Social Security and Pensions
The Icelandic pension system is based on three main pillars: the social security system, an occupational pension system and supplementary pension savings.
Social security is a public pension system of which all Icelanders are members, with the primary objective of providing mutual insurance, income equalisation and a social safety net for pension recipients. Social security includes pensions, health insurance and disability insurance.
The Ministry of Welfare is ultimately responsible for social security, for formulating policy in this area and for supervising the enforcement of legislation on social security.
The State Social Security Institute handles basic disability and retirement pensions under the Social Security Act, No. 100/2007. It is also responsible for social assistance and related entitlements provided for in the Social Assistance Act, No. 99/2007.
Icelandic Health Insurance is responsible for the implementation of the Act on Health Insurance, No. 112/2008, the Act on Social Security Occupational Injury Insurance, No. 45/2015, and the Act on Patient Insurance, No. 111/2000.
The occupational pension funds are based on the mandatory membership of all employed persons from 16 to 70 years of age, and are intended to provide retirement pensions and mutual insurance.
Supplementary pension savings are an optional route for saving for senior years.