Social security system is built on the principle of organization of a stock insurance fund. Social security is built on the following main pillars, which explains its meaning.
Zero pillar - social support and care for the most vulnerable layers of population - disabled, extremely poor people, unemployed, disadvantaged children.
Pillar - aims to ensure benefits and services to workers incapacitated during their period. To use these services and additional criteria are related to the mandatory continuous involvement of the insured in this system. Payments are the principle of solidarity. All involved, and receive only those for which the risk has occurred.
The second pillar - mandatory capital form of social security. Provides benefits and services again during incapacity. The size of the amount received depends on the individual account accumulations. Source of funding capital insurance funds.
Third pillar - voluntary capital form of social security is financed by voluntary contributions and their capitalization.
The fourth pillar - charity organizations, families and assistance from others.
Nature of social security
Social security is a mechanism which generates and distributes a special fund in the implementation of security risks.
The importance of the system consists in insurance funds to ensure the physical security of citizens in society on the occurrence of specified and covered by public funds risks. Instrument to settle the Social Security Social Security Code. This Code regulates public relations connected with:
1. state social insurance sickness, accident, occupational disease, maternity, unemployment, old age and death;
2. additional social security, which includes:
a) supplementary mandatory pension insurance for old age and death;
b) the additional voluntary pension insurance fund for additional voluntary pension insurance for old age, disability and death or the fund for additional voluntary pension insurance under professional schemes for old age;
c) additional voluntary insurance for unemployment and / or professional qualification.
Covered risks
Temporary disability and temporary reduced working - failing to pursue the work due to illness
Disease that sometimes leads to permanent disability
Maternity - a risk covered under 2 years old child
Age - a contingency that occurred irreversible biological processes
Disability - permanent disability.
Death
Unemployment - an economic risk
Employment accident and occupational disease - associated with the impossibility of obtaining employment income for objective health status. In both cases there are special programs designed to support and rehabilitation.
The collection of contributions and their redistribution is definitely the Institute. He is responsible for the allocation and spending of various types of payments occurred obey different risks. There is a system of control for this purpose are established rules, methods and indicators, which determine the degree of risk. NII with the Social Assistance Agency, Ministry of Labour and Social Policy implemented various programs \ time employment, retirement support, integration of people with disabilities. \ Occurred in certain social risks, which aims to better cover people who need them supporting defined activities.
Principles of social security
1. mandatory and universal provision;
2. solidarity of the insured;
3. equality and equivalence of the insured;
4. Social dialogue in managing the social security system;
5. Stock organization of insurance agents.
Financial models of insurance funds
Insurance funds are organized on the basis of capital cost roof and roof systems.
Characteristics of the roof system cost
Solidarity - to finance the current revenue generation not working
Predefined payments - everyone knows in advance how much you pay. Management state is completely absent or limited
Cost advantages of roof system - adaptable to the demands, easily administered, easily overcoming inflation shocks more independent and less influenced by the capital markets.
Disadvantages - weak self-interest and limited personal choice, strong dependence on the political situation.
Characterization of capital funded system
Investment and capitalization of contributions individualization of fund assets \ individual accounts \ pre-defined contribution and defined in advance payments, asset management market.
Benefits of capital funded system - clearly a personal choice and interest, right of inheritance funds in individual accounts, development of economy and capital markets, weak depending on the political situation.
Disadvantages - depending on inflation shocks and crises of capital markets, high administrative costs, high individual risk, risk of major fraud, requiring high investment culture of the insured.
Combining the two systems lead to the creation of two major systems of insurance:
System of compulsory state social insurance
System of supplementary mandatory pension insurance.
Of course, there are insurance funds for additional voluntary pension insurance, unemployment and / or professional qualifications, whose activity is regulated by law and the relevant access control, which the legislature has created to protect the insured and their families.
Functioning of the systems are regulated by the Social Insurance Code.
Actors of Social Security
Insured persons are divided into several groups according to Article 4 of the CSR:
Paragraph 1 - Insured persons for all contingencies
2 - Insured persons of disability, old age and death and accident
Paragraph 3 - Insured persons of disability due to sickness, old age and death
Social Security Code is defined subjects-assurance and self-insurers. The Code and accompanying regulations are spelled out clearly the rights and obligations and the subsequent liability insurers.
Insurer means any natural person, legal person or unincorporated, and other organizations have an obligation under law to make contributions to other individuals. Insurers have the following responsibilities: to each newly registered person to work as the post, salary, length of working day to submit contributions on time and in the correct amounts, to notify the NRA exactly which persons are covered and what risks covered, What% of the contribution / working in different categories of percentage is different for the employer for employees of the MoI and MoD are contributions to the state budget, but at the expense of additional insurance worker is /.
Self is a natural person who is obliged to make contributions entirely at their own expense. Contributions to the self employed are entirely at their expense, they make the annual adjustment.