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Social Security and Welfare

Italy - Social Security and Welfare


The United States and Italy have a Bilateral Social Security (Totalization) Agreement which improves Social Security protection for people working in both countries. Under the agreement, an employee will not have to pay taxes to both the US and Italy on the same earnings. This agreement covers Social Security taxes but it does not cover benefits under the U.S. Medicare program. You may have some credits in the US and some in Italy and the number of credits with each country may not be enough to make you eligible for benefits with either country. However, you can add your credits from both countries together to meet the eligibility requirements.

A U.S. expat working in Italy or self-employed will have to pay Social Security taxes to (and receive coverage from) the US. Those who have dual U.S./Italian citizenship and are in employment or self-employed may choose either US or Italian coverage. This decision needs to be made within three months from the date of employment. Either you or your employer will have to send a request for a certificate of coverage from the country where you want to continue your coverage. This certificate can then be used to receive an exemption from compulsory social security taxes from the other country. To get a certificate of coverage from the US, you will need to fill form USA/IT 4 which can be obtained from the United States Social Security Office located. The address is:

Social Security Administration
Office of International Programs
P.O. Box 17741
Baltimore, Maryland 21235-7741
U.S.A.

To request a certificate of coverage from Italy, you need to send your request to:

Ministero del Lavoro e delle Politiche Sociali
Direzione General per le politiche previdenziali
Div. II
via Flavia 6
00187 Rome
ITALY

Apart from the US, Italy has several reciprocal social security agreements with various countries which define the social security entitlement for the expats from these countries. Countries that have a social security agreement (SAS) with Italy include Australia, Canada, Argentina, Brazil, Croatia, Turkey, Uruguay, Venezuela, Bosnia Herzegovina, the Channel Islands, the former Yugoslav Republic of Macedonia, the Principality of Monaco, San Marino, Serbia and Montenegro and the Republic of Cape Verde. Italy has a partial social security agreement with Israel and South Korea where workers remain insured with Italy. Italy also has a partial social security agreement with Mexico only with regard to pension transfers. There are also agreements with other countries such as New Zealand, Chile, Morocco, Japan and the Philippines that have not yet been ratified.

Every legal resident in Italy is required to make social security contributions if they are employed and they have unrestrained access to the social security system. Workers from non-EU countries can accrue their social insurance and pension benefits and can cash them in once they reach the pension age, even if they have returned to their home countries.

Expats living legally in Italy have equal rights and responsibilities as Italian nationals. The the Istituto Nazionale della Previdenza Sociale (INPS) covers disability benefits, unemployment benefits, pensions and paid sick leave.

Until 2004, Italy’s generous state pension ensured that people could retire by 57 with generous benefits. The rapid erosion of the system has led to increasing problems and the state pension fund faces bankruptcy within the decade. The high rate of unemployment and the shrinking national workforce has resulted in a situation where the payments made out to retirees are more than the incoming contributions. In response to the crisis, the retirement age will be increased progressively each year to 66 by 2018. Under the Austerity measures that were introduced to combat Italy’s debt crisis, men will need to make 42 years of contributions and women will need to make 41 in order to claim a pension. Italians rely heavily on state pension and over three-quarters of all Italian employees are not covered by any company pension scheme. The two types of pension funds, namely closed pension funds and open pension funds. Closed pension funds are implemented by a company or employer for a specific group of participants. Open pension funds are offered by banks or insurance companies for a generic group of participants. An employee’s pension contribution is deduced automatically from his/her salary.

It is mandatory for non-EU residents to have private health insurance when applying for a visa. A private health insurance policy (assicurazione sulla salute) would be your best option as it covers the portion of your medical bills that isn’t paid by social security.


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Expat Health Insurance Partners


Aetna

Our award-winning expatriate business provides health benefits to more than 650,000 members worldwide. In addition, we have helped develop world-class health systems for governments, corporations and providers around the world. We want to be the global leader in delivering world-class health solutions, making quality health care more accessible and empowering people to live healthier lives.

Bupa Global

At Bupa we have been helping individuals and families live longer, healthier, happier lives for over 60 years. We are trusted by expats in 190 different countries and have links with healthcare organisations throughout the world. So whether you're moving abroad for a change of career or a change of scene, with our international private health insurance you will always be in safe hands.

Cigna

Cigna has worked in international health insurance for more than 30 years. Today, Cigna has over 71 million customer relationships around the world. Looking after them is an international workforce of 31,000 people, plus a network of over 1 million hospitals, physicians, clinics and health and wellness specialists worldwide, meaning you have easy access to treatment.