A man is standing next to a board stack.

YEL insurance

As an entrepreneur, you are statutorily obliged to take employment pension insurance under YEL if the following conditions are met:

  • You are 18–67 years old
  • You have worked as a self-employed person for more than 4 months
  • Your earned income from the entrepreneurial activities is at least 8,575.45 € in 2023 (8,261.71 € per year in 2022).

Even in these cases when you are engaged in part-time or light entrepreneurship and you meet the above conditions, you need to take YEL insurance. To avoid being liable to pay an increase for neglect, the entrepreneur must take out an YEL insurance within six months from the date when the extent of the entrepreneurial activities has become such that the obligation to insure is met. Please note that YEL insurance cannot be replaced by a voluntary pension insurance policy.

The YEL income is equal to your work input. The monetary value of your work input as an entrepreneur is comparable to the salary that would be paid to an employee with the same professional competence as you have. Your social security is based on your confirmed YEL income. 

Your YEL insurance guarantees an income in case you fall ill or become disabled or unemployed. That’s why it’s important for you to have your YEL income at the proper level right from the start. If any changes occur in terms of your work input, it is in your best interest to change your YEL income accordingly. Such changes can be done anytime, but not retroactively. 

The annual YEL contribution can be paid in instalments; you can choose to pay on a monthly basis, every two months, four times a year, twice a year or once a year. 

Are you a self-employed person, a shareholder or a partner insured under YEL?

According to YEL legislation, you are considered an entrepreneur if you are:

  • A part-time or light entrepreneur
  • A professional practitioner, i.e., a sole trader
  • The spouse of a professional practitioner/sole trader
  • Other family member of a professional practitioner/sole trader, living in the same household and engaged in unpaid work at the company
  • A partner in an open partnership
  • A general partner of a limited partnership
  • A shareholder with a leading position in a limited liability company who owns, alone, more than 30 per cent of the company shares or votes, or, jointly with family members, more than 50 per cent of the company shares or votes, either directly or indirectly via another company
  • A shareholder or partner in another entity or organisation who is personally accountable for the activities
  • A self-employed person (self-employed without employees, professional practitioner, freelancer, beneficiary).