Social Security and Welfare Benefits in Panama

Understand the cover, contributions and entitlements of the social welfare system in Panama…

The social security system in Panama is run by the Ministry of Social Development (Ministerio de Desarrollo Social - MIDES). The Social Security Office is the public institution in charge of the administration of national insurance programs for pensions, health, unemployment, and labor accidents and injuries.

The social insurance system applies to both the private and public sectors. Contributions are paid by both employees and employers.

Self-employed workers can choose to make voluntary contributions. Foreigners working for a company based in Panama are also covered.

Retirement Benefits

Retirement benefits are granted to all residents and citizens of Panama who are of a certain age. Men can claim these benefits at 62 years of age, women at 57.

Those in receipt of a government pension and holders of a retirement (pensionado) visa are also entitled to a number of benefits which include:

  • 50 percent reduction on entertainment anywhere in Panama (movies, theaters, concerts)
  • 30 percent reduction on bus, boat and train fares
  • 25 percent reduction on airline tickets
  • 50 percent reduction on hotels from Monday to Thursday
  • 25 percent reduction on hotels from Friday to Sunday
  • 25 percent reduction in sit-down restaurants
  • 15 percent reduction in fast food restaurants
  • 15 percent reduction on hospital bills (if no insurance applies)
  • 10 percent reduction on prescription medications
  • 20 percent reduction on medical consultations
  • 15 percent reduction on dental and eye exams
  • 20 percent reduction on professional and technical services
  • 50 percent reduction on closing costs for home loans

Health Insurance

Government healthcare is available to permanent residents and citizens of Panama; however the support that is provided is nominal and most Panamanians prefer private healthcare as is it so affordable, even by local standards. The standard of medical provision and comfort afforded by state services in public hospitals is also likely to be lower than that in the private sector.

Many foreign residents of Panama opt to buy international health insurance that covers them whichever country they are in. It is also possible to live in Panama without any insurance and to simply pay the full cost of any medical treatment.


There are no unemployment benefits available for unemployed people in Panama.

Maternity Leave

The law in Panama regarding maternity leave allows the mother three paid months off work. Typically this is divided into six weeks' leave before the due date and six weeks after the birth, although the mother has the option to take the leave on her own schedule. There is no law regarding when the employer must be told about the pregnancy.

Disability Benefits

People born with a disability in Panama are not legally entitled to any government support or benefits. However, the government does provide care to those who develop an infirmity over the course of their life.

Any support groups that offer benefits are private; there are no government or state programs or initiatives to care for handicapped or disabled people.

The Goodwill in Panama Association (Asociación Panameña de Industrias de Buena Voluntad) provides programs, training and help with integration for people with disabilities in Panama. It also offers workshops and technical courses to help people with disabilities gain employment.