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Conversion rate

What is a conversion rate? Find the definition here.

The conversion rate or conversion factor is the percentage used by pension funds to calculate the amount of the annual pension. Upon retirement, the rate is multiplied by the retirement assets that an individual has saved. The level of the conversion rate for mandatory employee benefits insurance is determined in the BVG. In the extra-mandatory area, the pension funds set the interest rate on retirement assets and the conversion rate at their discretion.

More terms relating to retirement provision can be found in the glossary.