Pension insurance can be divided into several types

At present, pension insurance in the countries of the world where it is practiced can be categorized into three types, i.e., insurance-funded (also called traditional) pension insurance, mandatory savings pension insurance (also called provident fund model) and state-coordinated pension insurance.

The insured-funded pension insurance is one of the pension insurance models. The government adopts the relevant legislation as the basis for its compulsory implementation, and in addition to the individual's payment of pension insurance premiums and the enterprise's payment of social insurance premiums for its employees, the government also allocates funds from the treasury as part of the insurance fund in accordance with the law. After the insured person reaches a certain age and retires and is relieved of his or her labor obligations, he or she receives a regular pension, the amount of which is usually related to the level of income at the time of work. The United States, Japan and others adopt this model. It emphasizes that self-insurance is the mainstay, while the state provides financial support, reflecting the unity of rights and obligations and a strong sense of social solidarity. Shortcomings include: the complexity of the criteria for payment of old-age insurance premiums, which are not easy to grasp; and the fact that, as the process of population ageing accelerates, the burden on the State, enterprises and members of society will become heavier and heavier, and will constrain the development of a country's economy. This model of countries, began to shift to multi-level pension insurance, that is, according to different pension insurance objectives, the establishment of different levels of pension insurance system

Mandatory savings-type pension insurance is the developing countries in Southeast Asia as the main implementation of a pension insurance system. It is called the "Central Provident Fund System" and was first established in the 1950s. According to incomplete statistics, there are more than 10 countries, such as Fiji, Ghana, India, Indonesia, Malaysia, Kenya, Nepal, Nigeria, Singapore, Sri Lanka, Tanzania, Uganda, Zambia, and the Solomon Islands, among which Singapore's achievement is the most remarkable. Its most distinctive feature is that it does not require the State to allocate funds financially, and it is compulsory for employees and employers to take out insurance at the same time. The principle of self-insurance is fully realized.

The state-integrated pension insurance system refers to a typical welfare pension insurance system in which the state (or the state and the employer) pays all of the employee's pension insurance premiums, and the employee does not make any personal contributions.

The role of pension insurance:

1. Guaranteeing old-age life: the most basic role of pension insurance is to provide old-age protection for the insured and to guarantee a certain source of livelihood after retirement. At present, China's social security system is constantly improving, pension insurance has become one of the main components of China's social security. Participants pay a certain amount of pension insurance premiums, you can get the basic pension insurance benefits after retirement, to ease the financial pressure after retirement.

2. Improving the quality of life in retirement: In addition to the basic pension insurance, there are also additional pension insurance such as enterprise annuities and occupational annuities. These additional pension insurance can further improve the quality of retirement life. Enterprise annuity is a form of enhanced welfare protection for employees by enterprises, which can supplement the basic pension insurance and provide better retirement treatment. And occupational pensions, which are pension insurance plans centrally managed by occupational groups or trade associations, are also a way for enterprises to strengthen employee welfare protection.

3. Promote consumption upgrade: The popularization of pension insurance can also promote consumption upgrade. Pension insurance provides peace of mind for the elderly in their retirement, so that they are no longer weighed down by financial pressures and thus have more money to spend on daily life and consumption. This also means that with the popularization and improvement of pension insurance, the spending power of the elderly group will be enhanced, helping to promote consumption upgrading.

4. Reduce family economic pressure: The popularization of pension insurance can also reduce family economic pressure. In the traditional model of old age, children need to bear the burden of old age after their parents' retirement. And with the development of pension insurance, the elderly can obtain certain retirement benefits through pension insurance, reducing the financial burden of children. This can not only improve the quality of life of the elderly, but also enable their children to face the pressure of daily life and work more comfortably.

In summary, old-age insurance can not only provide old-age protection, but also improve the quality of life in retirement, promote consumption upgrading, and reduce the financial pressure on the family. As an important social security system, the popularization and improvement of pension insurance will help meet the needs of the elderly in their old age and promote social progress.

Legal basis:

The Social Insurance Law of the People's Republic of China

Article 12

Employing units shall pay basic pension insurance premiums in accordance with the ratio of the total wages of the employees of the unit as stipulated by the state, which shall be credited to the Basic Pension Insurance Co-ordination Fund.

Employees shall pay basic pension insurance premiums in accordance with the proportion of their own wages prescribed by the State and credited to their individual accounts.

Individual industrial and commercial households without employees, part-time workers who have not participated in the basic pension insurance in the employing organization, and other flexibly employed persons participating in the basic pension insurance shall pay the basic pension insurance premiums in accordance with the state regulations, which shall be credited to the basic pension insurance general fund and the individual account respectively.