Procedure for change of mandatory pension insurer revised

Starting from 1 January 2019, a new procedure comes into force that regulates the change of mandatory pension insurer, which may be either the Pension Fund of the Russian Federation (PFR) or a non-governmental pension fund (NPF).

Russians can now apply to change insurer on the Public Services Portal (PSP) or at the PFR office in person or by proxy. A similar procedure applies when submitting a notice of refusal to change insurer.

To transfer pension savings from the PFR to an NPF or between NPFs, policy holders have to conclude a mandatory pension insurance agreement with the preferred fund.

A transfer application should be submitted before 1 December. A cooling-off period will last until 31 December. During this period policy holders may change their mind and stay with their current fund or choose another one. In this case, they will have to submit a notice of refusal to change the insurer or an application to change the insurer.

Importantly, should a policy holder submit more than one transfer application to the PFR within one year without submitting a notice of refusal to change the insurer, the PFR will deny satisfaction of the second and any further application.

The regulation stipulates that individuals must be notified about the amount of forfeited investment income in their account when submitting an application to change the insurer via the PSP or the PFR.

Customers can track their applications and notices, their submission date and manner, and the decision taken on the Public Services Portal. PFR employees will register hardcopy notices on the PSP, and they will be available in users’ personal accounts. That said, policy holders will be able to obtain this information in person in the regional branch of the PFR or a selected NPF.

Furthermore, within one business day after the receipt of a notice of refusal to change the insurer or an application to change the insurer, the PFR will forward the document to the non-governmental pension funds concerned (the policy holder’s current and preferred funds) through the System of Interdepartmental Electronic Collaboration.

The amendments are aimed at countering illegal transfers of pension savings to non-governmental pension funds with the use of forged documents, and provide Russian citizens with new information, which will help them make more weighted decisions when choosing or changing the way they invest their pension savings.