Insurance in Switzerland
Insurance is very important for your move to Switzerland. Make sure you understand the system...
There are basically two types of insurance available in Switzerland; they should be clearly differentiated: obligatory insurance, which is compulsory for everyone, and voluntary insurance, which is taken out to cover specific risks.
The following types of insurance are compulsory in Switzerland:
- Health and accident insurance
- Insurance for motor vehicles and bicycles
- Old age and surviviors insurance (AHV)
- Disability insurance (IV)
- Insurance for loss of earnings (EO on the payslip)
All residents of Switzerland regardless of their age are subject to the health insurance law (KVG in German). Under this legislation everyone has to take out obligatory health insurance for basic medical treatment, drugs and cover for inpatient treatment in a general hospital ward.
Citizens of other countries who remain in Switzerland for more than three months or settle there are also subject to this condition. Health insurance must be taken out within three months of entering Switzerland; newborn babies also need to be insured within this period.
All health insurers provide the same benefits under the obligatory insurance plans, but not for the same premiums, so it is recommended to compare the premiums offered and change insurance if necessary.
Those requiring more than just basic treatment will need to take out supplementary insurance to cover the cost, for example for a private ward or for dental treatment, both of which, in contrast to some other countries, are not covered by obligatory insurance.
Employers are obliged to insure their employees against occupational and non-occupational accidents. Employers pay the premiums for occupational accidents; employees pay those (maximum two percent of their wages) for non-occupational accidents. Children and individuals who are not gainfully employed can get accident cover included in their health insurance or take out separate accident insurance
Third party insurance is compulsory for all motorised vehicles. Vehicle owners can choose whether to insure against fire and theft or to take out comprehensive insurance.
Old age and survivors' insurance (AHV)
The AHV is a general state insurance, compulsory for all individuals resident or employed in Switzerland. Contributions are payable from 1 January of the year after the twentieth birthday to retirement age. Individuals who are gainfully employed before their twentieth birthday are obliged to pay contributions from 1 January of the year following their seventeenth birthday. Contributions are divided equally between the employee and employer and amount to 8.4 percent of the salary. Self-employed persons pay 7.8 percent of their income directly to their local compensation fund.
Invalidity insurance (IV)
The Swiss Invalidity Insurance (IV) is a further compulsory nationwide insurance. The insurance assists disabled people with rehabilitation or provides subsistence payments. Contributions to the IV amount to 1.4 percent of wages and are divided equally between the employee and the employer.
Income replacement scheme (EO)
The income replacement scheme is a compulsory insurance for all individuals in Switzerland. Those serving in the Swiss Army or doing alternative civilian services are indemnified for loss of earnings via this scheme. Both employers and employees contribute 0.3 percent of their wages to the EO.
Unemployment insurance (ALV)
Employees are compulsorily insured against loss of income through unemployment. Again, both the employee and your employer share in paying 2 percent of their salary; the payment is deducted directly from wages. Self-employed persons have to take out private unemployment insurance.