National Insurance Institute of Israel

The **National Insurance Institute of Israel** (NII), commonly known as *Bituach Leumi*, is Israel’s public social security institution. Operating under the National Insurance Law, it collects national insurance contributions and administers benefits addressing old age, disability, unemployment, parenthood and other circumstances. It also collects health insurance contributions for Israel’s public health insurance system. ^[1][2]

Legal basis and role

The Knesset passed the National Insurance Law in November 1953. The institute describes its purpose as providing economic protection to people and families facing temporary or long-term hardship. Its functions extend beyond a single insurance program: it administers a range of benefits under the National Insurance Law and implements other social security laws and agreements, including provisions for income support. ^[1]

Although its name includes the word *insurance*, the NII is not a commercial insurer selling individually priced policies. Its statutory arrangements collect contributions according to rules that take account of income and insurance status, while entitlement to a particular benefit depends on that benefit’s legal conditions. Some programs address risks associated with employment or contributions; others support children, older people or households with insufficient income. The institute characterizes its benefit payments as transferring income toward financially vulnerable groups. ^[1][2][3]

The NII’s remit is also distinct from that of the Bank of Israel, which is Israel’s central bank, and from institutions that manage personal retirement savings. An NII old-age benefit is a statutory social security payment, not a balance accumulated in an individual kupat gemel or keren hishtalmut account. This distinction matters when describing Israel’s retirement income arrangements: public benefits and personal savings are different sources of income, subject to different rules. ^[1][3]

Benefits and services

The institute lists old-age and survivors’ benefits, maternity and children’s benefits, work-injury payments, general disability benefits, long-term care, unemployment benefits, and protections relating to bankruptcy and corporate liquidation among its programs. Its benefits catalogue also includes income support, payments associated with reserve service, assistance for victims of hostile actions, and employee-rights benefits in insolvency cases. The existence of a program does not mean that every resident qualifies for it; entitlement is determined under the rules of the relevant benefit. ^[1][3]

These programs respond to different financial events. Unemployment and work-injury benefits can address interruptions to earnings, while maternity benefits and child allowances relate to family circumstances. Old-age and survivors’ benefits address later life or the death of an insured person. Disability and long-term-care programs concern needs that may persist over a longer period. Income support has a different role: the NII identifies the Income Support Law as a measure intended to protect families against income loss and help guarantee basic subsistence to people in need. ^[1][3]

Not all assistance takes the form of a cash payment. The NII states that it provides vocational rehabilitation and training services for people with disabilities and victims of hostile actions, as well as long-term-care and counseling services for older people. It also operates funds that develop community projects serving groups with particular needs, including older people, people with disabilities, and children and young people in distress. These activities make the institute both a benefits administrator and a provider or supporter of social services. ^[1]

National insurance contributions

The NII collects national insurance contributions from residents according to their income and insurance status. Its contribution information distinguishes, among others, salaried employees, self-employed people and people who do not work. Employers participate in the collection and financing arrangements for employees. Consequently, there is no single contribution rate that describes every person’s obligation: the applicable calculation depends on the person’s circumstances and on the income being assessed. ^[2][4]

For salaried workers aged 18 to retirement age, the NII publishes separate employee and employer rates. Its rates effective **January 1, 2026** apply a reduced rate to the portion of monthly wages up to NIS 7,703, described as 60% of the average wage, and a full rate to the portion above that threshold up to NIS 51,910. On the lower portion, the published national insurance rates are 1.04% for the employee and 4.51% for the employer. On the higher portion, they are 7% and 7.6%, respectively. These figures are national insurance rates; health insurance is shown separately in the NII’s table. ^[5]

Self-employed people have a different rate schedule. For those aged 18 to retirement age, the NII’s rates effective January 1, 2026 show national insurance rates of 4.47% on the income portion up to NIS 7,703 and 12.83% on the portion above it, up to NIS 51,910. The schedule also displays health insurance contributions separately. The NII publishes additional rules for people outside these age and work-status categories, so the standard salaried and self-employed tables should not be treated as universal rates. ^[5][6]

Contributions are an important source of financing, but they are not the only one. The NII’s description of its financing also identifies participation by employers and the government, along with income from interest on investments. Its published financing overview contains historical monetary totals; those totals should not be read as a current budget without a stated reporting year. The broader point is that the institute’s financing combines statutory collections with public financing rather than relying on individual benefit recipients to fund their own payments directly. ^[4]

Health insurance collection

The NII has a separate collection role under the National Health Insurance Law. It collects health insurance contributions and transfers collected funds to the health funds, or *kupot holim*. The NII’s health insurance information says that insured people must be registered with a health maintenance organization and may choose which one to join. Collecting the contribution is therefore not the same as directly providing all covered medical care: the institute performs a financing and administrative function within the health insurance system. ^[2][7]

For salaried employees, the employer deducts the employee’s health insurance contribution from wages. In the NII’s January 2026 salaried-worker table, the health insurance rates are 3.23% on the lower wage portion and 5.17% on the higher portion, with no separate employer health insurance rate in that table. Other payment arrangements can apply to people who are self-employed, do not work or receive certain benefits. National insurance and health insurance contributions may be collected together, but they serve different statutory purposes and are identified separately in the published rates. ^[5][7][8]

Administration and access

The NII combines contribution collection with benefit administration. Its website provides routes for submitting claims and documents online, obtaining forms and authorizations, using calculators, updating bank account details, paying contribution debts or benefit overpayments, and arranging branch appointments. The site also provides a means to change from one health maintenance organization to another. These functions illustrate the range of information the institute handles, from work and income status to eligibility and payment details. ^[9]

The institute’s published benefits catalogue is organized around circumstances such as work stoppage, injury, maternity, disability and later life. That organization can help distinguish a person’s possible benefit claim from their obligation to pay contributions. In particular, making contributions is not itself a determination that a specific claim will be approved; benefit eligibility is assessed under the applicable program. Similarly, a person who is not currently employed may still need to consider the contribution rules that apply to their insurance status. ^[2][3][9]

Economic and research significance

The NII is a source of information about the effects of Israel’s tax-and-benefit system as well as an administrator of that system. Its Research and Planning Administration publishes surveys and research on social insurance and welfare. The institute also publishes reports on poverty and income inequality, topics directly connected to the income transfers made through social security benefits. ^[3][10]

In its report on poverty in 2024, the NII reported an individual poverty rate of 20.7% and a family poverty rate of 20.0%. Those are findings for **2024**, not measures of poverty in 2026. The figures give context to the institute’s distributional role, but they do not by themselves isolate the effect of any single NII program. Its benefits encompass both payments linked to particular life events and measures directed at financial need, so the relationship between social security spending and measured poverty depends on the programs and households being examined. ^[1][11]

In financial descriptions of Israel, the NII is therefore best understood as a statutory collector, payer and administrator of social security. It is neither a deposit-taking bank nor an investment fund. Its contribution schedules affect labor income and employer costs; its benefits affect household income during qualifying circumstances; and its health insurance collections support a separate public-health financing framework. The amounts, thresholds and eligibility provisions attached to these functions can change, so any numerical description needs an effective date and the relevant insurance category. ^[1][2][5][7]