What is once time Social Insurance? Is it recommended to withdraw Social Insurances at once?

Currently, Employees wish to resign to withdraw once time social insurance. However, experts, especially those from the department of labor invalids and social affairs, strongly recommended that once time social insurance should not be withdrawn, but continue to participate in Social Insurance to receive pension benefits.

Withdrawing Social Insurance at once time is a policy of social insurance, in order to pay part of the allowances to the participants that do not wish/have the ability to continue participating in Social Insurance. Once time Social Insurance is calculated based on the total time and the average salary participating in social insurance (including the yearly slippage notified by the Department of labor invalids and social affairs).

Relevant legal documents:

1. Law on Social Insurance 2014
2. Decision 115/2015/NĐ-CP orient Law on Social Insurance about compulsory social insurance
3. Circular 59/2015/TT-BLĐTBXH detailed regulation and orientation some clauses of Law on Social Insurance about compulsory social insurance

Conditions to receive One time social insurance:

1. The applicant’s years of participation is not enough (less than 20 years). For the applicants’ age that is still not eligible to retire then only after 12 months not working, not participating in Social Insurance the applicant is allowed to apply for once time social insurance;.
2. Reside in foreign country;
3. Applicant who is suffer from fatal diseases such as cancel, poliomyelitis, cirrhosis and ascites, leprosy, severe leprosy, HIV transferred to AIDS and other diseases prescribed by Department of Health;
4. Soldiers, military officers… .when in ex-soldier status, discharges that are not qualified to receive pensions.

Level of Allowances in Social Insurances will be calculated based on the participated years:

1. Participated years before 2024: each month accounts for 1,5 average salary months.
2. From 2024 upward: each year account for 2 average salary months
3. For applicant who participate in Social Insurance less than 1 year then the allowances accounts for the month applicant has participated, maximum is 02 participated average salary months.

The average participated salary month for employee who works for private sector (do not include Employee work for Government):

Will calculate on the average scale of the participating salary months of the whole time frame. In other words, the allowances accounts for total participating salary of each month (multiple the slippage rate notified by Department of labor invalids and social affairs) divide total participating months.

Amendments in the plan of changing Law on Social Insurance – relevant to the Once time Social Insurance:

There are two significant changes in the plan, affect the once time social insurance allowances of the participant:

1. The qualified participating years in order to receive Social Insurance also decrease from 20 years to 15 years. This will lead to a problem, some cases will transfer from qualified to unqualified in receiving one time social insurances (for people who participate in Social Insurance for more than 15 years but not up to 20 years)
2. Some new amendment regarding one time insurance, such as:
   • Participant only able to receive 50% amount of one time social insurance: this idea could affect the total amount of one time social insurance that one person can be qualified for.
   • Person who participates in new Social Insurance (from after 1/7/2025 – the proposed date that new law amending Social Insurance will come into effect) will not be eligible for one time social insurance. Persons who wish to take one time Social Insurance early and participate in Social Insurance before 1/7/2025 can still take one time insurance one more time.

Is it recommended to withdraw Social Insurance at one?

In reality, pension is a crucial policy to guarantee welfare of the elderly who are unable to work. The demand for withdrawing social insurance is high, but there are still many people who do not have specific plans for using the money after withdrawing, the whole sum of money will be used in a short time.
Therefore, citizens should consider these factors: Whether the demand of using the total amount has been specified or not and whether individuals can foster their own life without the capability of working anymore?

Should you have any queries regarding withdrawing social insurance at one time, please don’t hesitate to contact An Luat Viet Nam for advices, support.