Obligatory pension insurance allows guaranteed realization of certain rights of both Russian citizens and foreigners who live in our country. Voluntary pension insurance is an addition to the mandatory insurance due to the lack of effectiveness of the latter to guarantee the material interests of any social groups of the population. What does all this mean? Let's look at this issue in more detail.
Positive aspects of voluntary insurance
If it were absent, then the elderly citizens of our country would have been worse off. The fact is that the majority of state pensions are very small, and it is not possible to live comfortably with such money. Voluntary pension insurance is promising if the size of a citizen's payments to the pension fund is small or in principle absent: if there are no labor incomes, for entrepreneurial activity not officially registered, for gray salaries, etc. What is the essence of this concept? How does it differ from mandatory? This will be discussed later.
Key Definitions
Voluntary legal relations for compulsory pension insurance is a system of accumulation of funds that form the future pension through various financial organizations. It is based on principles that are similar to those used in compulsory insurance. To carry out voluntary insurance, the will of two parties is required. It is based on a contract in accordance with which the procedure and amount of accrual of insurance premiums are not established by the state, but directly by the citizen who is interested in receiving a good pension.
Voluntary pension insurance supplements compulsory insurance. At the same time, various types of insurance and financial organizations accumulate cash. Extrabudgetary funds do not have any relation to the formation of funds. Voluntary insurance is guaranteed to provide a citizen with decent material benefits in old age. Since the pension has a minimum established amount, it becomes impossible for him to have a full life and sufficient satisfaction of his own needs of a citizen of retirement age. Of course, there are exceptions to this rule, but they are rare. Therefore, voluntary insurance was created as an addition to compulsory insurance. With this type of insurance, the insured person is guaranteed worthy benefits in old age, regardless of the size of the labor pension that has been accrued to him.
Insurance experience outside the Russian Federation
The method of combining the two types of insurance is widely used in Britain, Canada, France, Germany and the United States. That is why all the working people of our country dream of a pension for workers in these countries. Thanks to voluntary pension insurance contributions, American and Western European pensioners do not need anything and can afford to travel around the world. This allows each employee to independently choose their own insurer with suitable insurance conditions and tariffs. Voluntary insurance guarantees every citizen in old age economic stability, regardless of the influence of external factors or the state in which the state budget system is located.
Functions of Pension Insurance
Obligatory and voluntary pension insurance perform important functions and allow:
- Allocate funds to pensioners for supplementary pension payments.
- Accumulate pension contributions to the Pension Fund, voluntary insurance has the features of accumulation of funds in NPFs and insurance companies.
- Monitor the full and regular payment of funds to the parties to the agreement.
- Redirect pension savings to other funds at the request of depositors.
The general meaning of pension insurance
Pension funds are accumulated due to contributions made by the insured under a voluntary insurance contract. Based on the contributions paid during a certain period, the formation of the amount of payments occurs if an insured event occurs, that is, the retirement age is reached. This is called an additional pension. The obligation of the insurer is timely and complete control over the fulfillment of obligations by the insured person on payment of contributions.
If the undertaken obligations are not fulfilled, including also non-payment to the citizen of the prescribed savings, liability is provided for in our country. The activities of insurance companies and non-state pension funds for the provision of voluntary pension insurance services in the Russian Federation are very tightly controlled. However, there is no need to be reassured, since there are a large number of fraudulent schemes in the insurance market. That is why, before trusting one's own savings to one or another fund, it is necessary to carefully analyze the information available about it.
Who are the subjects?
For this type of insurance, the following are insurers: non-governmental pension funds (or NPFs), as well as insurance companies. Non-state pension funds are non-profit organizations whose task is to provide voluntary insurance for non-state fund participants. Any natural person can be considered insured if a pension agreement is concluded in his favor. It can also be a member of an NPF, regardless of citizenship. The depositor acts as the insured in such legal relations. It is a person paying insurance premiums either in favor of a pensioner of the fund, or in favor of a participant. Contributors may be:
- an individual (both a citizen of Russia and a foreigner);
- registered in our state or a foreign legal entity;
- The structure of the executive branch.
A pensioner and a participant can be considered such an individual who is a member of several fund organizations at once. However, this rule does not apply to investors.
Features
When concluding an agreement, you must be very careful. Most often, the contract is presented in the form of a standard form, however, if something does not suit the client or some things are incomprehensible to him, it is necessary to clarify all available questions.
The voluntary pension insurance contract always clearly spells out the recognized insured event - this is the achievement of the retirement age by the insured person. In addition, the frequency and size of the deposited funds are stipulated. Most often, the down payment ranges from nine to twenty-five thousand rubles. After that, the payment can vary from two hundred to a thousand rubles per month. Some programs make it possible to make quarterly payments, that is, once every six months or a year.
Another important detail is the possibility of drawing up such a contract not only for oneself, but also for another person, whether it is a familiar citizen or his relative. Thus, upon the occurrence of an insured event, the person specified in the agreement will receive an increase in pension.
Is suspension of the agreement possible?
A voluntary pension insurance contract is terminated if the following situations occur:
- the fulfillment of the conditions specified in the agreement ends;
- the insured person dies;
- liquidates a legal entity that is a depositor in corporate type insurance;
- in the event of unforeseen circumstances specified in the agreement;
- upon termination unilaterally, if the customer ceases to pay insurance premiums;
- by agreement of the parties;
- in a judicial proceeding, if the fulfillment of the conditions prescribed in the contract is violated.
Generally speaking, the depositor has the right to demand termination of the contract after its conclusion. However, the agreement itself loses its force no less than three months after the relevant application has been submitted. In addition, the depositor, by submitting an application, may require a change in the contractual terms, while the insurer is obliged to consider it.
What is the difference between voluntary and compulsory insurance?
Voluntary pension insurance has the following differences from the mandatory:
- guaranteed by agreement of the parties, and not by the state;
- requires the will of the participants, but not necessarily;
- makes it possible to choose the payment procedure and tariffs, while for compulsory insurance they are established on the basis of current legislation;
- the policyholder can independently choose the company that will accumulate his pension funds, unlike the mandatory one, where contributions are paid to specific off-budget funds;
- NPFs form their budget from investment income and deposits of individuals and legal entities, while the budget of state funds is created through contributions from employers and individuals who engage in specific activities;
- the insurance scheme is more important for voluntary insurance, and for mandatory insurance - interest for the tax base and tariff.
Voluntary insurance in the pension sector is additional to voluntary entry for compulsory pension insurance, therefore the main payments under such an agreement are called supplementary pension.