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Annuity Insurance Last Modified:2014-07-10
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1. Implementation conditions
  (1) Business entities employing 200 or more employees.
  (2) Consent of the labor union, or if no labor union exists, requiring the consent of a labor-management meeting
  (3) Permission from the central competent authority.
     
2. Rate of annuity insurance premiums and payment periods
  The insurer shall prepare a monthly bill that lists the total amount of the annuity insurance premiums to be paid by the employer as well as the total amount of the annuity insurance premiums to be paid by the employees voluntarily and mail it to the business entity by the 25th day of the following month. The employer shall make the payment by the end of another month. By the 7th day of the month following the month when the payment is due, the insurer shall inform the BLI how the premiums have been collected.
3. Regulations for insuring persons, insured persons and beneficiaries
  The employer shall be the provider of the contract of annuity insurance, and the worker shall be the insured and beneficiary. A business entity shall purchase annuity insurance from a single insurer. The qualifications of an insurer shall be set forth jointly by the central competent authorities along with the competent authorities in charge of such insurance.
4. A worker employed in a business entity that has adopted annuity insurance may change their preferred pension system
  A worker employed in a business entity that has adopted annuity insurance, who has opted instead for the new pension system provided by the Labor Pension Act, now can choose between staying with the individual pension system or transferring to annuity insurance. However, in order to reduce the likelihood of complications arising between employers and employees over switchovers, a restriction on one switch per year is imposed. The employer is responsible for informing the Bureau of Labor Insurance of any changes made by an employee within 15 days of a switch. The newly selected pension option takes effect on the first day of the following month. For instance, if a worker who has previous used individual pension account successfully applies to transfer over to annuity insurance on January 20, 2014, the worker's annuity insurance plan takes effect on February 1, 2014.
5. Continuing annuity insurance after an insured worker resumes employment after leaving work
  (1) In the event that a worker resumes employment at a business entity using annuity insurance:
    The new employer should take over as the insuring person of the worker's original insurance contract and continue to insurance contributions. Should the rate of contribution be lower than the previous annuity insurance, the worker must contribute him/herself if the rate is to be maintained. The new employer, however, is not restricted from additionally contributing to maintain the previous rate. If the worker decides to transfer over to an individual pension account system, then his/her employer is obliged to contribute.
  (2) In the event a worker resumes employment at a business entity not adopting annuity insurance:
    The new employer must contribute to the worker's individual pension account. As for the original annuity insurance contract's insurance premium, barring any arrangements between employer and employee, the worker shall be responsible for the premium for the annuity insurance in full. If the worker is unable to pay the premium , the preservation of the annuity insurance contract will be evaluated in accordance to the Insurance Act and related insurance contracts.
6. Transferring between individual pension accounts and annuities insurance for employees for left and then resumed employment
  (1) A worker who originally had individual pension accounts and may transfer to annuities insurance:
    a. Conditions for transferring: Total length of contribution cannot be less than 4 years.
    b. Procedures for transferring: One time transfer of the principal and accrued dividends of the worker's individual pension account into annuity insurance account.
  (2) A worker who originally participated in annuities insurance and may switch to individual pension accounts:
    a. Condition for transferring: Total time period of premium payments cannot be less than four years.
    b. Procedures for transferring: One-time transfer of the annuity deductible to an individual pension account.

 

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