Health insurance: Optional daily allowance insurance

Optional daily allowance insurance covers the risk of temporary loss of earnings due to partial or complete inability to work as a result of an accident, illness or maternity. 

Two different insurance systems

• Daily allowances can be insured under two different Acts – the Federal Act of 18 March 1994 on Health Insurance (KVG; SR 832.10) and the Federal Act of 2 April 1908 on Insurance Policies (Insurance Policy Act, VVG; SR 221.229.1).
• Daily allowance insurance under the KVG is a form of social insurance offered by KVG insurers.
• Daily allowance insurance under the VVG is based on a private-law insurance policy. It can be offered by insurance companies as defined in the Federal Act of 17 December 2004 on the Oversight of Insurance Companies (Insurance Oversight Act, VAG; SR 961.01).
• KVG insurers can also offer daily allowance insurance under the VVG, since they are entitled to offer supplementary insurance as well as compulsory health insurance.

Daily allowance insurance under the KVG

• KVG insurers are required to provide daily allowance insurance under the KVG for individuals aged between 15 and 65 who live or work in Switzerland.
• KVG insurers must offer all policyholders the same level of daily allowance for the same length of time. Exclusions for existing conditions lapse after five years.
• These insurers pay daily allowances from an incapacity to work of 50% or more for at least 720 days within a 900-day period. Special provisions apply for pregnancy and childbirth.
• In individual insurance policies, the same premiums are charged for the same benefits. In collective insurance policies, different (more generous) benefits can be agreed, and premiums can be determined on the basis of the risk covered by each policy.
• If a policyholder has to change insurer when taking up or leaving employment, no new exclusions may be applied.
• Anyone who leaves a collective insurance policy is entitled to be transferred to an individual insurance policy with the same benefits as before.
• Unemployed policyholders are entitled to receive half the daily allowance in the event of incapacity to work of more than 25%, and the full daily allowance from more than 50%. In addition, if the premium is appropriately adjusted, unemployed policyholders are entitled to change their existing insurance to a policy under which benefits are paid from the 31st day.
• The KVG does not specify a minimum level of daily allowance that insurers must offer. Insurers are thus not obliged to offer applicants the level they require to cover the expected loss of earnings in the event of illness. Many insurers offer only a low level of daily allowance under the KVG. For this reason, many people obtain insurance for a higher level of daily allowance under the VVG.

Daily allowance insurance under the VVG

• Daily allowance insurance under the VVG is subject to the principle of freedom to contract. Insurers are therefore not obliged to accept applicants.
• Exclusions for existing conditions may be attached to the insurance policy for an unlimited period. In addition, certain disease risks can be excluded from the obligation to provide benefits.
• The level and duration of benefits can be freely agreed.
• The law does not guarantee the right to switch from one policy to another or to be transferred from collective to individual insurance. However, the provisions of the KVG concerning the protection of unemployed policyholders must also be observed in insurance policies under the VVG.
  

Employer’s obligation to continue salary payments

• For employees, the risk of loss of earnings in the event of illness is also covered by the employer’s obligation to continue salary payments as specified in the Code of Obligations and in jurisprudence.
• This obligation to continue salary payments very often leads employers to take out daily allowance insurance under the KVG or the VVG.
• The obligation to take out daily allowance insurance is usually also specified in collective labour agreements.
  

Documents

Evaluation and proposed reform of daily benefits insurance in case of sickness (in French) (PDF, 300 kB, 09.11.2016)

Legislation

832.10 Swiss Health Insurance Act (LAMal), title 3 (in French)

832.102 Ordonnance sur l'assurance-maladie (OAMal), Part 2

Last modification 16.04.2020