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Payments

Payments are made from the funded pension when an employee has made contributions during their employment and they have reached the age of old-age pension.

Receiving payments from the funded pension is not related to receiving the state old-age pension. A person has the choice whether to start receiving state old-age pension and mandatory funded pension together. At the same time, it is possible to start receiving first the state old-age pension and defer the receipt of mandatory funded pension or vice versa.

Generally, the payments are made by the insurance company on the basis of the pension contract. If the sum of money accrued is small, payments can also be made directly from the pension fund (fund pension). In special cases, if the money collected is below a certain limit, it is possible to take it all out at once.

To receive payments, an application must be submitted to an insurance company in order to conclude an insurance contract or to a bank in order to receive payments from the pension fund. Before submitting an application, the total value of the shares must be established. It can be done through the My Account section of pensionikeskus.ee, but also by contacting a bank or insurance company.

The payment options depend on the total value of the units belonging to the owner of the units.

Ratio of total value of the units and national pension rate  Available options
 Total value of the units* is less or equal than 10 x NPR** – Entire sum at once
– Regular payments from the Pension Fund
– Lifetime payments from an Insurance Company
 Total value of the units* is more than 10 x NPR** but less than 50 x NPR** – Entire sum at once is not allowed
– Regular payments from the Pension Fund
– Lifetime payments from an Insurance Company
Total value of the units* is equal or more than 50 x NPR** – Entire sum at once and regular payments from the Pension Fund is not allowed 
– Lifetime Payments from an Insurance Company
 Total value of the units* is more than 700 x NPR** – Lifetime payments from an Insurance Company for the full amount
– Lifetime payments from an Insurance Company up to 700 x NRP** and with the remaining amount: regular payments from the Pension Fund, entire sum at once if the conditions are met or second lifetime payment contract from an insurance Company

* Total value of the units – the total value of all the units of the pension funds that belong to the owner of the units.
** NPR – the national pension rate, which since 1 April 2016 is €167.40 (in 2015, €158.37).

After the owner of the units has chosen a payments scheme, taking into account the possibilities that depend on the total value of their units, he or shell concludes a pension contract with an insurance company, agrees with the fund manager on the fund pension or makes an application for single payment.

On the basis of the pension contract concluded with an insurance company, regular payments are made until the death of the policyholder.

In case of the fund pension, payments are also made regularly until the money collected to the fund runs out.
In case of the single payment, the total sum is paid at once and no more payments are made (provided that the owner of the unit does not acquire additional units).