Updated by Carla Alcobia on 24.06.2014
Guatemalan social protection is characterized by limited coverage and segmentation along socio-economic lines. Formal sector workers have access to the country’s social security system consisting of several different schemes. Those not covered by these social security schemes may benefit from social assistance and public services. Private insurance and services are also available for those with the means to pay. In recent years, non-contributory cash transfers to the poor and other policies have been introduced in order to reduce poverty and counter traditional exclusion patterns in social protection.
The backbone of the country’s contributory social security is the Guatemalan Social Security Institute (Instituto Guatemalteco de Seguridad Social, IGSS), which was established in 1946. It offers social security benefits to enrolled workers, mainly in the formal economy. In principle, IGSS membership is compulsory for formal sector companies with three or more employees. According to the Institute’s official data, there were 1,185,866 members in 2012. However, the number of people who regularly contribute to the general social security scheme represents only about 25 per cent of the economically active population. IGSS coverage is thus low and continues to be limited mainly to the urban non-poor. Financed by contributions from workers, employers and the state, IGSS provides pensions to the elderly, disabled and survivors and cash benefits and health services in case of illness, maternity and accidents. It also guarantees health services for insured workers, their pregnant spouses during pregnancy and their children below the age of seven.
In addition to the IGSS, there are two other public obligatory social security schemes: one for civil servants (Clases Pasivas Civiles del Estado, CPCE), established in 1923, and another for the military (Instituto de Previsión Militar, IPM), established in 1966. In addition, smaller schemes provide services to the workers of public enterprises, banks, municipal organizations and other public bodies, the members of which are also covered by IGSS, thus enjoying a double protection.