What are the benefits of YEL insurance?

How does YEL insurance help if I become ill?

Your YEL income determines the amount of sickness allowance paid by Kela. The higher your YEL income, the better your financial security if you fall ill.

Example

An entrepreneur is unable to work for several months due to a serious illness. Their YEL income is €30,000 per year, which means they receive almost €70 per weekday in sickness allowance from Kela.

Without YEL insurance, the entrepreneur would only receive the minimum allowance, which is about €30 per weekday.

How does YEL insurance help if I become unemployed?

As an entrepreneur, you can receive unemployment benefits either from an entrepreneurs’ unemployment fund or from Kela. Your YEL income determines the level of your unemployment security.

You are entitled to earnings-related unemployment allowance paid by the Entrepreneurs’ Unemployment Fund if you are a member of the fund and meet the so‑called employment condition.
Read more about the employment conditions.

Example

An entrepreneur’s work comes to an end and they become unemployed. Their YEL income is €20,000 per year, which means they receive €1,190 per month in earnings‑related unemployment allowance from the entrepreneurs’ fund.

How does YEL insurance protect your family in the event of death?

The pension you have accrued through YEL insurance affects the survivors’ pension paid to your family. A survivors’ pension can be paid to your spouse and/or children.

The more pension you have accrued, the higher the pension your spouse and underage children may receive. YEL insurance helps provide financial security for your family even after your death.

Example

A self‑employed single parent with two children passes away. They have accrued an earnings‑related pension of €800 per month.

Both children are entitled to a children’s pension of €400 per month, paid until they reach the age of 20.

How does YEL insurance compare to saving or investing?

YEL insurance cannot be compared to saving or investing. YEL is an insurance that protects you in many different life situations, such as during parental leave or if you fall ill.

For example, if you become ill, YEL insurance with a reasonable YEL income ensures you receive a meaningful sickness allowance. The sickness allowance you receive does not reduce your future pension, whether you are ill for a few days or for several months. 

Without YEL insurance, and if you relied only on personal savings for your retirement, you might have to use those savings to cover your living costs during illness.

Do I pay more in YEL contributions than I get back?

As with any insurance, this cannot be known in advance. It depends on the length of your life and the turns it may take.

If you were to assess the “return” of your YEL insurance by comparing the pensions you receive to the contributions you have paid, the key factors would be the age at which you retire and your expected lifespan. Statutory insurance exists precisely because few of us know in advance whether we will become unable to work—or when our life will end. Insurance spreads life’s risks among all those insured.