How is your family covered? Less than you think.

Many families believe that being married is enough for the surviving spouse to receive a pension, and that their children are protected by the same safety net as the parents. Neither is quite true. The Swiss system of the first pillar (AHV/OASI) and the second pillar (BVG) is generous in many respects, but its benefits depend on strict conditions: age, length of marriage, children, and whether you are employed at all. Below we look at the most common gaps we find when we analyse a family's pension situation, and at how a third pillar can close them.

There is often a belief that a spouse is automatically entitled to a widow's or widower's pension if their partner dies. In reality, the right depends on conditions set by law.

First pillar (AHV/OASI). A widow is entitled to a survivor's pension if, at the time of death:

• she has one or more children (regardless of their age), or
• she is at least 45 years old and has been married for at least 5 years.

For widowers the rules are stricter: under current law the pension is generally paid only as long as there are children under 18. The rules for widowers are being reformed, so it is worth checking the situation that applies to you at the time.

Second pillar (BVG). The pension fund pays a survivor's pension to the spouse if they must support at least one child, or if they are at least 45 and the marriage lasted at least 5 years. If neither applies, the BVG minimum is a one-off lump sum equal to three annual pensions. The BVG minimum survivor's pension amounts to 60% of the deceased's disability or retirement pension; many pension funds go beyond the minimum, which is why the certificate of your own fund matters.

A young couple without children, or a couple married for less than five years, can therefore find themselves with very little: no first pillar pension and only a lump sum from the second pillar.

Cohabiting partners are not entitled to any AHV survivor's pension, no matter how long they have lived together. In the second pillar, a partner receives benefits only if the pension fund's regulations provide for it, and usually only if the cohabitation has lasted at least five years or there are children in common, and the partner has been registered with the fund in advance.

The third pillar is one of the few tools that can protect a partner directly. In pillar 3a, the cohabiting partner can be named as beneficiary if the couple has lived together continuously for the last five years before death, or if the partner has to support one or more common children. In pillar 3b the beneficiary can be chosen freely.

Children who lose a parent receive an orphan's pension from the first pillar (40% of the corresponding old-age pension) and, if the parent was insured in a pension fund, from the second pillar (BVG minimum: 20% of the deceased's pension). These benefits are paid until the age of 18, or until 25 if the child is still in education.

For a family that depended on one main income, these amounts rarely cover the loss. Rent or mortgage, childcare and education costs remain, while household income can drop by half or more.

Children and students do not work, so they have no second pillar cover. If they become disabled before entering working life, they are considered "early disabled" and receive benefits only from the first pillar: an ordinary disability pension equal to 133⅓% of the minimum full pension. With the 2026 minimum pension of CHF 1,260 per month, this means about CHF 1,680 per month for an entire lifetime.

Early disability is something we do not think about, or do not want to think about. But it has serious consequences for the child's life and for the family's finances, often for decades. There are third pillar covers for children that address precisely this risk, usually at a low cost, but they must be put in place in advance, while the child is healthy.

The right solution depends on the family, but the building blocks are usually these:

• Death cover (risk life insurance) for the main earner, sized on the gap between the survivors' benefits from AHV and BVG and the household's real costs. A pure risk policy with a decreasing sum insured can be very affordable while the children are young.
• Disability cover in the form of an annuity or a capital, for each parent, so that the household does not depend only on the first and second pillar.
• Premium waiver: in an insurance third pillar, if the insured person becomes unable to work, the insurer continues to pay the premiums after a waiting period, so the savings plan reaches its target.
• Children's policies covering early disability and, if desired, building up savings for education.
• The beneficiary clause: making sure that the capital goes to the right person, especially for unmarried couples and blended families.

Anna and Marco, 34 and 36, are not married and have a two-year-old daughter. Marco earns CHF 95,000 a year, Anna works 50%. If Marco died today, Anna would receive no AHV survivor's pension, because they are not married; their daughter would receive orphans' pensions from AHV and from Marco's pension fund. Whether Anna receives anything from the second pillar depends entirely on the fund's regulations and on whether she has been registered as a partner.

In a case like this, a risk life insurance of a few hundred thousand francs, with Anna as beneficiary, and a disability cover for both parents change the picture completely, at a cost that is usually a fraction of a monthly salary per year.

Every family is different, and the gaps cannot be guessed: they come from your AHV contribution record, your pension fund certificate, your marital status and your children. That is why we always start with a pension analysis: we calculate the benefits you would receive from the first and second pillar in the event of disability and death, compare them with your income and expenses, and show you the gaps on a graph. Only then do we propose a third pillar sized on what you actually need.