What do the statutory life and disability benefits cover?
Life benefits are provided through the Instituto Nacional do Seguro Social (INSS), Brazil’s national social security scheme. Employers must pay termination indemnities if an employee dies in service. A survivors’ pension is due to qualifying survivors (such as widowers and dependent children under the age of 21).
Long-term disability benefits are also provided by the INSS social security scheme. If an employee resigns as a result of disability, employers must pay a termination indemnity. Additionally, qualifying individuals may be provided with reduced retirement benefits.
The disability pension is payable when short-term sickness benefits end or within 15 days of it being determined that the employee is unable to work due to the disability. This benefit would be payable so long as the disability exists. The pension is calculated on the employee’s average adjusted pensionable salaries (the highest 80% of salaries), up to a maximum amount per month.
It is important to note that employees on leave through INSS cannot be terminated, as they are protected by local law. If a permanent disability benefit is reviewed and canceled by the INSS, the employee must return to work in the same position they held before.
What life and disability benefits do most employers offer?
It is very common for employers to provide supplemental life insurance benefits. We are required to do so by our CBA (Collective Bargaining Agreement). It is mandatory per our CBA to provide supplemental life insurance in the amount of at least BRL 12,286.62 for death by natural causes and BRL 19,029.93 for accidental death or permanent incapacity due to an accident. It is very common to provide even more than this (24x - 36x the base salary).
Velocity Global’s supplemental life and AD&D insurance provider in Brazil is Icatu Seguros. For additional information regarding this offering, including plan summaries and cost details, please reach out to Velocity Global through your normal process, and we will help you.