Dutch insurances & pensions are not mandatory. But most businesses want to insure their Dutch employee benefits (pension, illness en disability) and their business risks. Below you find a summary of some aspects of the Dutch insurances and risks in the netherlands.
General liability insurance
Business owners obtain general liability insurance to cover legal hassles due to accident, injuries and claims of negligence. These Dutch insurances safeguard against payments as the consequence of bodily injury, property damage, medical expenses, liability claim, slander, the cost of defending lawsuits, and settlement bonds or judgments required through an appeal procedure. This kind of Dutch insurances is not too expensive (relatively) and is an important business insurance; a no-brainer. These insurances are a part of the Dutch insurances & Employee Benefits.
Business owners providing services should think about having professional liability/ Indemnity cover (additionally acknowledged as errors and omissions insurance). This form of liability coverage protects your business against misconduct, errors, and negligence in provision of services towards your customers. Depending on your profession, you may be required by your government to hold such a policy. Professionals are often obliged to procure malpractice insurance as a stipulation of practicing in most countries. This Dutch insurances are a part of the Dutch Insurances & Employee Benefits.
How to start a pension scheme in The Netherlands
For the aspects of pension management, we will only focus on pillar 2 the employee benefits. There are a number of parameters that can be used to influence the retirement provision. The first are parameters with respect to the pension scheme. Secondly, execution parameters can be used to influence the level of the retirement provision.
Parameters for a pension scheme
The level of a pension depends on a number of parameters. These parameters can be seen as ‘controls’ that can be adjusted, and include:
- Contribution: the amount of paid contribution can vary.
- Benefit: the pension benefit paid to beneficiaries can be higher or lower.
- Accrual: more or less pension can be accrued.
- Retirement date: people can stop working and retire earlier or later.
- Risk: the level of risk that is taken with investing can differ.
- Indexation (target)/ inflation-proof pension. The amount of the indexation that will be paid can vary. The amount of indexation can depend on profit sharing.
- Guarantees: more or less guarantees can be granted.
Start pension contract
Pension commitments are agreed between employer and employees. In the Netherlands organizations of employers and sometimes unions make the agreements together with AFM-registered pension advisors. After the agreement has been made, the contract will be executed by pension institutions, like insurers or pension funds. The pension institutions do have influence on the aspects listed above. All these aspects affect the final pension to be achieved.
Contribution affects the active members. Indexation affects the sleepers and pensioners and possibly the active members. The best interests of all the people involved should be considered in the decision-making. In principle, an insurer cannot adjust the controls in the interim: an insurer must comply with the conditions in the contract. An insurance contract is agreed for a number of years. If the insurance contract expires of the legislation changes, the conditions can be adjusted again. Pension is a part of the Dutch Employee Benefits & Insurances.
Dutch disability benefits
If employee have been sick longer than 2 years and remain at least 35% disabled may apply for social security disability Dutch Insurances (WIA). There are several types of Netherlands disability benefits for disabled adults:
The Return to Work for Partially Disabled Persons (Werkhervatting Gedeeltelijk Arbeidsgeschikten, WGA) and IVA. The WGA is paid out to those who are 35–80 % disabled and will return to work, or when more than 80 % disabled but likely to recover. The IVA is paid to those who are at least 80 % disabled and may never return to work.
Full Invalidity Benefit Regulations (Inkomensvoorziening Volledig Arbeidsongeschikten, IVA). IVA disability benefits provide at least 75 % of the WIA monthly salary, but people are allowed to work and earn extra income to add to their benefits.
Wajong disability benefits are for those who, at the age of 18, already have a long-term illness or handicap; it also includes those that become disabled before the age of 30 and have followed a study program for at least six months. Recipients get 75 % of the minimum youth salary. The Participation Act was enacted in January 2015, meaning that only young people that cannot work in the future may apply for Wajong disability benefits.
Self-employed people must pay into an individual Dutch Insurance plan to receive disability benefits.
If you think I might be able to help you with your business
Gerrit-Jan Doorneweerd, registered Dutch Insurances & Employee Benefits,
Amsterdam, +31 (0)20 6200825
Mobile, 0651 471 9 – six – five. (Also in the evening or weekend)
Please give me a call