Brazilian Private Brazilian Private Pension SystemPension System

Hélio Portocarrero Hélio Portocarrero

Ministry of FinanceSUPERINTENDENCY OF PRIVATE INSURANCE (SUSEP)

Brazilian Private Pension SystemBrazilian Private Pension System

• Open Pension Funds

• Ministry of Finance

• National Council of Private Insurance - CNSP

• Superintendency of Private Insurance - SUSEP

• Insurance Companies and Open Pension Funds

The products are available for any customer, by

individual or group contracts, sponsored or not.

Ministry of FinanceSUPERINTENDENCY OF PRIVATE INSURANCE (SUSEP)

Brazilian Private Pension SystemBrazilian Private Pension System

• Closed Pension Funds

• Ministry of Social Security

• Closed Pension Management Council - CGPC

• Closed Pension Funds Secretary - SPC

The products are only available for specific groups,

linked to a sponsor, who may be an employer, a manager

of association or union - Law 109/01 (occupational funds

and union funds)

Ministry of FinanceSUPERINTENDENCY OF PRIVATE INSURANCE (SUSEP)

Open Pension PlansOpen Pension Plans

• Benefits by:

• survivorship;

• disability;

• death.

• Payment as an annuity or as a lump sum.

• Full portability, during the accumulation phase, to transfer the

funds to another open or closed pension provider company.

• Withdrawal of the contributor’s accumulated balance, after a

period established by the company - limited to 24 months.

Ministry of FinanceSUPERINTENDENCY OF PRIVATE INSURANCE (SUSEP)

Open Pension PlansOpen Pension Plans

• Traditional products – Defined benefits only.

• New line of products – defined contributions mostly.

• Liabilities are linked to shares of special mutual funds - PGBL,

PAGP e PRGP:

• PGBL - It doesn’t guarantee minimum rate of return and has

several alternative investment options.

• PAGP - The accumulation rate is guaranteed at a specified

index, and there is a surplus share.

• PRGP - Besides the index and the surplus, there is a

specified rate of return.

Ministry of FinanceSUPERINTENDENCY OF PRIVATE INSURANCE (SUSEP)

Mixed PlansMixed Plans

• Besides the survivorship benefits, they pay benefits in case

of death and/or disability of the contributor.

• The company can use resources from the survivorship

provision to finance other benefits (Communicability).

• They offer better disclosure terms to customers.

• They make easy for customers to remain in the plan, until the

retirement date.

• The companies have more flexibility to remunerate agents.

Ministry of FinanceSUPERINTENDENCY OF PRIVATE INSURANCE (SUSEP)