Occupational pensions and pension insurance

What is an occupational pension?

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An occupational pension is a benefit to which some employees may be entitled in their employment; it is financed in its entirety by employers in accordance with the Income Tax Act. An occupational pension can be defined as a deferred salary for work performed.

 

An occupational pension plan normally includes the following financial protection/security:

 

When you retire

• Retirement pension

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If you die before the age of 65

• Survivor protection (may vary depending on plan)

• Service group life insurance (TGL)

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If you get sick:

• Sick pension (after 90 days)

• Premium exemption

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Tax-approved forms of insurance are:

• Pension insurance

• Provision on the balance sheet in combination with credit insurance

• Transfer to a pension fund

• Transfer to a foreign occupational pension institution (subject to certain conditions)

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Alternative pension:

• Direct pension that is not a tax-approved form of insurance

 

The importance of proper handling

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The rules regarding occupational pensions are extensive and complicated and are surrounded by both contract and tax law along with insurance technology. The incidence of incorrect occupational pension management is increasing. Since pensions in practice constitute deferred salary, incorrect handling often has major financial consequences for the employer in the form of extensive costs, investigative work and administrative insurance efforts.

 

Improper occupational pension management will be discovered eventually. The employee may even have had time to quit and retire. These cases may also need to be addressed.

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Another not entirely unusual error is where an employer, in connection with a collective agreement, pays their insurance premiums to the wrong insurance company. This may have happened if you have taken out the pension before signing a collective agreement, and you miss that in order to not act in violation of the agreement, you have to change your insurance. In these cases, the employer risks covering retroactive costs.

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Failure to ensure the quality of one's own occupational pension management is a risk. It can lead to irreparable damage in, for example, long-term sick leave and early retirement. Improper old-age pension management may mean there is a need to make payments to catch up with retroactive costs which may affect the company's liquidity. 

 

Our offer in occupational pension

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In the area of occupational pensions, we collaborate with some of Sweden's foremost experts.

 

If you have questions about occupational pensions, premium payments, parallel coordination or ITP exemptions, you are welcome to contact us. We ensure that you, through us and our partners, receive the right support in handling your pension issue.