Stay compliant with China's social insurance requirements for foreign employees. Learn about the 'Five Insurances' & manage your contributions effectively.
Last reviewed: August 2026. Foreign employees legally employed in China generally participate in employee basic pension, basic medical, work-injury, unemployment and maternity insurance under the revised Interim Measures.
In our previous blog, ‘Integration of Work Permit and Social Insurance Card - Remember These!’, Hongda discussed the work-permit and social-security-card integration introduced on 1 December 2024. The integration loads work-permit information onto the social security card; it should not be described as a standalone rule making social-insurance payment a universal work-permit renewal condition.
Prior to this, you may not have been familiar with China's social insurance system, nor may you have been required to contribute to it. In this blog post, Hongda will provide a detailed introduction to China's social insurance system. After reading, you'll understand the main compliance points, while your exact contribution base, city practice, and treaty exemption status should still be checked against your employment and visa situation.
If you are hiring foreign staff, renewing a work permit, or trying to understand whether an exemption treaty applies, Hongda can review the payroll and social insurance steps before the filing starts.
Section 1: What Items are Included in Social Insurance System?
Before reading this blog, you might have heard of the "Five Insurances and One Fund" (五险一金), where the "Five Insurances" represent the five types of social insurance contributions, including: Pension Insurance, Medical Insurance, Unemployment Insurance, Work Injury Insurance, and Maternity Insurance. Contribution obligations vary by insurance type and local rules; for example, work-injury insurance is paid by the employer, while the employer and employee contribution responsibilities for other items should be confirmed under the rules of the place of participation.
Pension Insurance
Pension benefit eligibility depends on the current statutory retirement rules, contribution history and local administration.
Medical Insurance
Medical insurance is the protection that allows insured individuals to enjoy healthcare benefits when they need daily medical services or incur medical costs. Typically, medical insurance covers the following:
- Hospitalization and Outpatient Expense: When insured individuals require hospitalization or receive medical services at outpatient clinics, the health insurance will cover a portion of the medical expenses.
- Critical Illness: For treatments resulting in high costs, health insurance provides additional coverage for medical expenses.
- Maternity Expenses: Female employees can have their medical costs related to pregnancy, childbirth, and maternity leave reimbursed through the health insurance.
Unemployment Insurance
Unemployment insurance provides financial support and basic living security for insured individuals who lose their jobs due to reasons beyond their control. In some regions, unemployment insurance also offers services like reemployment training and job placement assistance to help the unemployed find new work as quickly as possible.
Work Injury Insurance
Work injury insurance is designed to provide medical treatment and financial compensation to employees who suffer injuries or occupational diseases due to their work. In addition to injuries sustained during regular work hours, injuries from occupational diseases, accidents during work-related travel, accidents while commuting (if not the employee's fault), injuries during public service activities (such as disaster relief), or injuries during company-organized activities and training are all covered under work injury insurance. Employers are responsible for paying for this insurance, and employees do not contribute. If an employee unfortunately passes away due to a work-related injury, work injury insurance will cover funeral expenses and survivor benefits.
Maternity Insurance
Maternity insurance covers two main benefits: maternity medical expenses and maternity allowances. Maternity medical expenses cover costs such as checkups, surgeries, hospitalization, medications, and family planning surgeries related to pregnancy and childbirth for female employees. The maternity allowance compensates female workers for income loss during maternity leave. In some areas, maternity insurance also includes benefits for breastfeeding, such as breastfeeding allowances.
Section 2: How is the Payment Standard Determined?
From the previous content, you may wonder the question that how the amount of social insurance that my employer or I need to pay is determined? The answer comes as the social insurance contribution base.
The average monthly salary of an employee for the preceding year serves as the social insurance contribution base, including base pay, bonuses, allowances, and subsidies.
Contribution rates and minimum and maximum contribution bases are set and updated locally. Do not rely on a national percentage table or an undated city amount; confirm the current notices for the contribution month and employment location before calculating payroll.
Section 3: What Happens to My Social Insurance If I Leave China?
A foreign participant who leaves China before meeting pension eligibility may generally retain the account; if the participant applies in writing to terminate the social-insurance relationship, the balance in the individual pension account may be paid to the participant. The treatment of other insurance items and any treaty exemption should be reviewed separately.
Conclusion: Paying Social Insurance Won't Be a Burden!
Employer obligations, local contribution bases and rates, and any treaty exemption must be checked for the employment location and worker's status. If your case involves a new hire, a delayed contribution record, departure from China or a treaty exemption, you can book a compliance review with Hongda.
