A fund member and their spouse or domestic partner can make an agreement to divide pension rights. When dividing pension rights, both partners agree to transfer a share of their entitlements to each other. The agreement must be equal and mutual - your partner must agree to the same proportional share and both individuals must take part in the agreement.
This resource is meant to equalize the overall entitlements between spouses or domestic partners. However, the result of the agreement may differ between individuals. You must consider how the agreement will affect you and your partner specifically before you apply.
- The division applies to entitlements that were earned during the period of marriage.
- The division does not apply to disability pension, spouse pension or child pension.
- You may transfer up to half of your entitlements.
- You may choose to divide pension entitlements or pension payments.
Division of pension entitlements
There are two different ways to divide pension entitlements. Firstly, you can make an agreement to divide entitlements that you have earned so far. Secondly, you can make an agreement to divide future entitlements from this point on. You may choose both in the application.
1. Dividing earned rights
Both spouses agree to transfer a share of their earned entitlements to each other.
- When the agreement has been made, each individual will have their independent entitlement.
- You may apply for the agreement before you begin receiving lifelong pension payments, no later than 65 years of age.
- The agreement is permanent. In the event of divorce, the division of earned rights will remain divided according to the agreement.
2. Dividing future rights
Both spouses agree to transfer a share of their future entitlements to each other, until the marriage or domestic agreement is terminated.
- Applies to future rights (that will be earned from this point on).
- In the event of divorce you must notify Brú Pension Fund of a change in circumstance.
- Entitlements that will be divided during the agreement will remain divided in the event of a divorce.
Divison of pension payments
When pension payments are divided, a share of the payments is divided between the two spouses. The agreement must be equal and mutual - your partner must agree to the same proportional share and both individuals must take part in the agreement.
Should the fund member pass, the division of payments will be discontinued. Should the spouse pass, the division of payments will be discontinued and the payments will be paid fully to the fund member.
- You can apply for a division of payments at any age, including after you have begun to receive pension payments.
- You are not required to submit a marriage history license or a health certificate when applying for a division of payments.
How to apply for the agreement
- One agreement is submitted to Brú Pension Fund.
- Both individuals must sign the agreement.
- Provide necessary documents: Marriage history certificate that proves the period of marriage that the agreement is based on.
- Provide necessary documents: Health certificate for both parties (not neccessary when dividing pension payments).
- If the agreement is proved to be valid, that is, all neccessary documents are provided and a company doctor has declared no health risks to life probability, the agreement will be forwarded to other relevant pension funds.
Applications
Agreement to divide pension entitlements
Agreement to divide pension payments
Health certificate (to be filled out by a doctor)
Important to keep in mind
- Division of pension entitlement may not be the best choice if you have entitlements in B division funds (flat-rate funds) where spouse pension is lifelong.
- When you make the agreement with your spouse or domestic partner you waive all rights to the entitlements that are transfered to your partner. However, the division does not effect spouse pension or child pension.
- The agreement insures a better position for the individual with lesser rights in the event of a spouse's death.
Brú Pension Fund provides assistance
Should you require assistance, we at Brú Pension Fund are ready to help you with the making of the agreement. You can book a phone call here or book a meeting here at our office, Sigtún 42, 105 Reykjavík. Feel free to email us at lifeyrir@lifbru.is.