Artikkelit

YEL or TyEL? What do you get with pension insurance?

In Finland, work is always insured so that you will have strong social security to support you. When you pay for a pension insurance, you are saving for your retirement days and preparing for the future. Whether there is a need for this security tomorrow or in the future.

As an entrepreneur, you must take care of your own pension security by taking out YEL insurance. In the case of employees, it is the employer's responsibility to take out TyEL insurance for the employees. Based on these, everyone working in Finland is covered by pension security, whether they work as entrepreneurs or employees.

With your pension insurance, you accrue pension to which you are entitled when you reach the lowest old-age retirement age specific to you. Then at the latest, you will receive concrete benefits from the pension you have paid. However, pension security also covers much more before your actual retirement age. This may mean, for example, disability pension or vocational rehabilitation if your ability to work decreases, or a survivors’ pension for your family in the event of your passing away.

At the same time, Finnish pension cover will help you even if you move out of Finland. In such a case, you can still apply for the earnings-related pension accrued in Finland as part of your monthly pension when the time comes.

Find out how to apply for pension from abroad.

Which insurance is correct for me: YEL or TyEL? 

The public sector is governed by its own pensions act, and there are several different laws in the private sector based on which work is insured. Every employee in the private sector is insured under the Employees’ Pensions Act (TyEL). The TyEL insurance contribution is paid by the employee and the employer together, and it is the employer’s responsibility to obtain the insurance.

All self-employed persons are insured under the Self-employed Persons’ Pensions Act (YEL). The entrepreneur must take out YEL insurance for themself, and the amount of the YEL contribution is based on their YEL income. 

Pension insurance is mandatory and cannot be replaced by other voluntary insurance policies. Next, we will discuss how these two ways of insuring work differ from each other. 

YEL is an entrepreneur’s most important insurance

When you pay your YEL contribution, you are accruing your pension and providing yourself with strong social security. The size of the YEL contribution has a direct impact on the amount of sickness allowance in case you fall ill or the amount of parental allowance you receive if you decide to stay off work to care for your children.  

Through YEL insurance, the confirmed YEL income affects not only the self-employed person’s pension coverage but also the amount of sickness allowance and parental allowance. If an entrepreneur falls ill and has to stay off work, Kela will pay a sickness allowance. The amount of sickness allowance is based on the entrepreneur’s annual confirmed income. In other words, the amount of sickness allowance is calculated based on the YEL income of the YEL insurance.

So this is not just an insurance policy for your old age. The YEL insurance also secures livelihood in the event of a disability or a family provider passing away. If you are a member of the Entrepreneur Fund, your earnings-related unemployment allowance is also based on your YEL income. In this way, the size of the YEL contribution has a direct effect on how strong your livelihood is in a situation where you are unable to work.

When do you need YEL insurance? 

Example: Jouko works as a photographer. He determines how much he charges his customers and whether he accepts photography jobs. Jouko does not have an employment relationship or a supervisor. Jouko himself agrees on the terms of employment with each of his customers. Jouko must take out a statutory, mandatory YEL insurance policy. 

YEL insurance is mandatory when 

you work without an employment relationship and do not have an employer, 
you are between 18 and 67 years old (68 years in 2026), 
you work as a self-employed person for at least 4 consecutive months and
your estimated confirmed income exceeds the minimum annually determined limit.

You can read the instructions for determining YEL income here. Please note that the larger you determine your YEL income to be, the more robust your financial security will be in case you become unemployed, fall ill or retire.

TyEL is more than just an invoice

TyEL insurance is also about preparing for unexpected situations. When you pay a TyEL contribution from your salary, you are accruing both your pension and other social security. The accumulation of the earnings-related pension enables you to, for example, receive a disability pension or support for vocational rehabilitation. In addition, your pension cover provides financial security for your family in case you as a provider pass away. Earnings-related pension cover is not just for retirement, but to prepare for unpleasant surprises of life. 

When should TyEL insurance for an employee be taken out? 

Example: Minna works in a restaurant. The employer pays her a monthly salary and determines when, where and what kind of work Minna does. Minna works in an employment relationship. In such a situation, the employer must take out TyEL insurance for Minna. 

TyEL insurance is mandatory when 

you work in an employment relationship, 
you are between 17 and 68 years old and
you are paid a wage of at least €70.08/month (2025). In 2026, this amount is €71.72/month.

As an employee, you can find out whether your TyEL insurance has been taken out by checking your payslip and regularly monitoring your earnings-related pension statement. The amount of the pension insurance contribution is calculated from your annual earnings, so if your annual earnings are correct in your earnings-related pension extract, your employer has appropriately taken out TyEL insurance for you. 

As an employee, you pay about one third of your earnings-related pension contribution. You can see the amount on your payslip, as your employer withholds your share from your salary. The employer pays the remainder of the earnings-related pension contribution and also pays your share to your earnings-related pension insurer. 

As an employer, remember that you need TyEL insurance for both yourself and your employee. Please note that you must take out the insurance as soon as you pay a wage to at least one employee.

When you have an insurance contract with us, you will use the insurance number stated in your contract and our online service. In case you don't have a contract with us, you may use Ilmarinen's insurance number 46-3000000V.

How do you take out YEL or TyEL insurance?

The most convenient way to manage insurance matters is through our online service. You can find more information on both the self-employed person’s YEL insurance and the employer’s TyEL insurance on our website. 