Mechanisms for corporate pension programs realization
Under the RF legislation only two types of institutions are authorized to realize corporate pension programs:
Insurance companies.
Non-state pension funds.
Insurance companies realize the corporate pension programs within the framework of collective pension insurance:
In this case employers are insurers and employees – insured persons. The insurance agreement prescribes the terms and rates of pension contributions (insurance premium) and pension payments.
Insurance premiums paid by the employer for each insured person are accrued forming a pension reserve with investment returns.
Having reached the retirement age employees start receiving payments constituting a significant addition to the pension paid by the government.
Non-state pension funds realize the corporate pension programs within the framework of retirement insurance agreements concluded between the Fund and the contributing organization:
Employer are depositors making contributions to the pension fund for employees - Participants. The retirement insurance agreement prescribes the rate and order of contribution amount payment.
All the amounts contributed to the pension fund are entered to the joint (for all Participants) or special (individual for each Participant) account of the Depositor thus forming pension reserves bringing investment returns.
The rate of non-state pension and the order of its payment is determined for each employee based on the accrued amount upon reaching by him of the retirement age.
