Employee insurance schemes
In the Netherlands, employees are automatically insured against disability, sickness, and unemployment. Contributions for these so-called social insurances are paid directly to the Tax Administration by the employer as part of the payroll tax. But for self-employed professionals, most of these social insurances are not required. You do not automatically build up a reserve for sickness or disability. You can take out insurance yourself to cover these risks.
Illness or occupational disability insurance
Do you want to receive an income if you fall ill or in case of occupational disability? You need to arrange for this yourself. You can set aside money for such instances or you can take out insurance:
- You can take out private occupational disability insurance.
- You can take out 'individual occupational disability insurance with collective conditions'. Several sector and professional organisations offer this option, as well as interest groups or associations for the self-employed.
- You can participate in a donation circle (schenkkring) for the first 2 years of disability. This is a fund set up by a (limited) group of self-employed entrepreneurs who put aside money each month. If one of them is ill for a longer period of time, they receive a monthly amount out of the fund.
- You can participate in 'crowdsurance'. This is a financial safety net that you set up with other entrepreneurs. In general, this is an online initiative. As with a donation circle, crowdsurance is based on trust and solidarity.
If you are self-employed and you become unemployed, in general you will not be eligible for unemployment benefit (werkloosheidswet, WW). Do you have to end your business because it is no longer viable? You can apply for social benefit options under the Decree on Social Assistance to the Self-Employed (Besluit bijstandverlening zelfstandigen, Bbz).
Insurances through UWV
Former employees or benefit recipients in the Netherlands who start their own business can take out several insurances with the Dutch Employee Insurance Agency (UWV). They can take out insurance against loss of income due to illness, insurance against loss of work, or occupational disability insurance. To be able to do so, they need to register within 13 weeks after their compulsory employee insurance scheme through former work or benefit has been cancelled.
Those who start a business after not having been able to work due to illness or disability for 2 years or more can apply for a voluntary occupational disability insurance (WIA) with the Employee Insurance Agency (UWV). Read more about occupational disability insurance (in Dutch).
Are you expecting a baby? You can apply for a maternity allowance (ZEZ) to UWV.
Everyone residing or working in the Netherlands builds up a basic state pension, the general old age pension, AOW, to which they are entitled when they reach state pension age.
If you want to build up more pension, you should take care of this yourself. There are several ways to supplement your pension. In some cases you can still make use of a former employer’s pension scheme. You can also choose to save, for instance via a retirement annuity contract or making use of a retirement reserve.
For some entrepreneurs there are (mandatory) sector or occupational pension funds.
Additional survivor’s pension
Your partner and children are not automatically entitled to a survivor’s pension. If you want to make sure your family will not suffer financially, you can for instance take out a life insurance. You can also choose to save or invest to create a financial buffer.
Every freelancer/self-employed professional can take out voluntary (business) insurances against a number of business risks with an insurance company. This is not mandatory.