Social insurance system
In the last decade the social insurance system in Bulgaria has undergone deep changes trying to respond to the new social, economical and political realities and to get closer to the best models of social security systems in the developed countries. The reform includes an establishment of new philosophy and principles of the insurance tri-pillars pension model, renewed legislation and normative order, institutional organization of the representatives of the new insurance relations. In 1999 is adopted the Law for the additional voluntary pension insurance, regulating the third pillar of the pension system which legalizes the activity of the private pension funds. The Code for the obligatory pension insurance as of year 2000 settles the pension insurance in the first and second pillars as well as all others insurances for the social risks disease, disability, old age, death and as of year 2002 – unemployment as well.
Obligatory pension insurance
Public Social Security is obligatory for all employees employed by Bulgarian or foreign natural or corporate bodies within the country. They are secured for all risks. The employers must register at the local social security administration within 7 days from the day, they have employed anyone subject to compulsory insurance.
Compulsorily, all workers and employees are to be insured, no matter if they had labor or civil contracts. Workers and employees that work under civil contract are obliged only for insuring: disability, caused by general illness, for old age and for death. An exception of this obligation is possible only if the civil contract was for monthly payment under one minimum working salary.
Other pension insurance opportunities
According to the Code of Social Insurance, supplementary social insurance shall be carried out through participation in universal and/or occupational pension funds, supplementary voluntary pension funds and supplementary voluntary social insurance funds for unemployment or professional training, which shall be established and managed by pension companies or supplementary voluntary social insurance companies for unemployment and/or professional training, licensed in accordance with the Code by the Financial Supervision Commission.