Associate Professor Xue Huiyuan, deputy director of the Social Security Research Center of Wuhan University, and his collaborators published a paper entitled "Comprehensive Replacement Rate, Desirable Replacement Rate and Moderate Replacement Rate Interval of the Three-pillar Pension Insurance System" in the second issue of the CSSCI journal Insurance Research in 2023.

【author】Xue Huiyuan，Hu Haoran，Luan Yiqing

【Published Journal】《保险研究》

【Journal level】CSSCI

【Publication Time】Issue 2,2023

【Abstract】Through the theoretical definition of the basic living needs of urban residents, this paper concludes that the lower limit of the agreed replacement rate of pensions to meet the basic living needs of urban retirees is 43.7%, and with reference to the suggestions of the academic community on the upper limit of the agreed replacement rate, the range of the agreed replacement rate of pensions in the three-pillar pension insurance system is determined [43.7%, 70%]. By constructing an actuarial model, the comprehensive replacement rate of pensions under different combinations of the three-pillar pension insurance system is calculated under optimistic and pessimistic conditions, and compared with the agreed replacement rate, and then the appropriate level range of the pension replacement rate under the three-pillar system is found. The results show that low-income people can meet their basic living needs by participating in the first pillar, but they must pay for a certain number of years, and the middle- and high-income groups need to expand the second and third pillars as supplements. Participation in the second and third pillars can significantly improve the level of comprehensive replacement rate of pensions, and participation in the second pillar has a greater complementary effect on the first pillar than participation in the third pillar. The moderate level range of the pension replacement rate under the multi-pillar pension insurance system gradually expands with the increase of the number of years of payment, and finally remains unchanged at the level of [43.7%, 70%]. In the optimistic case, the retirement age is 60 years old, and the individual contribution salary base is always equal to the average salary of the previous year's full-caliber "standard people" to participate in the first, second and third pillars as an example, there is no appropriate range when the payment period is 15~19 years, the moderate range of the replacement rate is expanded from [43.7%, 46.9%] to [43.7%, 68.6%] when the payment period is 20~25 years, and the payment period is more than 26 years, and the moderate range of the replacement rate has always remained at the level of [43.7%, 70%]. Based on this, this paper puts forward some suggestions such as delaying the retirement age, increasing the minimum payment period, reducing the pension insurance rate, taking multiple measures to increase the income of the pension insurance fund, strengthening the investment and operation of the fund, and increasing the development of the second and third pillars.

【Keywords】 three-pillar endowment insurance; target substitution rate; Desirable substitution rate

【Funds】 2022 Research Project of Insurance Institute of China "Research on the Appropriate Level of Pension Replacement Rate in the Three-Pillar Pension Insurance System" (Grant No.: ISCKT2022-N-1-01)