When will the retirement insurance accounts be suspended? What should be noted during the suspension of the retirement insurance accounts in Vietnam?
What are the regulations on suspension of retirement insurance accounts in Vietnam?
Pursuant to the provisions of Article 2 of Circular 115/2013/TT-BTC, the definition of pension insurance is as follows:
Pension insurance is a product of life insurance which is performed by insurers with the aim to provide an additional income to insured persons upon they passed the working age
Pursuant to the provisions of Clause 1, Article 121 of Decree 46/2023/ND-CP stipulates as follows:
Suspension of retirement insurance accounts
1. The policyholder and the insurer may agree to suspend the retirement insurance account temporarily if the policyholder cannot afford the premium.
According to the above regulations, the policyholder and the insurer may agree to suspend the retirement insurance account temporarily if the policyholder cannot afford the premium
When will the retirement insurance accounts be suspended? What should be noted during the suspension of the retirement insurance accounts in Vietnam?
What should be noted during the suspension of the retirement insurance accounts in Vietnam?
Pursuant to the provisions of Clause 2, Article 121, Decree 46/2023/ND-CP stipulates things to note during the temporary closure of pension insurance accounts as follows:
- During the suspension of the retirement insurance account, the insurer is prohibited from charging any fee to the policyholder.
- The value of the retirement insurance account is accumulated according to the investment rate announced annually by the insurer as agreed in the insurance policy.
The insurer is not obliged to pay out benefits during the suspension period, except for two cases: periodic retirement benefits when the insured reaches a certain age; or death and disability benefits if the insured dies or has total permanent disability (with the entire value of the accumulated retirement insurance account).
In what cases is the insured person entitled to request an advance withdrawal of pension insurance?
Pursuant to the provisions of Article 118 of Decree 46/2023/ND-CP stipulates as follows:
Retirement insurance accounts
1. The retirement insurance account is a separate account for each insured person that holds the accumulated premiums paid after deducting the initial fee. The account is opened, monitored, and managed by the insurer.
2. The insurer must commit the minimum investment interest rate in the retirement insurance account in the insurance policy. At the end of each fiscal year, the insurer is responsible for announcing the investment interest rate and accumulated account value up to that time. If the investment returns of the retirement insurance account are lower than the committed interest rate, the insurer must use the assets of its owner’s fund to cover any shortfalls. In case the insurance policy has an agreement on the accumulation of insurance benefits into the value of the retirement insurance account, these benefits will still be calculated with accrued interest as prescribed at Point c, Clause 2, Article 115 of this Decree.
3. The insured person may not withdraw from the retirement insurance account before the maturity date when he/she reaches the retirement age, as specified in the insurance policy, except for the case specified in Article 119 of this Decree.
Thus, the insured person may not withdraw from the retirement insurance account before the maturity date when he/she reaches the retirement age.
However, there are cases of early withdrawal from retirement insurance accounts based on Article 119 of Decree 46/2023/ND-CP stipulated as follows:
Early withdrawal from retirement insurance accounts
The insured is entitled to request for early withdrawal and the insurer is responsible for paying part or all of the value of the retirement insurance account in the following cases:
1. The insured person has a degree of impairment from 61% or more as per applicable law.
2. The insured suffers from a fatal disease as prescribed by law.
3. The insured person is a Vietnamese citizen who is legally permitted to reside in a foreign country by a competent authority.
4. The insured may withdraw from the retirement account early to pay off their personal loans (except for consumer loans) at a bank, provided that the loan contract must remain valid for at least 24 months before the maturity date of the retirement account.
Thus, there are 4 cases of early withdrawal from retirement insurance accounts as follows:
(1) The insured person has a degree of impairment from 61% or more as per applicable law.
(2) The insured suffers from a fatal disease as prescribed by law.
(3) The insured person is a Vietnamese citizen who is legally permitted to reside in a foreign country by a competent authority.
(4) The insured may withdraw from the retirement account early to pay off their personal loans (except for consumer loans) at a bank, provided that the loan contract must remain valid for at least 24 months before the maturity date of the retirement account.
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