It’s important to us to explain the complex topic of the occupational benefit scheme as comprehensibly as possible. However, sometimes we cannot get around using technical terms. In our glossary we explain these technical terms briefly and in a reader-friendly manner.
Federal Social Insurance Office
The Federal Social Insurance Office (FSIO) comes under the Federal Department of the Interior (FDI) and is, by analogy with the Federal Office of Private Insurance (FOPI), the highest authority vested by the Federal Council with the responsibility of supervising social insurance.
Final vested retirement assets, projected
This term refers to the hypothetical final vested retirement assets (BVG/LPP) at regulation retirement age.
The full amount, consisting of retirement credits and interest, is also referred to as the projected final vested retirement assets with interest. A rate of conversion is used with this value to calculate the BVG/LPP old-age pension.
The funding ratio is the ratio of available pension assets to the mathematical reserve required to meet all a pension fund’s obligations. 100% corresponds to full coverage of the obligations.
“Underfunding” is defined as a funding ratio of less than 100%, while “overfunding” is any ratio over 100%.
Fund-linked life insurance
In the case of fund-linked life insurance, the portion of insurance contributions which are normally invested in the unearned premium reserve (savings portion) is used to acquire fund units. There are life insurance policies which allow the policyholder to choose from a range of funds, as well as policies which allow the policyholder to simply select an investment focus (bonds, equities, real estate, etc.).