When an employee is covered by a pension insurance program and retires, he or she qualifies to receive a lump sum or monthly payments. Pension insurance or schemes are designed to provide the retiree with an income. Most pension plans require the employee, employer, or both to make pension payments. Who makes the pension payments depends on the plan. For example, an individual plan, purchased by a working or nonworking person, requires payments directly from that person. An employer pension plan typically entails pension payments from both the employer and the employee. Sometimes the employer will match a percentage of the amount the employee contributes. With a union pension, it is more common for the employer to make all the pension payments. Pension payments are usually tax deductible in the United States.