Workers’ compensation insurance for employees

Employers must insure their employees against accidents at work and occupational diseases. Unlike with pension and unemployment insurance, which are paid for by both the employer and employee, the employer is solely responsible for workers’ compensation insurance premiums.

The employer must take out insurance before the work begins. An insurance policy cannot be taken retroactively.

Minimum threshold for the duty to take out insurance

Employers must take out a workers’ compensation policy in the following situations

  • when the employer pays
  • or has agreed to pay wages amounting to more than 1 500 euro (year 2024) in a calendar year for work commissioned by the employer.

The threshold is specific to each employer and calendar year. All wages and salaries paid by the employer during the calendar year are added together.

A household is also considered an employer when it agrees on the performance of work and pays the employee a wage. For example, when a household employs a nanny, window washer and dog walker and pays each 600 euros in a calendar year, the total amount of wages paid is 1,800 euros, which exceeds the threshold for the duty to take out workers’ compensation insurance. The household must take out a workers’ compensation insurance that covers all employees hired by the household in an employment relationship.

Insuring work performed in an employment or public-service employment relationship

The insurance applies to work performed in an employment relationship or public-service employment relationship. An employment relationship is defined by the Employment Contracts Act as a situation where a person has agreed to perform work for an employer under the employer’s direction and supervision in return for pay or some other remuneration.

The performance of duties related a position of trust and voluntary work cannot be insured with workers’ compensation insurance. For information on insuring municipalities’ elected officials, see the section Other persons.

Employees holding a managerial position, self-employed persons’ family members and self-employed persons

Employees holding a managerial position are also covered by workers’ compensation insurance if their share of ownership of the company does not exceed the percentage specified by law. The threshold is the same as for pension insurance under the Employees Pensions Act.

Employees’ insurance also covers family members living in the same household with the self-employed person who work for the company in an employment relationship. 

Self-employed persons are not covered by employees’ insurance. Under certain conditions, self-employed persons may take out personal insurance equivalent to insurance for employees.

Voluntary insurance for self-employed persons
For detailed information on insuring persons holding a managerial position and the percentage limits for shares of ownership of the company, see the chapter Scope of application regarding individuals in the Insurance Handbook (in Finnish).