There are commonly two types of Pillar 3a. The insured Pillar 3a and the non-insured Pillar 3a.

The main differences between the two (other than the insurance element) are:

• With a non-insured Pillar 3a, you decide how much you pay in each year
• With an insured Pillar 3a, you have a pre-agreed contribution rate that you are obligated to pay and there is often no flexibility to change this

Whilst it may seem as though flexibility is the better option to go for, there is something to be said about the discipline that ensures you pay into your Pillar 3a every year. 

The default option provided by Patterson Mills is a non-insured Pillar 3a. However, where it is relevant and suitable, we are able to organise an insured Pillar 3a, too. 

The best choice is the often one that is most suitable for your circumstances.

You may find that there are enhanced investment options available with non-insured options, though equally may prefer the insurance aspect that you receive from an insured Pillar 3a.

When you open an insured Pillar 3a solution, you enter into a contract with an insurance company. You may even have a policy that comes with a guarantee. For example, an offering of a guaranteed minimum interest rate on your savings.

Cancelling or transferring a non-insured Pillar 3a will often be much easier than an insured Pillar 3a that may have associated early termination fees. It is important to always read the contracts with which you are provided before signing.

Fortunately, you are not limited to only one Pillar 3a account, and it can even be in your interests to open a new Pillar 3a account when your previous one reaches roughly CHF 50’000.-. 

Doing so will likely be easier to organise with a non-insured Pillar 3a. However, Patterson Mills will always check with both the non-insured and insured Pillar 3a Providers to ensure your needs are met with the most flexibility available.