Five ways YEL insurance affects social security
Are you self-employed? Do you want to understand your social security better? You've probably heard that YEL income is the foundation of your basic security – but what does that mean? Below you will find five situations in which YEL insurance offers your security.
Keep in mind: It all starts with YEL income
YEL insurance affects your social security through YEL income, which refers to the monetary value of your work input. Your insurance payment as well as the level of your social security are calculated based on it. Roughly put: the higher your YEL income, the better your social security. Read more about YEL income »
1. You fall ill
If you get sick, you can apply for a sickness benefit from Kela. You will start receiving it after only one day of sickness. The amount of your daily sickness allowance depends on your YEL income.
Example: How much sickness allowance would I get?
| YEL income | Sickness allowance / month |
| €8,262 | €742 |
| €20,000 | €1,167 |
Read more about the entrepreneur's sickness allowance on Kela's website (kela.fi) »
Read more about YEL income and falling ill »
2. A new family member arrives
As an entrepreneur, you can take family leave just like employees. The amount of parental allowance you receive from Kela depends on your YEL income. Kela now offers the following allowances during the family leave period:
- pregnancy allowance
- special pregnancy allowance
- parental allowance
- partial parental allowance.
These allowances will also increase your future pension. After family leave, it is possible to receive other childcare subsidies from Kela.
Example: How much parental allowance would I get?
| YEL income | Parental allowance / month |
| €8,262 | €742 |
| €20,000 | €1,167 |
Read more about entrepreneur's parental allowances on Kela's website (kela.fi) »
Read more about childcare support on Kela's website (kela.fi) »
Read more about entrepreneur’s family leave »
3. You become unemployed
You can receive an unemployment benefit if your business activities end, or you no longer work for your company for some other reason.
If you are a member of Entrepreneur Fund
In this case, you are entitled to an earnings-related daily allowance paid by the Entrepreneur Fund (yrittajakassa.fi) as long as you fulfil the work requirement (kela.fi). You can become a member of the fund if your YEL income is at least €13,573 in 2022.
If you are not a member of Entrepreneur Fund
You can apply for a basic daily allowance from Kela. You can get it if you meet the work requirement and your YEL income is at least as much as the lower limit of unemployment, in 2022 €13,573. If you don’t meet the conditions of basic daily allowance, you can apply for a labour market subsidy from Kela. It is a means-tested benefit.
Example: How much would I receive in earnings-related or basic daily allowance?
| YEL income | Earnings-related allowance / month | Basic daily allowance / month |
| €8,262 | €0 | €0 |
| €20,000 | €1,158 | €742 |
Read more about the end of entrepreneurship on Kela's website (kela.fi) »
Read more about entrepreneur unemployment »
4. You can no longer do your work
YEL insurance also brings you cover for disability. If your health deteriorates to the point that it hinders your work, you can apply for vocational rehabilitation. It aims to shape your business so that it fits your health – thus allowing you to continue your work as an entrepreneur.
For an entrepreneur, vocational rehabilitation is most often a work experiment that you do in your company. However, it can also be training or if you can no longer continue as an entrepreneur due to your health condition, it can be studying or training for a new profession.
You will receive rehabilitation allowance or a cash rehabilitation benefit and increment during your rehabilitation.
Read more about the vocational rehabilitation of an entrepreneur »
5. You are ready to retire
YEL insurance brings you a pension, of course. Your pension is based on all your earnings during your career in paid employment and as an entrepreneur. As an entrepreneur, your pension accrues based on your YEL income – 1.5% of your annual YEL income. (The exception is those aged 53 to 62, for whom 1.7% of YEL income will be accrued in pension between 2017 and 2025.)
In addition to old-age pension, you have the option to go on partial early old-age pension. If your ability to work is reduced, you can apply for a disability pension or a career pension. Your family is safeguarded by YEL in the form of a survivor's pension.
Read more about pension for entrepreneurs »
Keep in mind: accidents
Accident insurance is voluntary for an entrepreneur, but if you have one, the compensation paid by the non-life insurance company will be based on your YEL income.
Try the YEL calculator
Maybe you're wondering what the level of your own social security is. For a convenient estimate of it, try the YEL calculator. It allows you to study the impact of YEL income on your social security.
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