2. Getting Started

2.6 Structure of the social security system

Switzerland has a solid and effective social insurance network, providing all persons who live and work here ample cover against risks whose financial consequences they may find hard to face on their own.

The Swiss social security system is organised in five sections:

• Retirement insurances (consisting of three pillars), that is
  
  • First Pillar (compulsory): it guarantees benefits to pensioners, the disabled, and survivors
  • Second Pillar (compulsory only for citizens on a regular and fixed income in Switzerland): occupational benefit plan
  • Third Pillar (optional): savings scheme on a fixed deposit account, subject to tax relief (available exclusively to Swiss residents)
• Insurance against the consequences of a disease or accident (i.e. Health Insurance).
• Compensation for loss of earnings to citizens discharging military or community service duties, or mothers on maternity leave
• Unemployment insurance
• Family allowances

The insurance cover provided by these insurance plans consists in the payment of benefits such as pensions, compensation for loss of earnings or family allowances, or in the reimbursement of expenses caused by disease or accident.

Background information: Funding of the social security

The benefits paid out by the various insurance branches are funded primarily on the basis of social security contributions deducted from salary. Employers participate in the financing except for health insurance. In this case, each insured person pays his/her own premium (see also 2.5 Health Insurance). The state also participates by co-funding the social securtiy schemes except for the occupational benefit plan.