Social security – SWI

© Keystone / Gaétan Bally

Switzerland has a social security network that covers risks in many areas – work, health, family and old age.

This content was published on September 8, 2022 – 15:04

The Swiss social security system is not easily comparable to that of other countries, as it includes a variety of insurance schemes with very different mechanisms. Its financing is characterized by a relatively low use of tax revenues, a concentration on individual pension schemes and the influence of private institutions.

Moreover, the Swiss federal system and direct democracy shape social policy, generally slowing down the introduction of certain types of aid, but sometimes also speeding up processes. For example, disability insurance was introduced in 1960 following several popular initiatives calling for such a scheme, while maternity leave was introduced only in 2005, after being rejected by voters.

By international standards, Swiss social expenditure as a percentage of GDP is close to the European Union average.

old-age allowance

The Swiss pension system is based on three levels or “pillars”: a compulsory public pension scheme (old-age and survivors’ insurance), occupational pension schemes and private pension schemes.

The amount of pension a person receives under the compulsory public scheme depends on the number of years of contribution and his level of income. The objective is to ensure that retirees can maintain a minimum standard of living. Anyone in financial difficulty can apply for additional state-funded benefits.

Disability insurance

It is a compulsory insurance, financed by contributions from employees, employers and the State through various taxes.

Benefits are paid to insured persons who cannot engage in gainful employment due to a physical or mental disability. This insurance also covers rehabilitation programs, which help people re-enter the labor market, as well as a full or partial pension.

Compensation for loss of profit

This insurance is also compulsory, with contributions shared between the employer and the employee. It partially compensates for the loss of earnings resulting from the performance of military, alternative civilian or civil protection service, or during maternity or paternity leave.

Since 2005, women have been entitled to 14 weeks of leave after the birth of their child, paid at 80% of their salary. Since 2021, men have been entitled to two weeks of leave after the birth of their child, paid at 80% of their salary.

Since 2021, parents who have to interrupt or reduce their professional activity to care for a seriously ill or injured child are entitled to 14 weeks of leave, paid at 80% of their salary.

Unemployment insurance

All workers in Switzerland who have not yet reached retirement age are insured against unemployment. The contributions are shared between the employer and the employee. To receive benefits, the unemployed person must:

– have been employed for at least 12 months in the two years preceding the application for benefits

– be domiciled in Switzerland and have a work permit

– be registered with the regional unemployment office

– be actively looking for a job.

Unemployment benefits typically amount to around 70% of the person’s average earnings over the last six months to a year. Insured persons with children can receive 80% of their average salary. Benefits are generally paid for a period of two years, although there are many exceptions.

Unemployed persons who have reached the end of their entitlement period can receive transitional benefits from the age of 60, in order to ensure that they maintain a decent standard of living until retirement.

Health insurance

Basic health insurance is compulsory for anyone residing in Switzerland. It is financed directly by the insured, who pay a fixed monthly premium to a private insurer. Anyone who has difficulty paying can apply for financial assistance (in the form of a subsidy) from the canton where they live.

Basic health insurance covers most health conditions, including doctor’s visits, childbirth, and critical illnesses. Most prescription drugs are also included in coverage.

Accident insurance

Employees are automatically insured by their employer against accidents at work and occupational diseases. If they work more than eight hours per week for the same employer, they are also insured against non-work related accidents.

Spouses at home, children, students and pensioners must take out accident insurance together with their basic health insurance. Freelancers are not legally required to do so.

Family allowances

The system of family allowances may vary from one canton to another. In general, it is financed by employers, the self-employed and the cantons.

Family allowances are intended to partially offset the cost of raising one or more children. Employees and the self-employed can apply for an allowance for each of their children up to their 16th birthday. They can also obtain an allowance for any child still in school, up to the age of 25.

Some cantons have also introduced a birth or adoption allowance.

Social well-being

People in financial difficulty and whose social insurance benefits are insufficient, or who have not been able to receive them or are no longer entitled to them, can apply for social assistance. Its objective is to guarantee a minimum standard of living for everyone.

Social protection is generally financed by municipal and cantonal taxes. It is regulated by the cantons and implemented mainly by the municipalities. How it works and the amounts paid can therefore vary greatly depending on your place of residence.

People in need of financial support should contact their regional social services office. Help is allocated on a case-by-case basis depending on the situation and the person’s needs. Social benefits are often paid to elderly people whose pensions are too low and to single-parent families. Other eligible beneficiaries include unemployed people who are no longer eligible for unemployment benefits and who have been unable to find a job, people with high debts and workers who do not earn enough money to support the needs of members of their household.

About 10% of the population living in Switzerland receives some form of social assistance in the broadest sense of the term: supplementary benefits to supplement their old-age pension, family allowances, housing assistance, advances on alimony and economic assistance. general to life.

System gaps

Despite the various social security systems in place in Switzerland, many people still fall through the cracks and can find themselves in a precarious situation. About a third of people entitled to social benefits do not ask for assistance.

The system is complex and many people are unaware of their rights. Information can be difficult to obtain, and relevant services are not always readily available. Many people feel guilty for asking for help and fear being stigmatized. Some cantons also require people to repay part of the aid granted once their situation has improved.

Foreigners also risk losing their residence permit if they become dependent on social assistance. Undocumented migrants and people in an irregular situation do not want to risk being arrested or deported by the authorities.

All these factors have led to an increase in the number of people in precarious situations in Switzerland in recent years: in 2020, 8.5% of the population lived in poverty, despite receiving social security benefits.

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