A new social insurance scheme covering
private and government establishments will come into effect on April 1
and will include an increase in the subscription rate to 18 percent,
the General Organization for Social Insurance (GOSI) announced
Governor Sulaiman ibn Saad Al-Homaid said the new system would be
applied from Muharram 1 (March 26) for those businesses which use the
Hijri calendar, and from April 1 for those rely on the Gregorian
calendar. Other features of the system include a provision for early
retirement, pension payment for families of prisoners and making the
self-employed liable for social insurance.
A package of
instructions issued by GOSI to establishments joining the insurance
system stipulated that the amount subject to deduction is based on the
annual salary and house rent with the latter calculated at two
month’s payment. The subscription rate should not exceed SR45,000
per month and should not be less than SR400.
first-time subscribers, the age must be less than 60 years under the
Hijri calculation (58 years, one month and 20 days under Gregorian) at
the time of insuring.
percent subscription is divided equally between the employer and the
person covered. The 9 percent premium is being implemented in stages
starting with 6 percent to be paid upon the introduction of the new
system. The rate is then raised to 7.5 percent for another year and
should reach the 9 percent target on April 1, 2003.
added new categories to those covered by GOSI including people
employed in the agricultural, forest and farming sectors in addition
agencies and corporate ventures with government stakes will require
establishments dealing with them to submit a certificate from GOSI
stating that they are registered with the organization and have
fulfilled all their obligations or clearly indicate they are not
subject to GOSI system. This requirement is to be met if these
establishments want to apply for government contracts, procurement,
and subsidies or want to fulfill any transaction relating to their
system brings parity between the insurance contribution of private
sector employees with those of the civil service and the military.
over the past 26 years given more than SR24.4 billion in pension and
compensation. The organization has provided insurance coverage to 6.6
million subscribers and more than 24,000 establishments since its
inception in 1970.
Source: Arab News