Health insurance: Recipients of a Swiss pension living abroad

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Hi All

I’m a UK citizen who has just finished a 15 year stint living & working in Switzerland, and will be taking early retirement to go and live in an EU country, where, as part of my application for residency, I was obligated to take out private health insurance (at a fraction of the cost of Swiss insurance).

I had a interesting exchange with my Swiss health insurer when I informed them that I wanted to cancel my insurance as I was leaving Switzerland permanently to relocate to an EU country. They asked me to complete a questionnaire which includes a question ‘‘will you retain a financial connection with Switzerland when you leave’’? I asked the health insurer how should I answer this question since when I leave I will cash in my 3a and non-mandatory pillar 2 pensions, but otherwise will not retain any ‘‘financial connection’’ with Switzerland, i.e. no bank accounts or investments with the exception of eventually claiming my pillar 1 and the balance of my pillar 2 pension in several years once I reach the appropriate age.

Their response was that ‘‘a lump-sum withdrawal also triggers the obligation to take out insurance in Switzerland, so that you must (continue to) take out insurance in Switzerland’’, but that I should check with the KVG.

(The KVG is the body set up by the Swiss government as the ‘‘health insurance liaison body for recipients of a Swiss pension resident in an EU/EFTA/UK and insured in Switzerland’’ - interestingly they are funded by the Swiss health insurance industry…)

I contacted the KVG, explaining my situation, who replied ‘‘As soon as you have received your Swiss pension, you are subject to compulsory insurance in Switzerland. An early withdrawal/capital withdrawal or a payment from the 2nd pillar also leads to compulsory insurance. Private insurance does not release you from the insurance obligation in Switzerland. As soon as you draw your pension, you have three months to apply for exemption from compulsory insurance. If you do not submit this application within three months, it will be rejected and you will be obliged to take out insurance in Switzerland.’’

I was very surprised at this reply because this practically means that anyone who has ever worked in Switzerland and who claims a private and/or Swiss state pension triggers a requirement to retain Swiss health insurance.

Having looked at the guidance it seems that if you move to some, but not all, EU-EFTA-UK countries, then you can apply for exemption, but that the KVG is the decision maker (note previous comment about them being funded by the Swiss health insurance industry).

I have been going back & forth with the KVG to try & get clarity but getting nowhere, & they continue to insist that I have to apply for exemption & they decide whether to grant it or not.

I was wondering if anyone has come across this before and how they have dealt with it (how is it even enforceable if they decide not to grant exemption?)

Here is a link to the Swiss Federal Office of Public Health guidance:

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I think they are wrong, but you screwed up by asking the question. Here’s what I suggest you do to avoid the issue completely:

  1. You are still in time to change healthcare insurance. Cancel your healthcare and sign up with a different low cost health provider. Old provider has to cancel on the basis that you are signing up with someone new and will receive confirmation from the new provider.
  2. When you leave, cancel the new insurance (let’s assume this is next year so you paid something and can successfully cancel the old one). This time, answer NO to the question if asked

Maybe you pay a month or two extra insurance, but will save you some hassle.

If you keep asking questions to KVG and health insurance, you are going to end up in a tarpit of adminsitrative procedures and you’ll need to provide info and apply for exemptions etc. better to avoid the whole thing.

It reminds me of this:

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Thanks Phil, and yes in hindsight I should have kept quiet.

I forgot to mention in my earlier post that my Swiss health insurer did eventually capitulate & cancelled my insurance after I informed them I would cancel my direct debit & leave the country.

What I’m concerned about is in several years time, withdrawing the mandatory part of my pillar 2 & Swiss state pension & getting hit with a backdated bill for Swiss health insurance because I didn’t file for exemption when I took out the capital lump sum - this is because the KVG insist that as soon as a Swiss pension is received in any form the obligation to take out Swiss health insurance rears its head again - presumably as the government appointed ‘‘health insurance liaison body for recipients of a Swiss pension’’ they would/could be informed when a Swiss pension is withdrawn?

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Personally, I’d cross that bridge when I come to it.

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Maybe @Fatmanfilms can help here as well? He has a broad knowledge on cashing out pillar 2 and may have run into this as well.

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This is really confusing.
My mother who is bi-national CH/EU decided to return to an EU country, where she had previously lived and from which she also is getting a pension - as well as from CH.
My mother wanted - for whatever reason - to keep her Swiss health insurance. But that insurance said that since she is getting pension from another country, she can not keep her Swiss health insurance.

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I agree swissnyc, it seems as if the authorities either don’t understand the law or interpret it in whichever way the individual who responds understands it, which just leads to stress and confusion.

In my own case I’ve received multiple responses from KVG (sometimes from the same person) many of which often contradict their other responses - on one occasion I even sent them their guidance document & quoted the relevant clauses to support my argument which they just chose to ignore., which is hugely frustrating.

Given all this, I am seriously considering taking Phil_MCR’s advice to just ignore them in order to avoid getting bogged down in more administrative bureaucracy with an organisation whose employees don’t understand their own rules, and just deal with it when the time comes - unless of course, someone who has been through this can convince me otherwise.

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I am pretty sure smth was not clear in german correspondence probably between you and authorities that led to misunderstandings, how old are you? if you are much younger than retirement age and move to eu country, you just take what you can from 2nd (non-mandatory parts), 3rd pillar and that’s it. If you are already retirement age and can withdraw your 2nd pillar, then i could see that some obligation to take out insurance kicks in and you have to exempt yourself from that, there are agreements with spain, portugal, … you can choose where to be insured. But leaving before official retirement no one continues to pay health insurance, there are tons of eu-workers back and forth, it would be ridiculous if all those millions continued paying health insurance.

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I completely agree CloudsInTheSky, it is ridiculous.

I am 58, which is why I can only take the non-mandatory part of the pillar 2 plus the pillar 3a - the KVG know the law which is why I am completely perplexed by their replies.

I would imagine that many people (particularly non-Swiss) living abroad and in receipt of a Swiss pension are probably completely unaware of this rule, will therefore not have filed an exemption request, and are happily insured in their EU-EFTA-UK country of residence. What the KVG explicitly and repeatedly state is that ''If you do not submit this application within three months (of receipt of your first pension payment), it will be rejected and you will be obliged to take out insurance in Switzerland.’’ I guess the other big question is how is this even enforceable?

I corresponded with them in English and they replied (most of the time) in English.

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Been there, done that, have the T-Shirt…

It’s fairly simple, if you receive partial or full pensions for multiple countries, then the one paying the most is responsible for your healthcare. If that happens to be Switzerland, then you’ll have to take out Swiss insurance, although usually at a reduced rate and you have the right to return to Switzerland for healthcare if you wish.

It’s possible to apply for an exemption, but in a nut shell to get one, the country in which you reside most acknowledge that they will take over responsibility for your healthcare. And nobody is excited about taking over those costs unless they have to.

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Thanks Bob.

According to the letter I received from the KVG the rule is that you have to take out health insurance with the country where you have paid contributions for the longest period of time (not the most amount of contributions, or from where you receive the largest pension). Here’s an extract from the letter I received from the KVG:

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It’s also mentioned here: Recipients of a Swiss pension living abroad

A question that I have relates to submitting (or not) a request for exemption, & how it works in practice? For example, do you receive a demand to take out health insurance from the Swiss authorities at the time you receive your first Swiss pension payment or do you have to self report?

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Nice theory that hasn’t been applied to my mother. Theory that doesn’t really make sense to me. For me, the health insurance should be paid in the country where you will use the health system.

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“… paid the longest period of time …” now that is probably the rule that has been applied for my mother.

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Is it the case that your Mother is receiving a pension in her EU country? If that was the case then this part of the law would apply: ‘‘Persons drawing a pension from their country of residence must take out health insurance in that country.’’
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Have you been paying voluntary UK NIC? I’ve been paying this every year to ensure that I’ve been paying into the UK system longer than the Swiss one.

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The bit you quoted sounds familiar. I’m not sure if things updated since then but then it sounds like if you will be in the UK and will draw a UK pension, then you will need health insurance in the UK. I guess the UK has the added complication that you have the NHS rather than specific health insurance, but even if that is a problem, taking a year of private health insurance there should do the job.

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In the first post, OP said they will live in an EU country. Not UK then. Unless, OP forgot about Brexit.

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They way it works is that you have to take out health insurance yourself and provide evidence of this. If you do not, they will take out insurance for you and back-date it. Expect to be able to find cheaper insurance yourself.

If you don’t want to have to get insurance via Switzerland, I suggest you make sure you have a longer pension contribution history elsewhere. Assuming you are from the UK, then maybe you already have some history there and can boost it with voluntary payments. While working, this can be efficient if you make Class 2 contributions.

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Yes I’ve continued paying NICs so I’m assuming that will count in the longevity of contributions test that the Swiss apply. However, in the letter I received from the KVG (& their own guidance notes) they only mention EU-EFTA countries, whereas the FPOH website also mentions the UK, so it’s unclear to me if UK contributions apply.

Another complicating factor is that the EU country that I’m moving to made it obligatory to take out private health insurance (albeit the most basic) in their country (they wouldn’t accept my Swiss policy) in order to approve my application for residency.

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UK and CH have signed agreements which based on the BAG website seem to indicate that UK is treated more or less as it was when it was in the EU.

However, I guess you also need to check the EU country you are staying in and what agreements have been signed with UK and CH.

Our posts crossed. I guess it is clear at least when you move there but before drawing a pension. Though you still need to clarify once you start drawing a pension how the healthcare should be handled. It seems to me if you have mandatory local insurance, this is what you would use to get the exemption for Swiss insurance.

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