The Slovenia Insurance Supervision Agency published an explainer on Slovenia’s second pension pillar, arguing that the first pillar will not be able to maintain retirement income at levels comparable to earnings during working life as demographic ageing worsens. The note positions funded saving through the second pillar as an increasingly important complement to the pay-as-you-go system. The agency highlights the decline in the employed-to-pensioner ratio from 2.3 in 1990 to 1.6 in 1992, with the figure again at 1.6 in 2025 after multiple reforms. It describes the second pillar’s main forms under ZPIZ-2: mandatory occupational pension insurance for specific arduous or health-damaging jobs and jobs that cannot be performed successfully after a certain age, funded by employers and carried by the Compulsory Supplementary Occupational Pension Insurance Fund (SODZP) managed by Kapitalska družba, and voluntary supplementary pension insurance largely delivered through collective plans by pension companies, insurers, or banks. Key incentives include income tax relief under ZDoh-2 for contributions up to statutory limits and a 50% tax allowance on paid pension annuities, subject to meeting legal conditions. Investment and benefit design is described as diversified and increasingly life-cycle based, with three age-segmented funds and an option for members to remain in the higher-risk “youngest” fund if they choose; where a fund provides a guaranteed return policy, it operates as a single fund without age grouping. Benefits are typically taken when first-pillar old-age pension conditions are met and paid as a lifelong annuity, a temporary annuity, or exceptionally as a lump sum under statutory conditions, with a follow-on article flagged on the third pension pillar.
Slovenia Insurance Supervision Agency 2026-02-11
Slovenia Insurance Supervision Agency outlines how the second pension pillar supports retirement income as demographic pressures widen the pension gap
The Slovenia Insurance Supervision Agency released an explainer on the second pension pillar, emphasizing its growing importance as a complement to the first pillar due to demographic challenges. It outlines the structure and incentives of the second pillar, including mandatory and voluntary pension insurance options, tax reliefs, and diversified investment strategies, highlighting the need for funded savings to sustain retirement income.