Familiar to most entrepreneurs and light entrepreneurs, YEL, i.e. the Finnish entrepreneur’s pension insurance is a mandatory insurance, which an entrepreneur must get if his or her annual income exceeds at least € 7958.99 (in 2020) with work duration of at least 4 months. Find out more about the core facts of YEL!
There are many aspects to YEL which entrepreneurs might not be aware of. We gathered you some important facts about the Finnish entrepreneur’s pension insurance YEL.
Most entrepreneurs do not pay enough YEL
The fact how much you pay for your entrepreneur’s insurance directly affects the pension you’ll receive after your career. It also affects the additional security you can receive in the event of a disabling illness or accident. The amount of YEL impacts, for example, the amount of your sickness benefit.
When calculating the suitable amount of YEL, remember to include the YEL fee in the pricing of your services. For example, you can take your YEL costs into account in your pricing by multiplying your service fee with 1.25 to make sure you’ll have your health insurance and the YEL contribution covered.
Things you didn’t know about the Finnish entrepreneur’s insurance
Unfortunately, accidents can happen to all of us and they often happen when least expected. Sometimes an accident may even lead to disablement, preventing us from continuing as entrepreneurs or in our current work position.
However, as an entrepreneur you can add security by choosing the level of your YEL insurance, which affects the amount of rehabilitation allowance paid after an accident.
The level of earnings-related allowance is affected by your level of YEL insurance. By belonging to SYT, i.e. the entrepreneur’s unemployment fund, you have the right for earnings-related allowance 15 months after payment if you become unemployment.
A good rule of thumb is that YEL should be approximately 20% of your taxable income for it to guarantee you an adequate level of social security. Also note, that for entrepreneurs in Finland, the widow’s pension is also not available without taking an YEL insurance.
Did you know you can get additional insurances through Ninjou?
Reasons for getting voluntary entrepreneur insurances
- Affordable and comprehensive insurances incase of incapacity to work.
- They provide security for periods of 12 to 24 months if you fall ill or have an accident.
- For example, for about 300 euros a year, you can receive a daily allowance of about 50 to 60 euros for 12 months or a sum of EUR 40,000 for permanent harm, if it is due to an accident. Ask for more details from your insurance company. As you request an offer, let them know you work through a billing service without your own business ID.
- The daily allowance is paid in addition to Kela’s sickness allowance.
- Please note that your credit rating may affect your ability to get additional insurances.