Glossary

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.

Occupational mobility

This is the right possessed by most insured persons - under certain conditions and not taking restrictions on admission (age, state of health, etc.) into account - to change from one insurance company to another for health plans, pension plans, when changing employer, and so on.

Occupational mobility credits

In principle, occupational mobility credits correspond to the vested retirement assets created when an interested party leaves his occupational benefit plan for a reason other than an insured event. The new law introduces the notion of total occupational mobility both for the mandatory part of a plan and the part over and above this. The whole amount of an occupational mobility credit - mandatory part and part exceeding the minimum - must be transferred to the new occupational benefit plan.

Occupational mobility policy

If for some reason occupational mobility credits cannot be transferred to a new occupational benefit plan, the credits may be kept through the creation of an occupational mobility policy.

The occupational mobility policy is a special form of capital or annuity insurance under Pillar 2 which exclusively and irrevocably serves as part of long-term savings, including any supplementary insurance for death or disability. A minimum interest rate is guaranteed.

Occupational pension plan

Employers with personnel subject to mandatory insurance are obliged by the BVG/LPP either to create an occupational employee pension plan - also known as an employee benefit plan - or to join an already existing pension plan. This measure demonstrates the government's intention to protect the capital paid into the pension plan in the event of the employer's going bankrupt and to guarantee its existence for the future benefit of the employees. Pension plans participating in the application of the mandatory insurance provisions must enter their name in the occupational pension plan register. The law allows pension plans to choose their structure from among various legal forms - a fund, a cooperative society or an institution based on public law.

Occupational pension plans

The BGV/LPP (Federal Law on Occupational Benefit Plans concerning Old-Age, Survivors' and Invalidity) lays out the regulations for employees' occupational pension plans - the compulsory 2nd pillar of the triple-pillar system. The aim of these plans - in conjunction with AHV/AVS and IV/AI benefits - is to enable surviving dependants, the elderly and disabled persons to maintain a standard of living as close as possible to their previous standard. All employed persons subject to AHV/AVS contributions and with a minimum income fixed by the employer are covered. The main benefits provided by the BGV/LPP are payment of old-age pensions, widows' and orphans' pensions and invalidity pensions.

Old-Age and Suvivors' Insurance

The old-age and survivors' insurance (AHV/AVS) has been in force since 1948 though there have been several revisions to it since then. Along with the AI, the AVS constitutes the first pillar of the Swiss "triple-pillar system" and is designed to provide a minimum standard of living. It is compulsory for all persons living and working in Switzerland. Eligible persons receive old-age and survivors' pensions as well as allowances for helplessness and auxiliary measures. Rightful claimants are all either insured persons or their survivors. Special arrangements apply to non-Swiss nationals.