If you are self-employed in Switzerland and fall ill, you have a problem: there is no continued salary payment. OR Art. 324a does secure employees' salaries for a limited time — but this protection only applies to employees. For the self-employed, income drops to zero during illness. This is exactly where daily sickness benefit insurance in Switzerland comes in: it pays you a daily allowance when you are unable to work due to illness. This guide explains what the KTG costs, how the Karenzfrist (waiting period) works, when the insurance is mandatory, and how to deduct it from your taxes.

The daily sickness benefit insurance — commonly known as KTG (Krankentaggeldversicherung) — is the most important form of protection for the self-employed alongside AHV (the Swiss state pension scheme). Without it, you bear the full income risk during illness yourself. And that can be expensive: six weeks off work can cost a freelancer earning CHF 80,000.00 per year easily CHF 9,000.00 or more.

The key facts at a glance

• KTG costs approx. CHF 50.00–200.00/month for the self-employed (1–3% of gross income)
• Karenzfrist (waiting period): 14–30 days — during this time the KTG does not pay
• Daily benefit: usually 80% of your most recently earned income
• KTG premiums are tax-deductible as business expenses
• For employers with staff, mandatory in most cantons from 1 employee

What is daily sickness benefit insurance (KTG)?

Daily sickness benefit insurance is an insurance policy that pays you a daily allowance when you cannot work due to illness or accident. It replaces part of your earned income — typically 80% — and closes the gap that arises when, as a self-employed person, you have no entitlement to continued salary payments.

Important: KTG is not the same as your health insurance. Regular health insurance (KVG, the compulsory basic health insurance) covers the costs of doctor visits, hospital stays, and medication. It pays the medical bills. KTG, on the other hand, does not pay a single franc to doctors — it pays money to you so you can cover your living expenses while you are sick. These are two entirely different types of insurance with different purposes.

KTG is based on the Health Insurance Act (KVG). KVG Art. 3a regulates the daily benefit insurance as an optional component of health insurance. You can find the current wording of the law on admin.ch under SR 832.10 (Health Insurance Act). The daily benefit insurance can be taken out with the health insurer that also manages your basic insurance — or with a separate insurance company that offers KTG products.

For employees, the situation is clear: OR Art. 324a obliges the employer to continue paying the salary for a certain period in the event of illness — generally at least three weeks per year, depending on the canton and years of service, potentially longer (Bern scale, Zurich scale). Many employers therefore take out a KTG to cover this risk. As a self-employed person, you have no employer to cover for you. You must act yourself.

Why the self-employed need KTG

OR Art. 324a protects employees. The employer must continue paying the salary in the event of illness — at least for a limited period. The law distinguishes by years of service: in the first year of service, this is generally three weeks, after which the duration increases. Cantonal scales such as the Bern scale or the Zurich scale specify these durations. Once the employer's obligation to continue paying salary ends, the KTG — if held — kicks in.

For the self-employed, OR Art. 324a does not apply. No employer, no continued salary payment. If you as a freelancer fall ill for six weeks, your income stops on day one. Invoices you cannot issue go unpaid. Clients you cannot serve find another solution. This can be existentially threatening — especially for solo self-employed people without reserves.

Marc's story

Marc is a graphic designer from Bern. He works as a solo self-employed person with an annual income of around CHF 85,000.00. In spring 2025, he came down with a severe flu with complications — he was unable to work for six weeks. No KTG, no continued salary payment, no replacement income. Six weeks at around CHF 2,000.00 per week means CHF 12,000.00 in lost income. Marc had reserves, but they were almost entirely depleted.

A year later, Marc took out a KTG policy. He pays CHF 89.00/month with a 30-day waiting period and 80% daily benefit. If he were to fall ill for six weeks again, the KTG would pay for the last two weeks (after the waiting period expires) approximately CHF 2,800.00 — not everything, but a significant portion of the loss.

The calculation is simple: CHF 89.00/month is CHF 1,068.00/year. Compared to a potential income loss of CHF 12,000.00 from a six-week illness, that is an insurance that pays off — if not for every illness, then certainly for the serious ones.

If you are considering taking the leap into self-employment, the guide Becoming a freelancer in Switzerland provides an overview of all the costs you will face — including KTG.

Waiting period (Karenzfrist) and waiting days explained

The Karenzfrist (waiting period) is the waiting time before the KTG begins to pay. During the waiting period, you receive no daily allowance. You choose the waiting period when you take out the insurance — and it has a direct impact on the premium.

Typical waiting periods:

The logic is simple: the longer you bear the risk yourself, the cheaper the insurance. Most self-employed people choose 30 days — a compromise between premium and protection. Anyone with enough reserves to survive three months without income can choose 90 days and save significantly on the premium. Those without reserves should choose 14 days or even 7 days — but pay more.

Waiting days (Karenztage) are the individual days within the waiting period. If the waiting period is 30 days and you are ill for 35 days, the first 30 days are waiting days (no payment), and the KTG pays for days 31 to 35 — i.e. five daily benefits.

For employees, there are cantonal scales that regulate continued salary payment during illness. The Bern scale, for example, stipulates that the employer continues to pay the salary for three weeks in the first year of service, four weeks in the second to fourth year, and eight weeks from the fifth year onwards. The Zurich scale is structured similarly. These scales regulate how long the employer pays — and the KTG kicks in afterwards. For the self-employed, these scales do not exist. You choose the waiting period freely.

Practical tip: If you have reserves covering at least three months of expenses, choose a 30-day waiting period. That is the sweet spot between premium and protection. If you have no reserves, choose 14 days — but build up reserves in parallel so you can bridge the waiting days.

How much does daily sickness benefit insurance cost?

The premium for a KTG depends on several factors. The rule of thumb: 1–3% of gross income per year. With a gross income of CHF 80,000.00, annual premiums range between CHF 800.00 and CHF 2,400.00 — i.e. CHF 67.00 to CHF 200.00 per month.

The most important price drivers:

• Age: Younger insured persons pay less. From age 40 onwards, premiums rise noticeably.
• Health status: With pre-existing conditions, the insurer may apply a surcharge or agree exclusions.
• Daily benefit amount: The higher the daily benefit (e.g. 80% vs. 60% of income), the higher the premium.
• Waiting period: Shorter waiting period = higher premium.
• Benefit duration: 720 days (approx. 2 years) vs. 1,095 days (approx. 3 years). Longer benefit duration = higher premium.
• Insurance type: Daily benefit insurance with a health insurer (KVG-compliant) vs. private insurance.

Sarah's story

Sarah is a web designer from Zurich. She earns around CHF 90,000.00 per year and has taken out a KTG with the following terms:

• Daily benefit: 80% of her most recently earned income
• Waiting period: 30 days
• Benefit duration: 720 days
• Premium: CHF 147.00/month (CHF 1,764.00/year)

This corresponds to around 2% of her gross income. When Sarah broke her wrist in summer 2025 and was unable to work for six weeks, the KTG paid a daily benefit of CHF 4,200.00 per month for the remaining two weeks after the 30-day waiting period expired. In total, she received around CHF 2,100.00 — less than her actual income loss, but enough to cover rent and the most important bills.

Had Sarah chosen a shorter 14-day waiting period, the KTG would have paid for four weeks instead of two — but the premium would have risen to around CHF 190.00/month. Calculated over the year, that would be CHF 516.00 more in premiums. Sarah deliberately chose 30 days because she has reserves.

If you track your income and expenses cleanly, you know exactly how high your daily benefit needs to be. With invoicing via Magic Heidi you keep your income in view — and know exactly how much you need to replace in the event of illness.

KTG deduction: deducting daily sickness benefit insurance from taxes

Good news: KTG premiums are tax-deductible for the self-employed. They count as business expenses and thereby reduce your taxable net profit. This means you not only bear less risk, but also pay less tax.

The ESTV (Federal Tax Administration, Eidgenössische Steuerverwaltung) treats daily sickness benefit insurance premiums for the self-employed as deductible business expenses — provided the insurance serves to secure earned income. This is regularly the case for the self-employed. You can find the official guidelines on the ESTV website under the documents on profit tax for the self-employed.

A sample calculation:

You earn CHF 80,000.00 per year and pay CHF 1,500.00 in KTG premiums. Without the KTG deduction, your taxable net profit would be CHF 80,000.00. With the KTG deduction, it drops to CHF 78,500.00. At a combined tax rate (federal + cantonal + municipal) of, say, 25%, you save CHF 375.00 in taxes. The effective cost of the KTG thus falls from CHF 1,500.00 to CHF 1,125.00.

This also applies to other business expenses. Anyone setting up a sole proprietorship should record all business expenses cleanly from the outset — KTG premiums, professional liability insurance, software, work equipment. Every deductible franc reduces the tax burden.

Note: If you receive KTG daily benefits as a self-employed person, these are generally taxable as replacement income. You must declare them as income on your tax return. This is not a disadvantage — it is simply the flip side of the coin: premiums are deductible, daily benefits are taxable. The ESTV publishes current information sheets on this topic.

If you are wondering what other expenses you can deduct, it is worth taking a look at the guide on VAT accounting for freelancers — it primarily deals with MWST (Swiss VAT), but the structure of business expenses is the same.

Daily sickness benefit insurance: mandatory or voluntary for the self-employed?

The answer depends on whether you employ staff or not.

For self-employed without employees: voluntary.

If you are a solo self-employed person — no employees, no apprentices, no staff — the KTG is voluntary. No one forces you to take one out. But as Marc's example showed, the risk without KTG is significant. The question is not whether the KTG is mandatory, but whether you can afford the risk of not having it.

For employers with employees: mandatory in most cantons.

As soon as you employ staff, the legal situation changes. KVG Art. 3a allows cantons to make daily benefit insurance mandatory for employers. Many cantons have made use of this option and require employers to take out a KTG for their employees — usually from the first employee, in some cantons from a certain number of working hours or from the second employee.

The exact regulations differ from canton to canton. Most cantons require a KTG with a minimum benefit duration and a maximum waiting period. If you hire employees, you must check with the cantonal health authority to find out what obligations apply in your canton.

Thomas's story

Thomas is a carpenter from Lucerne and runs a sole proprietorship with two employees. In the canton of Lucerne, the KTG is mandatory for employers. Thomas must take out a KTG for all three people — himself and two employees. The total cost is CHF 340.00/month for three policies. The KTG for the employees covers the continued salary payment obligation under OR Art. 324a — Thomas must continue paying the salary during illness himself, but gets the money back from the insurance.

For the employees, this is an advantage: they know their salary is secure in the event of illness. For Thomas, it is an advantage because he does not bear the risk himself. The premiums for the employees' KTG are deductible as business expenses — they reduce the taxable profit of the carpentry business.

If you hire employees, you must also register with the AHV and prepare payroll. The criteria for self-employment are set out in AHVG Art. 2–3. You can find information on this at ahv.ch. Anyone who is self-employed on a part-time basis will find further guidance on AHV and social insurance in the guide on part-time self-employment in Switzerland.

Comparing providers: health insurer vs. insurance company

If you want to take out a KTG, you have two types of providers to choose from: KVG-recognised health insurers and private insurance companies. Both offer daily benefit insurance, but with differences.

KVG-recognised health insurers:

Insurers such as Swica, Helsana, CSS, KPT, and Sanitas offer daily benefit insurance as an add-on to basic insurance. The advantages: they often have no medical selection process, acceptance is generally guaranteed, and premiums are calculated on a risk-adjusted basis. KVG-compliant daily benefit insurance is particularly attractive for self-employed people looking for a simple solution without a health check.

• Swica: Daily benefit insurance with flexible waiting periods (7–90 days), selectable benefit duration.
• Helsana: KTG with various daily benefit models, combinable with basic insurance.
• CSS: Daily benefit with selectable daily benefit rate and waiting period.
• KPT: Specialised in canton-specific solutions, often good premiums for the self-employed.
• Sanitas: Transparent daily benefit models, digital administration.

Private insurance companies:

Insurers such as AXA, Die Mobiliar, and Baloise offer KTG products that can be taken out independently of a health insurer. The advantages: often more flexible design, higher daily benefits possible, selectable terms. The disadvantages: a health check is often required, exclusions for pre-existing conditions are possible, and premiums can rise with age.

What to look out for when comparing:

1. Daily benefit amount: What percentage of income is replaced? 80% is standard; some providers offer up to 100%.
2. Waiting period: Choose one that matches your reserves.
3. Benefit duration: 720 days (2 years) or 1,095 days (3 years)? Longer duration = more protection, higher premium.
4. Pre-existing conditions: Are these excluded or covered with a surcharge?
5. Health check: Is a medical examination required? Usually not with KVG insurers, but often with private insurers.
6. Flexibility: Can you change the daily benefit and waiting period later?
7. Cancellation period: How flexibly can you switch insurers?

Practical tip: Obtain at least three quotes — from one health insurer and two private insurers. Compare not only the premium but also the terms and conditions. The cheapest KTG is not the best if it does not pay out for the illness that actually hits you.

If you have your finances clearly in view, the decision becomes easier. With Magic Heidi from CHF 25/month you track income, expenses, and premiums in one app — and immediately know which daily benefit rate fits your income. Anyone looking for an accounting solution that is cheaper than bexio will find a streamlined alternative for Swiss freelancers in Magic Heidi.

Frequently asked questions (FAQ)