Registered Pension Plan (RPP)

The Registered Pension Plan (RPP), also called the Supplemental Pension Plan in the Quebec province, allows the employer to offer employees some financial security upon retirement. This particular plan works within a very specific legal framework.

The more formal nature of this plan encourages employees to remain with the company. In today’s environment where employers are faced with an extremely competitive labour market, employee loyalty has become a crucial factor.

The RPP comes in two formats: the defined benefit plan and the defined contribution plan.
The defined benefit plan generally sets the amounts employees will receive when they retire or the calculation method of these amounts. In most plan regulations, the employer is responsible for making up any plan deficits so that the provisions for pension payments are respected.

In the defined contribution plan, the employer’s participation is set ahead of time, usually on the basis of a percentage of salaries, and attributed individually to each employee. The amount employees will receive at retirement corresponds to the amounts accumulated in their accounts and the investment income involved.
Given the particularities of the legislation regulating this type of plan, you may wish to contact one of our consultants for more detailed information.

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