Understanding Social Insurance in Vietnam

In the vibrant mosaic of Vietnam’s socio-economic evolution, the concept of social insurance emerges as a cornerstone, transcending its financial implications to embody a collective promise of stability and societal welfare. As the country strides forward, steeped in rich cultural heritage and rapid economic advancement, social insurance assumes an integral role, not just as a protective financial measure but as a testament to the nation’s commitment to its people’s holistic well-being.

Beyond the conventional safety net against unforeseen financial hardships, social insurance in Vietnam assumes a multifaceted identity. It intertwines with the nation’s ethos, reflecting a deeply ingrained communal spirit that places paramount importance on collective responsibility. It embodies a promise—a commitment woven into the fabric of society—to safeguard individuals and families, assuring them of comprehensive support during pivotal life moments.


The essence of social insurance in Vietnam extends far beyond fiscal remuneration. It resonates with the country’s ethos, underscoring a collective mindset that values the holistic well-being of its citizens. It represents a commitment to ensure not just financial security but to foster a societal environment that nurtures stability, embraces diversity, and cherishes the invaluable contributions of its people.

This comprehensive guide aims to navigate the intricacies of Vietnam’s social insurance landscape, unraveling the mechanisms of mandatory participation, contribution systems, eligibility criteria, and other nuanced aspects. Delving into this multifaceted system unveils not just its operational intricacies but also its intrinsic alignment with Vietnam’s cultural ethos—a testament to the nation’s dedication to social welfare.

The Structure of Social Insurance in Vietnam

To comprehend the profound significance of social insurance in Vietnam, one must navigate the intricate web of its structure. This system, meticulously regulated by the Law on Social Insurance and fortified by an array of legal underpinnings, embodies a multifaceted approach.

Types of Social Insurance

Health Insurance (HI): Ensuring Universal Healthcare Access

Eligibility and Benefits. Health Insurance (HI) in Vietnam serves as a cornerstone of accessible healthcare for all. Eligibility extends to citizens, providing coverage for medical treatment, preventive care, hospitalization, and essential health services. It ensures individuals receive necessary healthcare without facing significant financial burdens.

Scope of Coverage. The scope of coverage encompasses a wide array of medical services, including outpatient care, hospitalization, prescription medications, preventive measures, and specialized treatments. HI promotes a healthier population by facilitating early access to medical interventions.

Equitable Access. HI programs focus on equitable access to healthcare, bridging gaps between rural and urban populations. They aim to ensure that all citizens, regardless of their geographic location or socioeconomic status, have access to quality healthcare services.

Social Insurance (SI): Comprehensive Coverage Across Life Stages

Diverse Components. Social Insurance (SI) in Vietnam embodies a multifaceted approach, providing a safety net across various life stages. It encompasses diverse benefits, serving as a testament to the government’s commitment to social welfare.

Maternity Benefits. SI extends robust maternity benefits, ensuring female employees receive financial assistance equal to their average monthly salary for a specified period. This provision enables women to navigate motherhood without the stress of financial instability.

Work-Related Injury and Disease Benefits. Employees suffering from work-related injuries or diseases are entitled to medical treatment, rehabilitation, and compensation. SI addresses not only financial aspects but also ensures individuals receive the necessary care for recovery.

Retirement Benefits. SI offers retirement benefits, emphasizing financial security for retirees. This benefit is based on the individual’s average monthly salary and the duration of contributions, aiming to support individuals after their working years.

Survivor Benefits. In cases where an employee passes away, SI extends support to dependents, providing financial assistance to cover living expenses. This provision serves as a safeguard for the deceased employee’s family.

Unemployment Insurance (UI): Beyond Financial Support

Job-Seeking Support. UI in Vietnam goes beyond financial assistance during a job loss. It offers job-seeking support, including employment counseling, job-matching services, and training programs. These initiatives aim to empower individuals to re-enter the workforce confidently.

Duration and Payment Structure. UI benefits are structured to provide financial support during a predetermined period while ensuring individuals actively seek re-employment. The balance between financial sustenance and encouraging workforce reintegration is a pivotal aspect of UI.

Policy Evolution and Adaptation. UI policies continuously evolve to address contemporary labor market dynamics. They adapt to changing employment landscapes, technological advancements, and the evolving needs of the workforce, emphasizing holistic support beyond monetary compensation.

Social Insurance Fund

Purpose and Administration. The Social Insurance Fund, meticulously administered by Vietnam Social Security (VSS), serves as a financial reservoir designed to ensure the stability and sustainability of social insurance programs. It acts as a collective safety net, embodying the essence of collective responsibility toward social welfare.

Contributions. The fund derives its financial sustenance from multiple sources:

  • Employer Contributions. Employers play a pivotal role in sustaining the fund, making regular contributions based on their workforce size and payroll. These contributions serve as a critical source of funding, ensuring the availability of benefits for employees.
  • Employee Contributions. Employees also contribute to the fund, with a portion deducted from their salaries. These contributions play a fundamental role in financing the diverse benefits encompassed within the social insurance system.
  • State Allocations. Alongside employer and employee contributions, the government allocates funds to bolster the Social Insurance Fund. This injection of state resources strengthens the overall capacity of the fund, enabling it to cover a broader spectrum of social insurance benefits.

Financial Management. The fund operates under stringent financial management protocols. Vietnam Social Security (VSS) exercises meticulous oversight, ensuring prudent investment strategies, effective fund utilization, and long-term sustainability. The goal is to optimize the fund’s resources while meeting the current and future needs of beneficiaries.

Actuarial Considerations. Actuarial assessments play a pivotal role in managing the fund’s financial health. These assessments involve evaluating risks, liabilities, and the fund’s ability to meet its future obligations. Such considerations guide policy adjustments and ensure the fund’s resilience amid changing socioeconomic landscapes.

Collective Responsibility and Social Welfare. The Social Insurance Fund embodies Vietnam’s commitment to collective responsibility toward social welfare. It symbolizes a collective effort to ensure a safety net for individuals and families across various life stages, emphasizing the importance of solidarity in building a robust social security system.

Ensuring Sustainability. Continuous efforts are directed toward maintaining the fund’s sustainability. This involves a delicate balance between contribution rates, benefit provisions, and fiscal prudence, ensuring the fund’s longevity and uninterrupted support to beneficiaries.

Social Insurance Administration

Local-Level Operations. Social Insurance Agencies operate as the frontline custodians, intricately managing the diverse facets of the social insurance system. These agencies serve as the primary interface for beneficiaries, navigating the complex landscape of contributions, benefits, and enrollment.

Enrollment and Participation. At the heart of their duties lies the task of facilitating enrollment and participation in the social insurance system. They guide individuals and entities through the process, ensuring compliance with regulations and securing coverage for eligible participants.

Contribution Oversight. These agencies oversee the collection of contributions from employers and employees. They meticulously ensure that contributions are made in accordance with prescribed rates and deadlines, maintaining the financial stability of the Social Insurance Fund.

Benefit Management. Managing the disbursement of benefits constitutes a pivotal responsibility. Social Insurance Agencies are entrusted with the task of processing benefit claims, meticulously reviewing applications, and ensuring the timely and accurate distribution of entitled benefits to beneficiaries.

Claims Processing. They handle the intricate process of claims management, assessing the eligibility of applicants and validating claims against established criteria. This involves meticulous scrutiny of documents and adherence to predefined protocols to safeguard the integrity of the system.

Customer Service and Support. These agencies act as a primary point of contact for beneficiaries, providing guidance, assistance, and support. They address inquiries, offer clarifications on benefit entitlements, and facilitate seamless access to the benefits within the social insurance framework.

Regulatory Compliance and Oversight. Social Insurance Agencies operate under the purview of national regulations and guidelines. They ensure strict adherence to legal frameworks, deploying measures to prevent fraud, maintain accuracy, and uphold the sanctity of the social insurance system.

Compliance Monitoring. Vigilant monitoring is a key aspect, ensuring that employers and individuals comply with stipulated contribution requirements. Agencies conduct audits, inspections, and assessments to enforce compliance and maintain the system’s integrity.

Policy Implementation: They play a pivotal role in the implementation of policies and amendments related to social insurance. This includes disseminating information about changes in regulations and ensuring their effective integration into the operational framework.

Technological Integration. With the evolution of technology, these agencies are increasingly embracing digital platforms and systems to streamline operations. This modernization facilitates smoother processes, quicker responses, and enhanced accessibility for beneficiaries.

Key Components of the Vietnamese Social Insurance System:

Unemployment Insurance

Eligibility and Benefits

Unemployment benefits under the UI framework in Vietnam serve as a crucial lifeline for individuals encountering unexpected job loss, extending beyond mere financial assistance to offer a stabilizing force during tumultuous professional transitions. These benefits are designed to support employees who find themselves without work due to circumstances beyond their control, encompassing various scenarios such as layoffs, company closures, or job eliminations.

Financial Cushion Amidst Professional Turmoil. The core purpose of unemployment benefits within the UI system is to offer a measure of financial stability to affected individuals, acknowledging the inherent uncertainties of the job market. It aims to mitigate the immediate impact of job loss by providing a reliable stream of income, thus cushioning the financial upheaval experienced by individuals and their families during these challenging periods.

Eligibility Criteria and Qualifying Factors. To access these benefits, individuals must meet specific eligibility criteria set forth by the UI framework. Factors determining eligibility often include a minimum threshold of prior employment or contributions to the social insurance system, ensuring that those who have actively participated in the workforce are the primary beneficiaries of this support mechanism.

Duration and Payment Structure. The duration and payment structure of unemployment benefits typically adhere to predefined guidelines within the UI system. The payment amount is often a percentage of the individual’s previous income, calculated to offer a reasonable yet temporary source of financial support. Moreover, the duration of these benefits is generally finite, aimed at providing assistance during the immediate aftermath of job loss rather than as a long-term substitute for employment.

Job Training and Reemployment Assistance. The UI framework in Vietnam also frequently integrates job training and reemployment assistance programs to complement financial aid. These additional support measures aim to equip individuals with the skills and resources needed to transition back into the workforce effectively. Through counseling, training workshops, or job placement services, these initiatives empower individuals to enhance their employability and expedite their return to gainful employment.

A Vital Component of Social Insurance. Unemployment benefits within the broader social insurance spectrum symbolize more than just monetary aid. They represent a commitment to societal resilience, recognizing that economic fluctuations and professional uncertainties are inherent in modern work environments. By providing a structured safety net, Vietnam’s UI benefits reinforce the nation’s dedication to sustaining the well-being and economic stability of its workforce during times of transition and uncertainty.

How to Receive Unemployment Benefits

Claiming unemployment benefits under the UI system in Vietnam involves a systematic process that necessitates adherence to specific steps outlined by the governing authorities. Here’s a detailed guide on how individuals can receive these critical benefits:

Step 1: Notification and Registration. Upon experiencing job loss or receiving notice of impending unemployment, individuals must promptly notify the relevant Social Insurance Agency of their situation. Timely notification is pivotal, as it initiates the process of registering for unemployment benefits. At this stage, individuals may be required to provide details regarding their previous employment, including the duration of service and reasons for separation.

Step 2: Filing the Claim. After notifying the Social Insurance Agency, individuals must formally file a claim for unemployment benefits. This involves completing the necessary application forms provided by the agency. The application typically requires comprehensive information regarding the individual’s employment history, reasons for job separation, and any relevant documentation supporting the claim.

Step 3: Verification and Eligibility Assessment. Upon receiving the claim, the Social Insurance Agency undertakes a thorough verification process to ascertain the applicant’s eligibility for unemployment benefits. This verification may involve cross-referencing the provided information with employment records and other supporting documentation. The agency assesses whether the individual meets the stipulated eligibility criteria within the UI framework.

Step 4: Approval and Benefit Disbursement. Once the eligibility verification is complete and the claim is approved, the individual becomes entitled to receive unemployment benefits. The disbursement process usually involves the agency providing regular payments to the beneficiary. The frequency and structure of payments are determined by the regulations outlined in the UI framework, ensuring a steady and predictable flow of financial support during the period of unemployment.

Step 5: Compliance and Reporting Requirements. Throughout the period of receiving unemployment benefits, individuals are typically required to comply with specific reporting obligations. This includes providing updates on any changes in their employment status, income from alternative sources, or participation in job training programs. Compliance with these requirements ensures the continued eligibility for and receipt of unemployment benefits.

Step 6: Reemployment Assistance and Job Placement Support. In tandem with financial aid, beneficiaries of unemployment benefits often receive guidance and support aimed at facilitating their reentry into the workforce. The Social Insurance Agency may offer access to job placement services, career counseling, or training programs designed to enhance the employability of individuals and expedite their transition back to gainful employment.

Health Insurance

Eligibility and Benefits

Health Insurance (HI) in Vietnam is not just a financial safety net but a robust mechanism ensuring comprehensive and accessible healthcare services across various facets of wellness. This system, meticulously structured, stands as a testament to proactive health management, offering a wide spectrum of coverage that goes beyond basic medical necessities.

At the forefront, HI guarantees access to primary healthcare services, fostering a culture of preventive care, consultations, and essential vaccinations. It’s an assurance of early interventions and routine care, encouraging individuals to actively engage in managing their health.

Moreover, the coverage extends to hospitalization expenses, encompassing a broad spectrum of inpatient care, specialized treatments, and even surgeries. This broad inclusion not only emphasizes the importance of medical care but also ensures individuals have access to comprehensive treatments during serious health episodes.

In the realm of maternal and family health, HI stands as a stalwart supporter, providing extensive coverage for maternity services, spanning prenatal care, childbirth, and postnatal care. Furthermore, it often extends its umbrella to cover family members, guaranteeing their healthcare needs are met under the same provisions as the primary insured individual.

For those grappling with chronic diseases, HI facilitates ongoing treatment, medication access, and necessary therapies crucial for managing health conditions. It serves as a beacon of hope for individuals needing continual care by ensuring access to essential treatments and medications.

Additionally, rehabilitation services post-injury, surgery, or illness are included, reinforcing the comprehensive nature of HI. Beneficiaries can avail themselves of specialized medical care when required, enabling access to experts and specialized treatments.

HI also champions preventive healthcare measures, emphasizing health promotion, screenings, education, and preventive interventions. This proactive approach aims to minimize health risks and encourage individuals to maintain good health.

Crucially, HI plays a vital role in reducing out-of-pocket expenses, significantly alleviating the financial strain posed by medical treatments. Covering a substantial portion of healthcare costs, it lessens the burden on individuals and families, ensuring financial protection alongside quality healthcare.

Types of Health Insurance

In Vietnam, Health Insurance (HI) manifests in diverse forms, each tailored to cater to specific healthcare needs across the populace. This multifaceted system comprises various types of health insurance, offering distinct coverage to address different aspects of wellness. Primary health insurance covers essential medical services such as consultations, preventive care, and basic treatments. Complementing this, hospitalization coverage extends to inpatient care, surgeries, and specialized treatments for more critical health episodes. Maternity care is another vital aspect, ensuring comprehensive coverage for prenatal, childbirth, and postnatal care, emphasizing the importance of maternal and child health. Additionally, chronic disease management provisions encompass ongoing treatments, necessary medications, and therapies, acknowledging the needs of those with long-term health conditions. Rehabilitation and specialized care cater to recovery post-injury or illness, granting access to rehabilitative services and specialist treatments. Preventive measures are also integral, promoting health screenings, education, and interventions to proactively manage health risks. Each type of health insurance serves as a vital component in ensuring holistic healthcare coverage across various health needs in Vietnam.

Social Security

Social Security in Vietnam extends its protective embrace to encompass diverse eligibility criteria and a comprehensive spectrum of benefits, emphasizing the foundational principles of social welfare. Eligibility for Social Security covers a broad array of scenarios, acknowledging individuals at various life stages and circumstances. This includes coverage for retirees who have fulfilled the requisite age criteria, currently set at 60 for men and 55 for women, or met the mandatory contribution period of 20 years for men and 15 years for women. Additionally, Social Security caters to employees unable to work due to illness or injury, providing them with essential sickness benefits amounting to 75% of their average monthly salary for up to 180 days. These benefits reflect the system’s commitment to ensuring financial security during times of incapacitation, fostering stability and support for affected individuals.

The calculation and payment methods under the Social Security system revolve around meticulous assessments of an employee’s average monthly salary and their tenure of contributions. Pension amounts are intricately linked to an individual’s average monthly earnings and the duration of their contributions to the system. The methodology for calculating these pensions underscores the reliance on a combination of factors, notably the individual’s work history and the consistent contributions made over the years. These financial disbursements aim to provide a semblance of stability and financial support commensurate with the individual’s years of service and contributions to the Social Security fund. Payment methods are meticulously structured to ensure timely disbursement of entitled benefits, often conducted through designated channels facilitated by the Social Security agency, tailored to accommodate the varying needs of beneficiaries across the country

III. Mandatory Social Insurance Participation

Mandatory participation in Vietnam’s social insurance system is a cornerstone of the country’s social security structure. It’s designed to offer protection and financial stability to all employees by pooling contributions from various stakeholders, including employees, employers, and the government. The Law on Social Insurance stipulates compulsory enrollment, emphasizing the collective responsibility of ensuring basic income security and access to essential healthcare services.

Groups of Participants

The mandatory participation encompasses distinct groups:

Employees. Vietnamese citizens employed by both domestic and foreign-owned companies operating in Vietnam fall within this category.

Employers. Businesses operating in Vietnam are obligated to enroll their Vietnamese employees in the social insurance system.

Foreign Workers. Expatriates working legally in Vietnam and meeting specific criteria, as detailed by the law, are also required to participate in the social insurance scheme.

Distinction Between Foreign And Local Workers

The differentiation between local and foreign workers is based on residency and employment status. Vietnamese citizens working in Vietnam are subject to mandatory social insurance participation. Foreign employees, if legally employed in Vietnam and meeting specific criteria defined by the law, are also obliged to participate.

Contribution Mechanism

The contribution mechanism acts as the financial backbone of Vietnam’s social insurance system, facilitating the creation and maintenance of the Social Insurance Fund. This fund serves as the pool from which various benefits are disbursed. Regulated by the Law on Social Insurance, the contribution mechanism ensures a sustainable flow of funds to support the system.

Insurance Contribution Rate

Contributions are calculated based on a percentage of the employee’s salary. The current rates for contributions to social insurance are defined by the Vietnamese government and are subject to periodic adjustments.

Base salary

The base salary serves as the foundation for calculating social insurance contributions. It includes various components of an employee’s income, such as their monthly salary and additional allowances or bonuses.

Contribution procedures

Employers are responsible for deducting the stipulated contribution amounts from their employees’ salaries and remitting them to the Social Insurance Fund. The procedures for contribution are strictly regulated to ensure compliance with the law.

Benefits and Eligibility

Retirement pensions

Employees meeting the stipulated retirement age (60 for men, 55 for women) or fulfilling the mandated contribution tenure (currently 20 years for men, 15 years for women) are granted retirement benefits in the form of a pension. The pension amount is contingent upon the average monthly salary of the employee and the duration of their contributions.

Sickness benefits

For employees incapacitated due to illness or injury, sickness benefits are accessible, offering financial aid equivalent to 75% of their average monthly salary for a maximum duration of 180 days.

Unemployment insurance

Eligibility for UI entails individuals who have lost their jobs due to reasons beyond their control. This encompasses scenarios ranging from company closures to layoffs, offering a safety net for those encountering sudden unemployment. The benefits provided by UI extend financial assistance to these individuals, aiming to alleviate the financial burden during this transitional period. The assistance is structured to provide crucial monetary support, aiding individuals in sustaining themselves while seeking new employment opportunities. This financial aid typically amounts to a percentage of the individual’s previous salary, extending for a specified duration to bridge the gap until re-employment is secured. This serves as a vital cushion, ensuring individuals can navigate the transitional phase with some financial stability.

Special Considerations for Foreign Employees

Foreigners legally employed in Vietnam are mandated to engage in the country’s social security insurance program, as specified by Decree No. 143/2018/NĐ-CP, encompassing individuals with valid work permits, practicing certificates, or employment contracts extending at least a year. However, exceptions exist, notably for intra-company transferees per Clause 1, Article 3 of Government Decree No. 11/2016/ND-CP and employees reaching retirement age under Clause 1, Article 187 of the Labour Code.

These regulations are universally applicable to all foreign workers in Vietnam, irrespective of nationality. Expatriates working legally in Vietnam are automatically enrolled in the social security insurance system, with contributions deducted from their salaries. Expatriates enjoy benefits akin to Vietnamese citizens, including healthcare, retirement pensions, and unemployment benefits. Coverage duration aligns with employment terms, persisting even upon job changes or shifts in companies, provided the employment remains lawful. Claiming benefits necessitates adhering to procedures akin to Vietnamese citizens, involving claim submission and requisite documentation.

Furthermore, Vietnam’s social security agreements with various nations can influence coverage for expatriates from those countries, necessitating scrutiny of agreement terms for comprehension of social security coverage in Vietnam.


In the vibrant landscape of Vietnam’s social fabric, social insurance stands not just as a safety net but as a testament to the nation’s commitment to collective well-being. Its significance goes beyond financial remuneration, embodying a pledge to uphold the welfare of individuals at every stage of life. As Vietnam continues its remarkable journey of economic and social development, the evolution of social insurance remains pivotal. It will adapt to meet the changing needs of its diverse populace, continually expanding its scope to encompass newer challenges and opportunities.

Looking ahead, the future of social insurance in Vietnam is poised for further evolution. It will integrate technological advancements, refine policies, and broaden its reach to ensure inclusivity and accessibility for all segments of society. As the country progresses, social insurance will remain a cornerstone, fostering resilience, and offering steadfast support to the workforce and families.

For any inquiries or uncertainties regarding social insurance regulations or legal counsel in Vietnam, our team of seasoned corporate attorneys stands ready to provide expert guidance and assistance. Reach out to us at letran@corporatecounsels.vn anytime; we’re dedicated to helping you navigate the complexities of social insurance and ensure your comprehensive understanding of this vital facet of Vietnam’s legal landscape.