COVID-19, Latest Developments and Practical information concerning the FCT Group

Maintaining our services

On March 19th we informed you that FCT Services SA and Trianon SA had both taken the necessary measures to ensure that, even at this challenging time, services are available at the local level and the interests of insureds and their employers are protected.  You can reach your contacts by e-mail or telephone during office hours, although the response time may be slightly longer than usual. In general, we would ask you to correspond by e-mail rather than by post.

Unfortunately, personal appointments and face-to-face meetings with insureds, affiliated companies and partners at the offices of FCT Services SA or Trianon SA are no longer permitted, until further notice. However, thanks to new technologies, both of them can offer you videoconferencing or a conference call.

Your support and understanding will be greatly appreciated. 

Financial markets

The exceptional returns generated in 2019 reinforced the financial situation of the FCT’s Pension Funds as well as that of the insureds of the FCT 1e. Unfortunately, the sharp sell-offs in equities, widening spreads on corporate bonds, and steep falls in real estate funds over the last few days have eroded the reserves and performances achieved last year.

Uncertainty and volatility will no doubt continue to dominate the markets for some time. Nevertheless, it is essential not to give in to panic and to hold to the long-term investment strategy devised in less turbulent times on the basis of objective analyses.

During this particularly challenging period, we are maintaining regular contact with the members of the Pension Committees, the insureds and our partners.

Payment of pension benefits

Payment of retirement and risk (disability and survivors’) benefits is guaranteed.

Within the FCT Group, the risk benefits are integrally covered by Swiss reinsurers that are subject to regulation and supervision by FINMA, and as such are financially very sound. The payment of these benefits therefore does not entail any disposal of investments. 
In the current situation, where face-to-face contacts are strongly discouraged or even prohibited, the authentication of signatures, required by law for the payment of lump-sum benefits, is more difficult. We recommend that insureds submit their application to Trianon SA, ideally by e-mail or telephone. Our partner will discuss concrete details and the urgency of the payment with the applicants, in order to find the best possible solution.

Payment of contributions

In accordance with Article 66(3) of the Occupational Pensions Act, the employer must continue to deduct employee contributions when the salary is paid, even in the case of short-time working. The employer must then remit its own contributions and those of the insureds in accordance with the applicable regulatory, contractual and statutory provisions.

However, in view of the current situation, extensions of due dates and temporary suspension of payments (e.g. for 60 days) are possible on a voluntary basis. In such cases, a written agreement between the employer and the FCT is required.

With regard to the plans with individual investment choice – the so-called “1e” plans - it is essential that employers continue to pay all the monthly contributions according to the terms of the contract, so as not to disadvantage the insureds who bear the risks or benefits of the investment opportunities.

Payment of contributions via the employer contribution reserve (ECR)

The Federal Council recently decided that employers may, temporarily, use the employer contribution reserves (ECRs) they have built up in their Pension Fund not only for the payment of their own contributions but also for the payment of employee contributions. If a Pension Fund has an ECR, this measure should make it easier for the Affiliated Company  to overcome any cash flow problems. This measure does not affect employees, as the employer deducts the employee share of the contributions from salaries as usual, and the aggregate contributions are then debited from the ECR account within the Pension Fund.

Moratorium on debt proceedings

For the first time since 1914, the Federal Council decreed a nationwide moratorium on debt proceedings, in accordance with Article 62 of the Debt Proceedings and Bankruptcy Act. This moratorium is valid until 4 April 2020. After that, the suspension of proceedings during public holidays (i.e. 7 days before and after Easter), provided for under the Act, will apply. This means in fact that no debt collection or debt proceedings can be undertaken in Switzerland before 19 April 2020.

Death and disability reinsurance

Finally, the FCT Group will not impose any exclusions on medical grounds or exclude anyone from insurance on the grounds of this coronavirus pandemic. For your information, the FCT Group’s reinsurers (AXA, Mobilière and Zurich) also apply this practice. Regulatory benefits are still guaranteed under matching reinsurance contracts irrespective of the pandemic, so no additional provision will be necessary.

Contacts and questions

Your FCT and FCT 1e advisers and your technical managers are on hand to answer your questions and provide support in case of specific requests.

They will gladly set up a videoconference or conference call with you at your request.

We would like to thank you for your continued support, your patience and your commitment over the coming weeks. Take care of yourselves and your loved ones, and stay safe!

Your Board of Trustees