How to Join?
- Joining the voluntary pension fund means that the person will open a pension account and make contributions to any of the voluntary pension funds. A pension account can be opened in any of the Estonian commercial banks (account operators).
- In order to take the pension insurance with guaranteed interest rate, you should contact a life insurance company and ask for an offer for the III pillar pension insurance through their internet homepage or e-mail. You can also communicate your wishes and questions to a sales representative of an insurance company who will be ready to meet you when and where it is most suitable for you.
- The contracts of pension insurance with investment risk can be concluded at insurance companies, banks and in certain cases in the internet. You can keep an eye on your assets through the internet environment of the respective life insurance company or bank with whom you have concluded the contract.
The pension fund or a fund is a pool of money. Its owners are investors who have placed their money in the fund. The units of a fund are very liquid – they can be resold at any time. Resale or redemption of units is facilitated by the fund itself due to the fact that the fund always buys its units back.
When making contributions to the fund, the transaction is made with the requisite information foreseen in the find conditions to the account of the Pensionikeskus AS at the State Treasury.
With the payment of money into the fund, units of the pension fund are acquired. The purchased units are registered to the pension account at the Estonian Pension Register (Pensionikeskus AS). Units of mandatory and voluntary pension funds are purchased on the same account. You can keep an eye on the status of your pension account through the internet in the self service environment of Pensionikeskus AS.
When accruing money into a pension fund, the level of risk is higher and the future interest is not known. Accruing money through funds allows to earn more in a long-term perspective although there are no guarantees for the profitability. At the same time, several different insurance products or funds can be used simultaneously.
In order to invest into a supplementary pension fund, a transfer must be made to the account of the Pensionikeskus AS. Purchasing units is as simple as making a regular bank transfer.
Insurance with Guaranteed Interest
The pension insurance with guaranteed interest is a classic savings insurance. A contract is concluded between the client and the insurance company, establishing the promised rate of return. The person will conclude a contract with an insurance company and will make contributions according to his or her possibilities.
The investment risk is transferred to the insurer who will guarantee a certain minimum rate of return on the reserves for the client. If the investment results are good, the company may pay an additional interest to the client. By the end of the savings period, a sum is accrued, which will then be paid to the client according to the option established in the contract.
In practice, the assets are accrued at the insurance company as follows:
- a person pays insurance premiums,
- the insurance company deducts its expenses from the premiums and will place the rest of the money in insurance reserve,
- the insurer invests the assets of the insurance reserve as allowed by the law.
Increase of the value of these investments is a part of the profit of the client.
The second part of the client’s profit constitutes of the additional interest paid by the insurer from the yielded profit. As a rule, the additional interest will also be transferred to the insurance reserve.
The total sum of the pension or payments is the size of the insurance reserve accrued on the basis of the respective contract at the time of the expiry of the contract.
Pension insurance is offered by the following companie:
Compensa Life Vienna Insurance Group SE: Pension Insurance with Guaranteed Interest
Pension Insurance with Investment Risk
The pension insurance with investment risk is suitable for a person wishes to collect pension and choose the risk rate of the investment, the person has to be well-informed of the basic principles of investments. The contributions can be made as regular contributions or in a lump sum.
The sums paid into the contract will be associated with investment funds. There is no guarantee for yield, but through long term collection through funds, the yield can be higher than through pension insurance with guaranteed interest.
The yield of the product depends on the success of the selected investment funds, which in turn depends on the movement of the securities markets. The total sum of pension or payments is the total sum of the fund units at the time of the expiry of the contract.
The products with investment risk are divided into two:
- pension insurance and
- personal investment portfolio.
In essence these two products are very similar. These are financial products that have extensive options for dispersing investments, allowing a person to manage their pension and life insurance assets and to determine contributions of which size will be invested into certain funds or fixed instrument.
During the contract period, the investments can also be re-allocated. The product has a higher level of risk and the revenue or the expenses yielded from the contributions depend on how the underlying assets of the contract are doing and the changes in their market value.
Collecting a pension with investment risk allows:
- a person to influence the state and rate-of-return of their investments,
- preparing an investment portfolio from different international investment funds (independently or with the help of specialists),
- changing, if necessary, the structure of the investment portfolio,
- adding, if necessary, life insurance to the contract.
Pension insurance with investment risk is offered by:
- Compensa Life Vienna Insurance Group SE: Pension Insurance with Investment Risk
- SEB Life and Pension Baltic SE Estonian branch: Growth Portfolio for Pension
- Swedbank Life Insurance SE: Private Portfolio for Pension
For those who are less interested in taking risks, a guarantee has been added to the products with investment risk, which will ensure maintaining of the contributed sums, but only if the contract is valid until the end of the insurance period.
If the investments have lost even the majority of their value, the entire sum of contributions can be withdrawn at the moment of expiry of the contract, from which only the contractual fee is deducted.
Pension products with investment risk and guaranteed contributions is offered by:
- SEB Life and Pension Baltic SE Estonian branch: Guaranteed Pension Insurance
Investeerimisriskiga tooted jagunevad kaheks:
- pensionikindlustus ja
- personaalne investeeringute portfell.
Sisult on need kaks toodet väga sarnased. Need on väga suure investeeringute hajutamise võimalusega finantstooted, mis lubavad inimesel juhtida oma pensioni- või elukindlustuse varasid ning määrata ise, kui suur osa sissemaksetest teatud fondi või mõnda fikseeritud instrumenti investeeritakse. Kogumisperioodi jooksul saab investeeringuid ka ümber paigutada. Toode on suurema riskitasemega ning sissemaksetest saadav tulu või ka kulu sõltub lepingu alusvara käekäigust ja selle turuhindade muutusest.
Investeerimisriskiga pensionikogumine võimaldab:
- mõjutada ise oma investeeringute käekäiku ja tootlust,
- koostada investeerimisportfell erinevatest rahvusvahelistest investeerimisfondidest (iseseisvalt või spetsialistide abiga),
- muuta vajadusel oma investeerimisportfelli struktuuri,
- lisada vajadusel lepingule ka elukindlustuse.
Investeerimisriskiga pensionikindlustus sobib inimesele, kes soovib koguda pensioni ning valida ise investeeringu riskiastet, ühtlasi peab ta hästi tundma investeerimise põhitõdesid. Sissemakseid saab teha regulaarsete summadena või ühekordselt.
Lepingusse makstud summad seotakse investeerimisfondidega. Garantiid tulususele ei ole, kuid fondide abil pikaajaliselt kogudes võib teenida rohkem kui garanteeritud intressiga pensionikindlustuse abil. Toote tulusus sõltub valitud investeerimisfondide edukusest, mis omakorda tuleneb väärtpaberiturgude liikumisest. Pensioni ehk väljamaksete kogusumma on fondiosakute summa kokku lepingu lõppedes.
Investeerimisriskiga pensionikindlustust pakuvad:
- Compensa Life Vienna Insurance Group SE: Investeerimisriskiga pensionikindlustus
- Mandatum Life Insurance Company: Investeerimisriskiga elukindlustus pensioniks
- SEB Elu- ja Pensionikindlustus AS: Garanteeritud pensionikindlustus ja Kasvuportfell pensioniks
- Swedbank Life Insurance SE: Pensionikindlustus+ ja Privaatportfell pensioniks
Vähem riskialtimatele klientidele on lisatud investeerimisriskiga toodetele garantii, mis tagab sissemakstud summade säilimise, kuid seda üksnes juhul , kui leping kehtib kuni kindlustusperioodi lõpuni. Juhul kui investeeringud on kaotanud kas või enamuse oma väärtusest saab lepingu lõppedes kätte kogu sissemaksete summa, millest on maha arvatud üksnes lepingu tasu.
Garanteeritud sissemaksetega investeerimisriskiga pensionitooteid pakuvad:
- SEB Elu- ja Pensionikindlustus AS: Garanteeritud pensionikindlustus
- Swedbank Life Insurance SE : Pensionikindlustus+
When investing, you should read carefully the terms and conditions of different products and strategies of different funds/insurance companies.
Before concluding a contract, we recommend talking to specialist(s) of the field. Specialists who provide advice are available at all banks and insurance companies.