must communicate their desired option in writing to the Pension Fund Swiss Re. For married insureds, it is also necessary to have written consent from the spouse, with the spouse's signature being notarised. The spouse may also personally submit the signature by appearing at the offices of the Pension Fund Swiss Re and presenting an identity document. This requirement does not apply for cohabiting partners.

If the insured does not communicate a desired option, the conversion rate with a spouse's pension of 60% of the retirement pension will be applied.

Available options:

Option 1: Spouse's pension of 60% of the retirement pension

Option 2: Spouse's pension of 100% of the retirement pension

Option 3: Spouse's pension corresponding to the statutory minimum benefits under the FSOPP

Registered partnerships are treated in the same way as marriages.

Are buy-ins for the financing of voluntary early retirement or a supplementary pension tax-deductible?

All buy-ins to the Pension Fund Swiss Re, ie buy-ins to the Pension Plan, the Capital Plan or the ER account (pre-financing of early retirement) for the pre-financing of voluntary early retirement or a supplementary pension can be claimed as a reduction of income for tax purposes.

Three important points should be noted:

a)      Three-year period: If the last buy-in occurs within three years before a lump-sum withdrawal, the tax authorities will adjust the tax assessment by the amount of the buy-in and the insured will have to pay supplementary taxes (including default interest).

b)      Moving to Switzerland from abroad: Insureds who have never been insured by a Swiss pension fund and who have moved to Switzerland from abroad within the last five years may only make buy-ins equal to an annual maximum of 20% of their insured salary (according to the pension benefits statement).

c)      Buy-ins by an insured for voluntary early retirement can only be credited to the ER account if the retirement savings capital in the Pension Plan has reached the specified maximum amount. In the case of insureds who do not take voluntary early retirement despite having bought into the ER account, and whose benefits, upon immediate retirement, exceed 105% of the model-based benefits target, with a full term of insurance* and at the normal retirement age, the retirement savings capital of these insureds will no longer accrue interest. Furthermore, no more retirement credits will be granted, and no more savings contributions collected.
* Retirement pension corresponds to 60% of the last insured salary

How else can you use your Pension Fund benefits?

Under certain circumstances, you can use some or all of your accrued pension fund benefits (from the Pension Plan and the Capital Plan) to buy a home.
If you get divorced while participating in the Pension Fund, half of your accrued benefits (in the Pension Plan and the Capital Plan) will be paid to your ex-spouse.

What are your rights?

In addition to the benefits described, you have the right to receive information regarding the organisation and investment performance of the Pension Fund Swiss Re. However, you do not have the right to receive any personal information about other pension scheme participants. Each year, you will receive a personalised pension statement. If you do not automatically receive the information you require, you can ask the Pension Fund team or a member of the Pension Fund Board to forward it to you.

What are your duties?

You are required to provide all the necessary information regarding insurance to the Pension Fund Swiss Re, including:

  • The leaving benefit paid by your former employer's pension scheme;
  • Changes in income and changes in health if you are on sick leave due to being disabled;
  • Changes in your martial or family status.

How is the Pension Fund Swiss Re administered?

The Pension Fund is managed by a foundation which falls under the supervision of the Canton of Zurich. As a foundation, the Pension Fund Swiss Re is legally independent.
The foundation is managed by a Pension Fund Board whose members are personally responsible for all the foundation's activities. The Pension Fund Board delegates special tasks, such as management and the investment of capital, to specially designated persons.

What can you do if you do not agree with a decision of the Pension Fund Board?

If you disagree with a decision, you can take the following legal steps:

  1. Indicate your objection to the Pension Fund Swiss Re management;
  2. Appeal to the Pension Fund Board;
  3. Take ordinary legal action by making a claim to the Cantonal Insurance Tribunal in Zurich, which is normally free of charge and requires no lawyer.

If necessary, you can contact the Supervisory Authority of Zurich to act as your mediator.

We are is available to answer any questions you may have.