A Closer Look at Kuwait’s Social Security System

In a country with a relatively small population and high-earning gross domestic product (GDP) such as Kuwait, one would surmise that the government would have a national insurance scheme that could sufficiently fund its people’s needs and welfare.

Unfortunately, the government insurance scheme does not extend to expats because the only benefit given to them is the opportunity to live in the country through stable job opportunities with highly attractive compensation packages.

Kuwait’s Social Security System: What You Need to Know

While Kuwaiti nationals greatly benefit from the government social security fund, otherwise known as the Financial Remuneration Fund, which provides support for their medical care, maternity and sickness coverage, pension, child care, and in some cases, even housing and disability benefits, foreign nationals generally receive minimal benefits, if any at all, from the government. This is mainly because the Kuwaiti government does not have any employer-contribution schemes in place. This only means that in the event that an expat becomes unemployed, he/she will be repatriated as the State will not help cover their daily upkeep.

It is for this reason that the Kuwaiti government has started to put pressure on the companies to offer/provide private medical insurance for their employees so that expats would not add more pressure to the national healthcare programmes of the government.

Image Credit: Nick Youngson, (Alpha Stock Images)


Kuwait does not offer state pension schemes for foreign nationals. However, some government-owned institutions and certain international firms provide corporate pension schemes for expatriates.

It is important, then, that if you are already paying for a state pension scheme in your home country, that you continue to pay your contributions, even if in reduced form. This will prove to be one of your best investments, even as you work abroad for the steady returns that you will receive upon retirement.

If you are among those expats who are entitled to a state pension from your country of origin, you will have to check with the local pensions department to see if they can help transfer your money to you while you are in Kuwait. Depending on your country’s agreement with Kuwaiti authorities, international money transfers can be processed more quickly and conveniently. Otherwise, you may need to have your pension money deposited to your bank account from home and then have it transferred  to yourself. Remember that international bank transactions will charge you transfer fees so it’s important to look at the most cost-effective option that you would like use for this purpose. This also applies to private pensions that you have fulfilled during your stay abroad.

Alternatively, expats should allocate a certain portion of their income for setting up a personal pension plan while earning from work abroad. It is best to check with your company’s pension scheme which could either be afforded in lump sums or through regular savings contributions so that you can avail a plan that best suits your retirement goals and lifestyle.

Working abroad entails foreign employees to make necessary adjustments to remain consistent with their financial goals, especially in preparation for retirement. Among the important adjustments to be made include the selection and availment of a reliable pension scheme as well as getting a reliable insurance package that will at least cover the basic necessities of living abroad.

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