What is it?
The sickness daily allowance insurance is designed so that if someone falls ill and cannot work, the insurer replaces part of their salary.
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Typically, about 80% of the gross salary is paid.
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The benefit lasts as long as a doctor certifies incapacity to work, but for a maximum of 720 days (2 years).
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This insurance is not mandatory, but most employers take it out for their employees for protection.
How does the money work?
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Everyone pays the insurance premium (employer, employee, or shared 50/50).
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Example: salary 5000 CHF, premium about 1–2% → 50–100 CHF per month.
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This money is not saved in your personal account.
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It is not a savings plan; it goes into a common fund managed by the insurer.
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From this pool, the insurer pays those who are actually sick.
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If someone is ill for 2 months, their allowance is paid from the pool.
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If you are not sick, your contributions remain in the pool to help others.
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The rest covers the insurer’s costs, reserves, and profit.
Who receives the money?
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If your employer arranged the insurance: the insurer pays the employer, who continues your salary.
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If you have private insurance: the insurer pays you directly (usually monthly).
Example in practice
Comparison with savings
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Savings: your money stays on your account and you can use it later.
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Sickness insurance: money goes into a shared pool, and you only get it if you fall ill.
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That’s why it’s called risk insurance: it pays only if the risk (illness) occurs.
✅ In short
The sickness daily allowance insurance:
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is not savings, but a common fund
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covers 80% of salary during illness
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your contributions help others if you stay healthy
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that is the essence of the Swiss system
