What “five insurances and one fund” means
The term covers five social insurances and the housing provident fund. Social insurance is compulsory under the Social Insurance Law and is paid by both employer and employee; the housing fund is compulsory saving used for buying or renting a home.
Since maternity insurance merged into medical insurance, some people say “four insurances and one fund”, but the older phrase is still the common one.
- Pension insurance: Funds the basic pension paid monthly after retirement. Your own contributions go into your personal account.
- Medical insurance: Covers outpatient and hospital costs. Since 2019 maternity insurance has been merged into medical insurance and is paid together.
- Unemployment insurance: Pays unemployment benefits if you lose your job involuntarily.
- Work-injury insurance: Covers work-related accidents and illness; only the employer pays.
- Housing provident fund: Employer and employee usually pay the same rate and everything goes into your own account. You can withdraw it to buy a home, repay a mortgage or pay rent.
Employer and employee rates
On the employee side, social insurance takes about 10.5% and the housing fund 5–12%, so roughly 15–23% of the contribution base is deducted each month. The employer pays roughly a further 30–40% on top.
Employee social insurance and housing fund contributions are “special deductions” for individual income tax, so they also lower your tax.
| Item | Employer | Employee | Notes |
|---|---|---|---|
| Pension | 16% | 8% | Employee 8% to personal account; employer share to the pooled fund |
| Medical (incl. maternity) | About 6–10% (Beijing 9.8% including maternity and the 1% major medical mutual-aid fund; Shanghai 9%) | 2% (Beijing: 2% + 3 yuan a month) | Varies by city |
| Unemployment | 0.5–0.8% | 0.2–0.5% | 1% in total (2026: Shanghai 0.5% each; Guangzhou and Shenzhen employer 0.8%, employee 0.2%) |
| Work injury | 0.2–1.9% by industry | None | Adjusted by claims history |
| Housing fund | 5–12% | 5–12% (usually same as employer) | Shanghai basic fund: 5–7% |
Typical rates for 2026. Medical, unemployment, work-injury and housing fund rates differ by city, industry and employer and can change each year.
Contribution base and its limits
Contributions are calculated on a “contribution base”, not directly on your salary. The base is usually last year’s average monthly wage (the first month’s wage in your first year), with a floor of 60% and a cap of 300% of the provincial average wage.
If your pay is above the cap you contribute only up to the cap; below the floor you contribute on the floor. High earners therefore pay a smaller share of their actual salary.
New bases apply from July, but they are often announced in August or later, so the difference from July is settled afterwards in one go.
Employee contribution = contribution base (kept within floor and cap) × employee rate Example: Shanghai, base 20,000 yuan, housing fund 7% Pension 1,600 + medical 400 + unemployment 100 + housing fund 1,400 = 3,500 yuan a month
| City | Period | Floor (monthly) | Cap (monthly) |
|---|---|---|---|
| Beijing | Jul 2026 – Jun 2027 | 7,270 yuan | 36,348 yuan |
| Beijing | Jul 2025 – Jun 2026 | 7,162 yuan | 35,811 yuan |
| Shanghai | Jul 2026 – Jun 2027 | 7,546 yuan | 37,731 yuan |
| Shanghai | Jul 2025 – Jun 2026 | 7,460 yuan | 37,302 yuan |
Shanghai’s 2026 figures are 60% and 300% of its 2025 average wage of 12,577 yuan a month. The housing fund floor is set separately from social insurance.
Medical account reform and the housing fund
A 2021 State Council General Office guideline (Guobanfa [2021] No. 14) introduced pooled outpatient coverage. For working employees, only their own contribution (about 2% of the base) goes into the personal medical account; the employer’s share all goes into the pooled fund, which in return now pays part of ordinary outpatient costs.
The personal account balance can also pay medical bills and medicines for your spouse, parents and children. Retirees’ accounts receive a fixed amount from the pooled fund.
Both shares of the housing fund go into your own account. Housing fund loans carry lower rates than commercial loans (2.6% for a first home over five years in 2026), and the balance can be withdrawn for rent, a home purchase or at retirement.
Self-employed workers and moving cities
- Flexible employment: People without an employer can join pension and medical insurance as individuals. They pay 20% of the base for pension (8% to the personal account) and choose a base between the floor and cap. At Beijing’s 2026 floor that is 1,454 yuan a month for pension and 72.7 yuan for unemployment.
- Hukou restrictions: National policy is to remove hukou restrictions on joining where you work, but actual conditions differ, so check with the local social insurance office.
- Transferring records: When you change jobs to another city, your pension record is transferred and the contribution years are added together. You can apply online through the national social insurance public service platform or the “Zhangshang 12333” app; medical insurance can be transferred too.
Foreigners and the Korea–China agreement
Foreigners legally employed in China must join pension, medical, unemployment, work-injury and maternity insurance under the Interim Measures for Foreigners Employed in China. The employer must register them within 30 days of obtaining their employment documents, such as the work permit. Whether foreigners join the housing fund depends on the city.
The Korea–China social security agreement (signed October 2012, in force January 2013) prevents double contributions between Korea’s national pension and employment insurance and China’s basic pension and unemployment insurance. Staff seconded by a Korean employer are exempt from Chinese pension and unemployment insurance for up to five years (extendable by up to eight more years if both sides agree), and Korean nationals hired locally who keep paying the Korean national pension can also be exempt for up to five years.
Medical and work-injury insurance are not covered by the exemption, so they must be paid in China. To claim the exemption you obtain a certificate of coverage from Korea’s National Pension Service and submit it to the Chinese social insurance office.
A foreigner who leaves China before pension age keeps the personal account and can continue it on returning to work, or can apply in writing to receive the account balance as a lump sum.
Comparison with Korea’s four major insurances
The biggest difference is the housing fund. Because the employer’s share also goes into your account, you need to look at both take-home pay and the fund balance to see your real compensation.
| Area | China | Korea |
|---|---|---|
| Pension | Pension insurance: employer 16% + employee 8% | National Pension: 9.5% split equally (2026) |
| Health | Medical insurance: employer about 6–10% + employee 2% | Health insurance 7.19% split equally + long-term care |
| Unemployment | Unemployment insurance: about 1% in total | Employment insurance: employee 0.9% + employer |
| Work injury | Work-injury insurance: employer only | Industrial accident insurance: employer only |
| Housing | Housing fund: 5–12% each, own account | No equivalent compulsory scheme |
| Base | 60–300% of the local average wage | National Pension income floor and cap (adjusted each July) |
FAQ
Do I pay during probation?
Yes. The Social Insurance Law requires registration within 30 days of starting work, and probation is included. Housing fund contributions also start after joining, under city rules.
What if my employer reports only the minimum base?
The base should reflect actual wages. Under-reporting reduces later benefits such as your pension and unemployment benefit. You can check your base in social insurance or tax apps and contact the labour inspection authority if it is wrong.
What happens if I stop paying for a while?
Pension years already paid are kept and continue when you resume. Medical cover stops while unpaid, and some cities apply a waiting period after you rejoin.
I was seconded from Korea. Do I still pay Chinese medical insurance?
Yes. The agreement only exempts pension and unemployment insurance, so medical and work-injury insurance are paid in China. Housing fund rules for foreigners vary by city.
Basis and sources
- 北京市人力资源和社会保障局 — 关于2026年度各项社会保险缴费工资基数上下限的通告（京人社发〔2026〕7号）
- 上海市人力资源和社会保障局 — 本市调整2026年度社保缴费基数上下限
- 上海市医疗保障局 — 关于继续阶段性降低本市职工基本医疗保险费费率的通知（2026）
- 中国政府网 — 国务院办公厅关于建立健全职工基本医疗保险门诊共济保障机制的指导意见（国办发〔2021〕14号）
- 中国政府网 — 在中国境内就业的外国人参加社会保险暂行办法（人力资源社会保障部令第16号）
- 中国政府网 — 人力资源社会保障部关于修改《在中国境内就业的外国人参加社会保险暂行办法》的决定（人力资源社会保障部令第54号，2024年12月）
- National Pension Service (Korea) — Korea–China Social Security Agreement
- 人力资源和社会保障部