Employee Insurance in Finland – What You Need to Know
Finland’s employee insurance system may seem complex when starting a business in the country. What insurances are mandatory for employers? How are the payments determined? What if the employee comes from abroad? We’ll go through the essential points you should be aware of.
Mandatory Insurances for Employers in Finland
In Finland, employers are legally required to arrange five basic insurances for their employees:
- Earnings-related pension insurance – to accumulate pension for the future
- Unemployment insurance – protection against unemployment
- Accident insurance – compensation for occupational accidents and diseases
- Group life insurance – protection in case of death
Employer’s health insurance contribution (SAVA) – part of the national health insurance
Many employers also offer voluntary benefits, such as extended occupational health care, but these are not mandatory. Read also Occupational Health Care in Finland: What International Companies Need to Know
Foreign Employees in Finland – What Should Be Considered?
A1 Certificate and Social Security Agreements
If you send an employee to Finland for less than two years, they may remain under their home country’s insurance system. This requires an A1 certificate, used in EU and ETA countries, Switzerland and the UK. The certificate confirms which country’s social security system the employee belongs to.
Without the certificate, the employee is included in Finland’s social security system. The A1 certificate can also be applied for retroactively, in which case incorrect payments are refunded.
Important: It is the employer’s responsibility to apply for the certificate. It determines where the employee receives benefits and where their pension accumulates.
COC Certificate for Non-EU Countries
Finland also has social security agreements with countries outside the EU – including the United States, China, Japan and Canada. In these cases, a COC certificate (Certificate of Coverage) is used.
Note: The COC certificate may not cover all insurances. Some insurances may still need to be taken in Finland depending on the situation.
When Is the Health Insurance Contribution Not Required?
If the employer does not have a permanent establishment in Finland and is not registered as an employer, the health insurance contribution is not required. In other cases, the payment is mandatory. Read also Taxation of a Permanent Establishment in Finland
How Are Payments Determined?
Annual Changes
Insurance contributions are updated annually. New rates are published at the turn of the year and come into effect at the beginning of the following year. The rates below are for 2025.
It’s worth keeping track of these changes, as they directly affect personnel costs. At Azets, we regularly inform our clients about statutory updates.
Earnings-Related Pension Insurance
The pension contribution is split between the employee and employer. In 2025, the employee's share depends on their age:
- Under 53 years: 7.15%
- 53–62 years: 8.65%
The employer pays the remaining portion. Contributions are calculated based on the total salary, and insurance companies receive the data from the Incomes Register.
Unemployment Insurance
The unemployment insurance contribution depends significantly on the employer's annual payroll. If the payroll is less than €2,455,500, the employer's share is only 0.2%. If the threshold is exceeded, the percentage increases considerably to 0.8% for the exceeding part.
The employee also pays their own share, which is deducted from their salary.
Accident and Group Life Insurance
These insurances are fully paid by the employer. The amount depends on the risk level of the work.
For example, in construction the payments are many times higher than for office work. The risk is defined by the TK10 code (occupational classification code), which must be reported to the income register for each employee.
Employer’s Health Insurance Contribution
The health insurance contribution is a fixed percentage. In 2025, it is 1.87% of the total payroll. The payment is made to the tax authority along with withholding taxes.
Opening Insurance Agreements
Pension and accident insurances require a separate agreement with an insurance company. No agreement is needed for unemployment insurance – the Employment Fund receives the data directly from the income register.
Please note: Accident insurance cannot be opened retroactively. If an employee starts work without valid insurance, penalties will follow. The Finnish Workers’ Compensation Centre monitors this closely. Make sure the insurance is valid before the first working day.
Azets Helps with Employee Insurance Matters
Do you need help opening and managing insurances? Azets has experience serving international companies. We’re happy to assist with setting up insurance agreements and managing them.
We also offer ongoing support with monitoring payments and annual updates, so you can focus on what matters – growing your business in Finland.