Income protection insurance in Switzerland

Banks, Insurances & Third Pillar
1

Hi all,

I am an Australian citizen living in CH with my Swiss spouse through a permit B. As I do not know enough German to work in CH, my income is derived from occasional self-employment (consulting) back in my home country. However I pay my taxes here in Switzerland as stipulated by the dual tax agreement.

I have always had income protection insurance back home, and it still covers me now, but I am looking to cancel this and sign up with a Swiss provider as we don’t foresee ourselves moving back to my home country.

In the first instance I have had a read and am slightly confused by the whole Pillar 1/2/3 concept. From what I understand, I cannot contribute to all of them as I am not working or self-employed in Switzerland. I would be keen to contribute to these for tax purposes but it appears to me that I can’t.

Secondly I have tried obtaining some quotes from the insurers online eg Generali but the maximum they have quoted me in the event of disability / illness/ injury is only a payout of CHF2’000 per month which seems abysmal! I am assuming that this is because they think I will be getting some form of payments from the pillars.

I am also keen to get us an independent financial advisor but we don’t have any recommendations either so if anyone can recommend a good one we would be most grateful.

Thank you

2

Hi welcome to the forum. Why do you say you are not working or self- employed in Switzerland - is that an assumption or did you get an opinion from an expert ?

I am by no means an expert, but since you are performing the activity whilst being physically in this country my starting assumption would be that you are currently self-employed in Switzerland. The income would be subject to Swiss income tax but you might also have to pay Swiss social security ( AVS etc).

1 Like
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Thanks Barto. I am thinking that I am self-employed but not in Switzerland. This is because, although I live in Switzerland 75% of the yea and am legally resident here, I don’t work at all when I am in Switzerland - when I go home to Australia for a visit, I do some occasional consulting work which is my self-employed income in Australia (but the taxes for these are paid here at the end of every year with my partner in the joint tax declaration).

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I very quickly scanned the DTA. Whilst not knowing your situation Art 14 seems to outline where similar income is only taxable in CH. It seems strange to have income subject to Swiss tax but not Swiss AVS, I can imagine it is possible but beyond my knowledge :slight_smile:

All employees in Switzerland pay into unemployment insurance which has great cover. “Payroll umbrella companies” exist. You could have such a company invoice your clients and pay you a salary as a swiss employee. You would have AVS contributions etc to pay and the complexities of invoicing across borders. I suspect you might be better off without - but I mention it since the income insurance seems important to you.

You can also purchase life or insurance to cover death or illness