The number one benefit employees in Montenegro care about is health insurance. This gives them access to private health clinics that provide better service and care than the national health service.
New employers in Montenegro are often surprised by the fact that employees are not well educated about employee benefits.
The average cost of employer sponsored benefits is €5 per month.
Mandatory employee benefits in Montenegro include the states pension scheme and group personal accident insurance. Common supplementary employee benefits in Montenegro includes healthcare. Perks are not common in the country.
Mandatory employee benefits in Montenegro
Pension (State Scheme)
The law on retirement and disability insurance regulates these compulsory benefits. Retirement and disability insurance assure rights to certain benefits in cases of certain risks stipulated by law:
- Old age
- The risk of full loss of working ability – namely disability
- The risk of death
- The risk of bodily damage caused by industrial injury or occupational disease
The right to benefits (for the above-listed risks) in the area of retirement and disability insurance are:
- The right to old-age pension
- The right to disability pension
- The right to pecuniary benefit for bodily damage
- The right to career’s allowance
The listed benefits, acquired and exercised under the conditions prescribed by law, assure material and social security of contributors.
Note that brokers are not allowed by law to service pension insurance for their clients.
Group Personal Accident Insurance
It is obligatory for employers to provide group personal accident insurance as well as coverage for occupational diseases and work-related diseases for all employees (by law regarding safety and health at work). This policy covers death due to accident, death due illness and permanent disability. Additional coverage for daily compensations, bone breakages, etc. can be added. According to market practice, all (100%) of employers provide this policy separate from payroll deductions. The market practice is that policies are based on sums insured as determined by the employer and not multiples of salary.
Long-term disability and short-term disability are provided under the government scheme.
Supplementary Employee Benefits
There are two forms of private medical insurance (PMI) available in Montenegro. One is reimbursement PMI (known as voluntary health insurance) and the other is critical illness and surgical cash benefit insurance. Both coverages are mainly written on an employee group basis. The latter is a rider to group personal accident (PA) policies. Although the market statistics are difficult to interpret, it seems that lump sum riders are more common.
Lump sum medical covers were developed in response to the underfunding of state healthcare, which forces state hospital patients to pay many of their treatment costs in cash. These low-cost riders are tax deductible for the employer. The most common policy type covers outpatient costs to an annual limit of €2,000. More generous employers will cover inpatient and outpatient costs to a limit of €5,000.
Forty percent of companies provide additional medical insurance, and currently the best benefit on the market provides all employees treatment. Small companies may pay premiums for dependents, however larger companies offer employee rates to dependents that the employee covers.
Extended healthcare includes prescription drug coverage, hospital and supplemental healthcare, dental and vision.
This information about employee benefits in Montenegro is provided by MAI CEE, Asinta’s employee benefits consulting partner in Montenegro.