According to the federal Constitution (Article 34), the retirement, widowhood and disability insurances in Switzerland rest on three “pillars”: public insurance, contingency funding and individual insurance. This is why our insurance system is also called the "three pillars principle".

Tasks allocations in the insurance system

First category (AVS)

Under the terms of the Constitution, the first category of our insurance system, the retirement and widowhood insurance (AVS) and the disability insurance (AI) must guarantee a vital income. If the AVS/AI benefits are not sufficient, complementary benefits are granted. Moreover, it is possible to ask for an additional disability benefit in the event of serious medical trouble. The AVS/AI is a general public insurance. It ensures any person living or working in Switzerland as Swiss nationals working abroad for a Swiss employer.

Second category (LPP)

Contingency funding, the second category, is obligatory for all employees earning minimal wages. It is implemented by the companies or trade associations, employers and employees pay for it together. It must keep up the standard of living after retirement up to a certain income by using the profits of the first category insurance. With the contingency funding system, benefits can exceed the minimum set by the contingency funding Act (LPP).
The self-employed can be ensured according to the rules of the contingency funding Act.

Third category (OPP3)