The relocation process involves a lot of arrangements, bureaucracy and issues that must be addressed. One of them and it is important for your future and the future of your family members is everything related to insurances and pensions.
Sending an Israeli employee on behalf of the company for relocation usually involves severing the employee-employer relationship between the employee and the Israeli company that sent him, and his employment by the local company in the destination country. This may harm the level of pension security of the employee and his family. The managers’ insurance plan and the employee’s pension funds include three components: pension savings, disability insurance and life insurance.
Severing employee-employer ties with the Israeli employer has consequences – the termination of pension savings will harm the employee when he retires. Regarding loss of work capacity – although some companies purchase local work loss insurance for employees abroad, the insurance requires that in the event of loss of work capacity, the employee will remain in the destination country and in most cases the employee will want to return to Israel. Therefore, it is advisable to arrange everything before your departure and get professional support.
At Ocean, you can receive support in the pension field, which includes various aspects such as:
- Handling termination of employment as an employee and recommendations regarding taxation of severance pay upon leaving work.
- Establishing health insurance in an insurance sequence – defining a plan and required related coverages for the employee and all family members.
- Handling the current coverages and adjusting the employee’s insurance basket to his and his family’s special needs. You need to discuss any insurance coverage and examine whether it would be right to continue or cancel it. Many companies transfer the Israeli employee to the local company in the destination country without checking what the local pension insurance benefits are and without trying to adapt them to the fact that the Israeli employee has unique needs. Should I continue the temporary crash? What happens in phase B after establishing programs in the destination country? and more. The pension part requires a different approach than the insurance part. Any coverage that is canceled in the insurances that exist today, will require a renewed health declaration upon returning to Israel.
- Private insurance policies – life insurance, health, illness, disability and more – discussion of the viability of continuing the plans and the type of coverage in each individual policy.
- Loss of working capacity coverage – continuity until the insurance is settled in the destination country.
- Handling the work completion paperwork and submission to the assessor for tax settlement.
- Accompaniment in opening the programs in the destination country and help in choosing the most suitable program for you.
In general, it would be worthwhile to withdraw the liquid savings such as training funds that have already reached their point of departure after six years and the short-term savings, close to leaving for relocation.
If you are in the process of returning or moving to Israel, it is important that you know that when you return to Israel, the employer is not obligated to set aside for you pension savings in the first six months of your employment. That’s why you should take care of this ahead of time and open a private pension fund.
