Foreign Assistance in Greece
Insurance in Greece
Mandatory Public (social) vs. Optional Private
PART 1: I.K.A. + T.E.B.E.
It's a well established fact that most social security systems throughout the world suffer from lack of funding, or are let's say strapped for cash and these two systems are the epitamy of this. According to my tax consultant, CPA, and good friend of mine, IKA and TEBE are one of the worst in the world. I agree. So what are these monstrosity gas guzzlers of the insurance arena? First of all IKA is pronounced eeka the ka as in cup. TEBE is pronounced teve. IKA is the mandatory insurance all employees must receive and all employers must pay. It is extremely expensive for what coverage it offers and no employer wants to pay it to his/her workers. They will do anything to get out of it and the govt. knows this. This coverage comes in the form of stamps called ensima and a certain amount of these have to be accumulated or paid for for migrant workers to get a residense/work permit. For example, for a migrant to be eligible for a permit he/she must prove that he/she is covered by IKA, either paying themselves or having their boss pay. IKA costs roughly 350 euros every 2 months. 50% is paid by the employee and 50% taken out of worker's wage. If the migrant is not employed then he will have to pay about 5 months IKA to be eligible for a residense permit. Few can afford it and few do on both sides. It is very common for an employer to tell the job applicant straight forward, "you want IKA, no job." This is very illegal but with connections more than 30% of workers are employed without IKA. After you have accumulated thousands of ensima during 20 or so years at 65 you can retire. The minimum you get is about 450 euros per month. You'll live the rest of your life eating souvlakia and cheap barrel retsina wine and never turn on any lights in the house unless it's absolutely necessary. This evasion to pay IKA is not restricted just to the minority immigrants but to Greeks as well. For the record, 37.8% of Greeks contribute to IKA and a whopping 43.1% of immigrants. Why? Because immigrants are scared. of losing their right to stay in Greece. The employers without connections or who don't give fakelakia (little bribe money in envelopes) will pay the IKA. Really is there anyone in Greece who hasn't at one time or another paid fakelakia? The answer is no.
But this is not the only reason why IKA is broke. The poor victims of IKA injustice who demonstrate every month or so about the injustices of IKA or the elderly waiting in vain for their pension in outrageous lines in the freezing cold outside of IKA offices don't know the truth. The truth is big companies such as the Dept. of Defense, OTE (telecomunications) football companies, DEH (electric company) don't pay IKA to IKA. This means that these companies pay the workers, deduct from their salary but never pay IKA the money. We are talking about millions and millions of euros never collected. It's really not IKA's fault that all they can afford to give you if you become ill is a cot in a corridor of a run down hospital.
TEBE, the compulsory insurance for the self employed, is exactly the same as IKA. The same 350 euros every 2 months for the same "wonderful" health and pension coverage. When I owned a school for foreign languages in Athens I had to pay TEBE for myself and IKA to my secretary and teachers. It's a wonder how I made any money at all.
If you think that non payment of IKA to employees only applies to blue collar migrant workers, think again. What happened to a colleague of mine? He is a professor at an American college here. They wouldn't pay IKA to him. He was desperate for the position, acquiesced with no IKA and was hired. I taught at Southeastern College for 4 years and the only way I got the job was telling the dean that I had private insurance and did not need IKA. He gave me the contract to sign right away. I'll discuss private insurance in part 3.
See Insurance in Greece Part 2
See Insurance in Greece Part 3
