What happens if you don’t pay your Swiss health insurance premiums on time?
Given significant rate hikes announced for 2024, you could find it difficult to pay your premiums on time. But penalties for missed or late payments are stiff in Switzerland.
As insurance rates will rise by 8.7 percent on average (and quite a bit more in some cantons), the budget of many households will be strained, especially with higher electricity charges to go into effect in 2024 as well.
It is perhaps understandable that you may be tempted to skip paying your health insurance premiums one month, planning to catch up the missed payment(s) in the future.
However, you should not do that.
Here’s why.
Hefty penalty fees
As is the case with any bills you don’t pay, the arrears are going to catch up with you.
Usually, you have 30 days to pay your invoices, with most companies giving you a few extra days of grace period before sending you reminders — polite ones at first, and later on, less so.
In case of health insurance, your provider will typically send one ‘free’ reminder. From the second one (assuming you still haven’t made the payment), the carrier will charge you ‘late fees.’
According to Moneyland consumer platform, “each additional reminder is generally accompanied by a penalty fee. This penalty fee ranges between 10 and 50 francs, depending on the insurance provider. Penalty fees for compulsory health insurance premiums are typically higher than those for supplementary health insurance."
If the premium is still not paid after several warnings have been issued, a debt collection claim is filed, adding additional costs to the process.
“Penalty interest on the unpaid premium at the rate of 5 percent a year is added to your health insurance bill. This penalty interest rate is stipulated by law and is identical across all insurance providers,” Moneyland said.
Other fees may be added to your bill in addition to penalty interest, ultimately turning into a huge debt — something you want to avoid at all costs (see below).
What if you just can’t afford to pay your premiums?
You would certainly not be alone in this predicament.
In Switzerland, between 20 and 30 percent of the population can’t pay for health insurance, and in Geneva this proportion is even higher — over 40 percent.
If you find yourself in this situation — that is, if your payment for health insurance will exceed 8 percent of your income in 2024 — you can have your premium reduced.
All cantons have budgets allocated specifically for this purpose — to subsidise part of the health insurance payment for low-income households and individuals, as well as for families with many children.
And given much higher premiums in 2024, cantons are raising their contributions toward health insurance subsidies.
READ ALSO: Swiss cantons increase financial help towards health insurance premiums
So if your premiums eat up at least the aforementioned 8 percent of your income, you are eligible to have your premiums reduced, which is certainly a better option than paying your bills late or, even worse, not at all.
Before deciding whether you receive the assistance, however, your canton of residence will look not only at your earnings, but at any other financial assets you hold as well.
So if your income is low but you have plenty of money in the bank in the form of savings or other investments, you will not qualify.
Exact subsidy amounts may vary from one canton to another.
Will you receive government help?
Subsidies are available to anyone obligated to take out Swiss health insurance — that is, anyone living in Switzerland for more than 90 days, regardless of their nationalities — with just a few exemptions from this rule.
Eligibility is based on your most current tax declaration, which allows the authorities to see not only how much you earn and how many children you have, but also your total assets.
Some cantons will notify those who are eligible automatically when you file your tax return. In others, you must apply for the reduction yourself every year.
This is a list of all the cantonal authorities responsible for subsidies.
This is why you must pay your premiums on time
As mentioned above, being late, or not paying at all, will trigger a debt collection process, which you want to avoid at all costs, especially if you a foreign national who is planning to apply for naturalisation..
The State Secretariat for Migration states that non-payment of health insurance premiums, and accumulation of debt in general, is a valid reason for denying citizenship.
READ ALSO: How personal debt could stop you from becoming Swiss
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As insurance rates will rise by 8.7 percent on average (and quite a bit more in some cantons), the budget of many households will be strained, especially with higher electricity charges to go into effect in 2024 as well.
It is perhaps understandable that you may be tempted to skip paying your health insurance premiums one month, planning to catch up the missed payment(s) in the future.
However, you should not do that.
Here’s why.
Hefty penalty fees
As is the case with any bills you don’t pay, the arrears are going to catch up with you.
Usually, you have 30 days to pay your invoices, with most companies giving you a few extra days of grace period before sending you reminders — polite ones at first, and later on, less so.
In case of health insurance, your provider will typically send one ‘free’ reminder. From the second one (assuming you still haven’t made the payment), the carrier will charge you ‘late fees.’
According to Moneyland consumer platform, “each additional reminder is generally accompanied by a penalty fee. This penalty fee ranges between 10 and 50 francs, depending on the insurance provider. Penalty fees for compulsory health insurance premiums are typically higher than those for supplementary health insurance."
If the premium is still not paid after several warnings have been issued, a debt collection claim is filed, adding additional costs to the process.
“Penalty interest on the unpaid premium at the rate of 5 percent a year is added to your health insurance bill. This penalty interest rate is stipulated by law and is identical across all insurance providers,” Moneyland said.
Other fees may be added to your bill in addition to penalty interest, ultimately turning into a huge debt — something you want to avoid at all costs (see below).
What if you just can’t afford to pay your premiums?
You would certainly not be alone in this predicament.
In Switzerland, between 20 and 30 percent of the population can’t pay for health insurance, and in Geneva this proportion is even higher — over 40 percent.
If you find yourself in this situation — that is, if your payment for health insurance will exceed 8 percent of your income in 2024 — you can have your premium reduced.
All cantons have budgets allocated specifically for this purpose — to subsidise part of the health insurance payment for low-income households and individuals, as well as for families with many children.
And given much higher premiums in 2024, cantons are raising their contributions toward health insurance subsidies.
READ ALSO: Swiss cantons increase financial help towards health insurance premiums
So if your premiums eat up at least the aforementioned 8 percent of your income, you are eligible to have your premiums reduced, which is certainly a better option than paying your bills late or, even worse, not at all.
Before deciding whether you receive the assistance, however, your canton of residence will look not only at your earnings, but at any other financial assets you hold as well.
So if your income is low but you have plenty of money in the bank in the form of savings or other investments, you will not qualify.
Exact subsidy amounts may vary from one canton to another.
Will you receive government help?
Subsidies are available to anyone obligated to take out Swiss health insurance — that is, anyone living in Switzerland for more than 90 days, regardless of their nationalities — with just a few exemptions from this rule.
Eligibility is based on your most current tax declaration, which allows the authorities to see not only how much you earn and how many children you have, but also your total assets.
Some cantons will notify those who are eligible automatically when you file your tax return. In others, you must apply for the reduction yourself every year.
This is a list of all the cantonal authorities responsible for subsidies.
This is why you must pay your premiums on time
As mentioned above, being late, or not paying at all, will trigger a debt collection process, which you want to avoid at all costs, especially if you a foreign national who is planning to apply for naturalisation..
The State Secretariat for Migration states that non-payment of health insurance premiums, and accumulation of debt in general, is a valid reason for denying citizenship.
READ ALSO: How personal debt could stop you from becoming Swiss
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