Headline: Bulgaria‘s Financial Supervision Commission (FSC) Announces Key Indicators for Supplementary Lifetime Pensions
The Financial Supervision Commission (FSC) of Bulgaria has announced that two key indicators—technical interest rate and mortality and longevity tables—will determine the size of supplementary lifetime pensions paid out by private pension funds. Here’s a breakdown of how this is calculated:
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Natrpunned Funds & Indicator Tables: The monthly payment size is calculated based on the funds accumulated in the individual’s account, adjusted if necessary, at the time of signing the pension contract. It also considers official mortality and longevity tables published by the National Statistical Institute and the technical interest rate approved by the FSC.
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Pension Reserves & Technical Interest Rate: Pension insurance companies calculate the reserves needed to pay out lifetime pensions using the technical interest rate and mortality tables, certified annually by the FSC before December 31. For the year ending December 31, 2024, the FSC has decided to retain the current technical interest rate, considering the achieved investment returns of voluntary pension funds and the yield of long-term government bonds, as well as geopolitical, financial, and economic factors.
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Mortality Tables for 2021-2023: The biometric tables of mortality used for calculating reserves for 2024 are based on the mortality and longevity table for the 2021-2023 period, with an expected lifespan of 73.47 years for those born in 2021. The upcoming pensioners, aged 62 years and 4 months for women and 64 years and 8 months for men, are expected to have around 17-15 years of life expectancy.
- Pension Payment Conditions & Guaranteed Amount: The supplementary lifetime pension for old age is granted when the calculated monthly payment is not less than 15% of the minimum pension. The guaranteed amount is determined based on the gross amount of insurance contributions transferred from the National Social Security Institute (NSSI) and the National Revenue Agency (NRA).
For retiring persons whose individual account balance exceeds the gross amount of contributed insurance payments, an additional supplementary lifetime pension with a guaranteed amount equal to the first pension calculated using the individual account balance can be paid out, upon request.
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