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National Insurance

National Insurance. Enhancing the promise……. securing the future!. October 28, 2013. Primary Mission. Provide social security coverage, in the form of benefit payments to insured persons and their dependents, against specified contingencies. Primary Mission.

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National Insurance

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  1. National Insurance Enhancing the promise……. securing the future! • October 28, 2013

  2. Primary Mission Provide social security coverage, in the form of benefit payments to insured persons and their dependents, againstspecified contingencies

  3. Primary Mission Specified Contingencies: • Sickness • Death • Invalidity • Childbirth • Retirement • Death of the Breadwinner • Industrial injury (disablement and death) • Involuntary unemployment.

  4. Secondary Mission Provide a minimum level of social security coverage for persons who do not qualify for such benefits as of right.

  5. Secondary Mission Assist with the sustained, orderly socio-economic growth and development of the country.

  6. Social Security Protection In order to fulfill the mandate, NIB collects contributions. Contributions fund benefits and assistance. Monies not paid out in benefits and assistance are invested to help grow the Fund.

  7. Income/Expenditure – the 2012 experience All Bahamas Active Insured persons: about 142,000. Contribution 2012: $203 million Benefit/Assistance pay-out: $199.8 million Reserve Fund: $1.65 billion

  8. Income/Expenditure – the 2012 experience All Bahamas in 2012 26,903 per monthreceiving LTB Additional 5,077 receiving assistance – i.e., needy elderly invalids, widows, widowers and surviving children ($16.1 million)

  9. Contributions Wage Ceiling Drives Benefits 1974 - $110 1985 - $250 1999 - $400 2011 - $500 2012 - $600

  10. Contributions – wage ceiling • Automatic Wage Ceiling Adjustments • Every 2 years – starting in July 2014 – by the estimated wage increases over previous 2 years

  11. Contributions – wage ceiling Ceiling on Insurable Wages since 1974 Period Oct. 1974 Jan. 1985 Jan. 1999 Jan. 2011 July 2012 Weekly$110.00$250.00 $400.00 $500.00 $600.00 Monthly 476.00 1,083.001,733.002,167.00 2,600.00

  12. Contributions – wage ceilings • On $110: ‘EE (3.4%): $3.74/’ER (5.4%): $5.94 wk • On $250:‘EE (3.4%): $8.50/’ER (5.4%): $13.50 wk • On $400:‘EE (3.4%): $13.60 wk/’ER (5.4%): $21.60 wk • On $400:‘EE (3.9%): $15.60 wk/’ER (5.9%): $23.60 wk • On $500:‘EE (3.9%): $19.50 wk/’ER (5.9%): $29.50 wk • On $600:‘EE (3.9%): $23.40 wk/’ER (5.9%): $35.40 wk

  13. Contributions Paid as a percentage of actual wages up to ceiling, however….. Integration Clause

  14. Contributions “…. Every employer is entitled to modify in such manner as may be prescribed, the rate of contributions and benefits payable under any pension scheme instituted by him for the benefit of his employees… for the purpose of eliminating overlapping benefits and contributions and for ensuring that the aggregate of the pension receivable under that scheme by an employee upon his retirement from the service of the employer or upon attainment of the prescribed rretirement age or by reason of his invalidity and the amount of the retirement or invalidity benefit receivable by the employee under this Act does not exceed the salary payable to him immediately prior to such retirement or invalidity.” (Sect. 22 (a))

  15. Contributions • 2010 Amendments • Effective July 1, 2013 • All wages up to ceiling to be included in insurable wages for CSPs

  16. Contributions - CSP Previously Weekly Insurable Pensionable Wages Civil Servant Employer Total Up to $110 3.9%PLUS 5.9%PLUS 9.8% Plus: (b) In excess of $110 2.2% 3.05% 5.25% up to the ceiling

  17. Contributions - CSP From July 1, 2013 Weekly Insurable Pensionable Wages Civil Servant Employer Total Actual wages up to Insurable ceiling3.9% 5.9% 9.8%

  18. Contributions - CSP A Regular Employed Person at age 65: (after paying some 2,008 contr.) 60% of $430 = $1,118.00 per month CSP at age 65 years: 60% of $110 = $301.08per month

  19. Contributions Questions???

  20. For Further Information • Call: 325-4653 or 325-4655 • Toll free from Family Islands • 242-300-1394 • website: www.nib-bahamas.com • or • Contact nearest NIB Local Office

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