Retirement
The Swiss system of insurance in anticipation of old age, death and disability is based on three pillars. It operates with both social insurance and private personal insurance. The legal basis for the concept of the three pillars is found in the Constitution of the Swiss Confederation (art. 111). Paragraph 1 of this article states: “The Confederation shall take measures to ensure adequate old-age, survivors’ and invalidity insurance. This provision is based on the three pillars of federal old-age, survivors and disability, occupational insurance and individual insurance.”
The first pillar is often referred to as “state foresight or public provision”, the second “professional presence” and the third “private foresight”.
Foresightedness
1st pillar
State foresight
2nd pillar
Professional insurance
3rd pillar
Individual foreseeancement
Purpose: minimum subsistence
Purpose: maintenance of the previous standard of living
Purpose: individual complement
- Old and Survivors Insurance (AVS)
- Disability Insurance (AI)
- Supplementary Benefits (PCs)
- Compulsory vocational insurance (LPP)
- Compulsory Accident Insurance (LAA)
- insurance above the statutory minimum
- tied foresight (pillar 3a)
- free provision (pillar 3b)
The LAMA (Sickness and Accident Insurance) is accepted. It is the legal basis for the NAC (as the predecessor of the LAA).
The law of obligations (CO) is supplemented by the first provisions referring to pension funds.
The AVS enters into force.
The AI enters into force.
The concept of the three pillars is enshrined in the Federal Constitution (art. 34-quater).
The LAA enters into force.
The LPP enters into force.
The legal basis for tied insurance (LPP3) comes into force (pillar 3a).
The Occupational Insurance Free Access Act (LFLP) and the provisions promoting access to housing enter into force.
The 10th revision of the AVS enters into force.
The revised Federal Constitution enters into force. The concept of the three pillars is the subject of new rules in the art. 111 (para. 1).
1st revision LPP
5th AI Revision
Revision 6a AI
AVS Reform
|
Pillar
|
Content
|
Insured persons
|
Objectives
|
|---|---|---|---|
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1st Pillar Public Pre-Affecture (federal insurance)
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AVS: Old and Old Age Insurance AI: PC Disability Insurance: Supplementary Benefits to AVS and IA
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Mandatory: for all persons working or living in Switzerland Optional: for all Swiss living abroad outside the EU/EFTA
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Meeting the basic needs of life
|
|
2nd pillar Professional provision
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LPP:
occupational insurance (compulsory LPP supplement) LAA: accident
insurance (- supplementary insurance to the LAA) Group sickness benefit
daily allowance
|
Mandatory:
LPP and LAA for employees in Switzerland Optional: LPP and LAA for
self-employed in Switzerland Compulsory LPP supplement for employees and
self-employed persons in Switzerland
|
Ensuring the previous standard of living (for small and middle-income earners)
|
|
3rd pillar Private provision (personal provision)
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3a: tied forage (tax advantages) 3b: free provision
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Mandatory:
no obligation to do so: 3a for assets in Switzerland with income
subject to AVS. 3b for all persons in Switzerland and abroad
|
Additional provision for early retirement or insurance of the previous standard of living for high incomes, etc.
|
LPP supplementary insurance and sickness loss insurance may be concluded by the employer on a voluntary basis for all employees or for some of them according to objective criteria. The entry of employees into the insurance is compulsory when they are part of the circle of insured persons.
Bank savings (including paper-value investments) are also included in the third pillar, as well as the acquisition of property ownership.
Reminder of the amounts applicable in 2023
- Minimum AVS/AI pension: 1225.- or 1/2 of the maximum AVS/AI annuity
- Maximum AVS/AI pension: 2450.- or twice the minimum AVS/AI annuity
- Minimum AVS/AI/APG contributions for self-employed and without gainful activity: 514.-
- Optional minimum AVS/AI ratio: 980.-
- Max. torque AVS waxas: 3675.-
- Minimum annual LPP wage: 22,050.- or 3/4 of the maximum AVS/AI annuity
- Coordination deduction LPP: 25,725.- or 7/8 of the maximum AVS/AI annuity
- Minimum coordinated wage LPP: 3675.-
- Maximum coordinated wage LPP: 62’475.-
- Upper limit of annual LPP salary: 88’200.-
- 3rd pillar A (3A) with second pillar: 7056.- or 8% of the upper limit LPP (88’200.-)
- 3rd pillar A (3A) without second pillar: 35’280.- or 40% of the upper limit LPP (88.200.-)
