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Ecuador - The case of the Peasants Social Insurance
Figure 10. Ecuador: Coverage of independent farming workers, 2005
Source: Instituto Nacional de Estadística y Censos, 2006a.
8.3. Innovations in Peasants’ Social Insurance
SSC is a replacement social security scheme, created with the aim of extending coverage through farming organizations. This aim is expressed in Article 2 of the Social
Security Law 2001, which establishes the following: ―… The following are required to request the protection of the Peasants‘ Social
Insurance special scheme: workers dedicated to artisanal fishing and rural inhabitants ‗usually‘ working in the countryside, on their own account or on the account of the
community they belong to, who do not receive compensation from a public or private employer, and who do not hire people from outside the community or third parties to
perform economic activities under their purview ‖.
The main elements of this type of insurance are listed in table 10.
Table 11. Ecuador: Main characteristics of the Rural Social Insurance
Application scope
SSC insured or retired head of household. Hisher spouse or cohabiting partner.
Hisher dependent children and relatives.
Benefits
Health promotion, prevention, environmental sanitation and community development; preventive and recovery dental care; care during
pregnancy, delivery, and puerperium. Disability and old age pensions.
Funeral support.
Innovations in extending social insurance coverage to independent workers
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Requirements
Individual registration: Verbal request by the head of household or registrable family member.
Copy of the identity documents of the head of household and hisher dependents. In the absence of such documents, an original birth
certificate must be presented. Organization Registration:
Written request by an organization representative. The organization must be located in a rural area. It must be active, have a
general and permanent nature, and be open. Its mission must be the overall development of the community.
Most of its members must express the desire to register. A community diagnosis must be approved by SSCs Insurance and
Benefit Supervision Sub-management. Admission must be approved by SSC Management.
Source: Instituto Ecuatoriano de Seguridad Social, 2012.
The SSCs main innovations are listed below.
8.3.1. Focus on rural population coverage
From its beginning, the SSC has been a social insurance option directly targeting the rural population, assuming that national solidarity should be addressed to the most
vulnerable population, with the aim of providing solutions for their needs. The SSC is based on the principle of universality, according to which social security must be extended
to the whole of the Ecuadorian population.
According to data by Ecuadors
Instituto Nacional de Estadística y Censos
National Institute of Statistics and Census 2006b, the SSC is the main social security mechanism
for the rural population, which comprises around 4.5 million people. The percentage of SSC registrants is 73 per cent, whereas the second most important insurance mechanism is
the IESS general insurance 23 per cent, the remaining 4 per cent being divided among ISSPOL, ISSFA, and other insurance mechanisms.
8.3.2. Highly subsidized financing model
The SSC financing structure is based on the solidarity principle, which is why the registrants contribution is minimal, when compared to other resources in the financing of
insurance. Its financing structure is highly subsidized. It comprises the solidary contributions of employers and of General Mandatory Insurance registrants, both with and
without a dependency relationship, the mandatory contribution of public and private insurance integrating the National Social Security System, the contributions of families
protected by the Rural Insurance, and the States contribution.
According to Durán-Valverde 2008, the main SSC contributions established in Articles 5 and 136 of the Social Security Law are the following:
1 Solidary contribution borne by employers, calculated on the basis of taxable income tax base of those registered in the General Mandatory Insurance scheme, either with
or without a dependency relationship, and of voluntary scheme registrants. 2 Mandatory contributions by public and private insurances integrating the Social
Security National System.
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Ecuador - The case of the Peasants Social Insurance
3 The differentiated contribution of families protected by the Rural Social Insurance, corresponding to 2 per cent and 3 per cent of the portion of the minimum contribution
salary of those registered under a dependency relationship. 4 The States mandatory financial contribution to the General Mandatory Insurance on
the tax base of registrants with a dependency relationship, and 5 Other allocations made by the Executive to finance that insurances solidary benefits,
in accordance with the Laws General Regulation.
8.3.3. Important geographic presence and service infrastructure
The SSC is characterized by an integral service structure, through which it has a remarkable regional presence.
Currently, it has 597 dispensaries divided among Ecuadors 24 provinces. These dispensaries are the units through which beneficiaries have access to the health benefits
mentioned in table 10. It is important to mention that when it comes to other types of specialized medical
care, registrants may choose to resort to the medical units of the general individual and family health insurance, as well as to other units which have agreements with the IESS.
8.3.4. Management Structure
As previously mentioned, the SSC is a specialized scheme managed by the IESS, although it holds sufficient administrative independence within the national social security
management structure. This is particularly useful in that it ensures the support of the authority governing social security.
SSC management is under the responsibility of the management of the Rural Social Insurance. This bodys main functions are insurance procedure management, pensions
delivery, health and cash benefits, and acquiring medical care services. Furthermore, as mentioned by Durán-Valverde 2008, SSC rural dispensaries are subject to this
insurances management.
In short, Durán-Valverde 2008, p. 116 indicates that operationally the SSC ―is
characterized by operating under a model of geographical de-concentration and operative decentralization, under the hierarchy of SSCs Management, which in turn reports to IESS
general management, and must submit its policies and programmes to the approval of that entitys Board of Directors
‖.
8.3.5. Great importance in the national political scene
Throughout its development, the SSC has adopted a promoting role in building social security which has filtered into other spheres of the Ecuadorian society, facilitating the
strengthening of the leadership role of rural organizations in the political arena. Around the SSC a series of rural organizations and federations were built up, and
have come to play lead roles in political representation for people in the rural sector and throughout the country more generally. The numbers involved in the Unified Federation of
the Peasants‘ Social Insurance and of the National Confederation of the Peasants‘ Social Insurance make these organisations particularly prominent. These two organizations
incorporate the great majority of farmers. Other farmers organizations are also included, such as the National Federation of Rural Organizations, the National Federation of Native
