The Swiss government has in principle agreed to cut the minimum interest rate guarantee for the pension and insurance industry to 2% from its current 3.25%, as of 2004.

The minimum gurantee, unique to the Swiss €366bn (($430.4bn) pensions market, has been hotly debated for the past few years. The downturn in equity market has left the insurance industry fighting for survival globally, but in Switzerland there is the extra burden of a minimum guarantee which they must pay to policyholders.