IJsland
In addition to statutory social insurance, Iceland has a statutory employment-related pension scheme. All employed persons and their employers are required by law to pay a specified minimum premium to a pension fund. The pension fund pays old age pensions and invalidity pensions, as well as death grants following a spouse’s death. The right to payments from a pension fund is determined on the basis of the amount of payments received from the fund member and length of payment period. Further information about such entitlement can be obtained from the pension fund in question. In addition to the minimum premium, supplementary pension savings can be made either through contributions to a personal pension fund or deposits on a pension savings account with a financial service company. The employer pays a matching contribution in accordance with the terms of collective bargaining agreements.
Old age pension is paid to all persons 67 years of age or older, regardless of class or marital status. Men and women enjoy the same rights in this respect. To be entitled to old age pension, a person needs to have resided in Iceland for a minimum of three years between the ages of 16 and 67. A full old age pension is paid to individuals who have resided in Iceland for at least 40 years between the ages of 16 and 67. In cases of shorter periods of residency, the old age pension is reduced proportionally. In other words, the amount of the old age pension is proportionate to the length of the period of residence.
To be entitled to an invalidity pension, applicants need to have been resident in Iceland for at least three years immediately prior to submitting an application. They must also be between 16 and 67 years of age. An invalidity pension is paid in cases of permanent invalidity, assessed at 75% or more, as a result of a medically recognised disease or invalidity.
To be entitled to a child pension in respect of the death or invalidity of a parent, the child itself, or either of its parents, needs to have been resident in Iceland for at least three years immediately prior to application.
Social insurance does not pay widows’ or widowers’ pensions, only child pensions. However, an application may be made for a grant following a spouse’s death for a limited period.
