OIT - Inclusive social insurance

X Inclusive social insurance Exploring real solutions to reach the self-employed Authors / Shea McClanahan, Holly A. Seglah, Daisy Sibun, Anasuya Sengupta

July / 2026 ILO Working Paper 176© International Labour Organization 2026 Attribution 4.0 International (CC BY 4.0) This work is licensed under the Creative Commons Attribution 4.0 International. See: https:// creativecommons.org/licenses/by/4.0/. The user is allowed to reuse, share (copy and redistribute), adapt (remix, transform and build upon the original work) as detailed in the licence. The user must clearly credit the ILO as the source of the material and indicate if changes were made to the original content. Use of the emblem, name and logo of the ILO is not permitted in connection with translations, adaptations or other derivative works. Attribution – The user must indicate if changes were made and must cite the work as follows: McClanahan, S., Seglah, H., Sibun, D., Sengupta, A. Inclusive social insurance: Exploring real solutions to reach the self-employed. ILO Working Paper 176. Geneva: International Labour Office, 2026.© ILO. Translations – In case of a translation of this work, the following disclaimer must be added along with the attribution: This is a translation of a copyrighted work of the International Labour Organization (ILO). This translation has not been prepared, reviewed or endorsed by the ILO and should not be considered an official ILO translation. The ILO disclaims all responsibility for its content and accuracy. Responsibility rests solely with the author(s) of the translation. Adaptations – In case of an adaptation of this work, the following disclaimer must be added along with the attribution: This is an adaptation of a copyrighted work of the International Labour Organization (ILO). This adaptation has not been prepared, reviewed or endorsed by the ILO and should not be considered an official ILO adaptation. The ILO disclaims all responsibility for its content and accuracy. Responsibility rests solely with the author(s) of the adaptation.

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Authorization for publication: Shahra Razavi, Director, Labour and Social Protection Department ILO Working Papers can be found at: www.ilo.org/research-and-publications/working-papers Suggested citation: McClanahan, S., Seglah, H., Sibun, D., Sengupta, A. 2026. Inclusive social insurance: Exploring real solutions to reach the self-employed, ILO Working Paper 176 (Geneva, ILO). https://doi.

org/10.54394/0003453601 ILO Working Paper 176 Abstract Self-employed workers, including own-account workers, are at the forefront of a changing world of work, while also representing the majority of informal workers in lowand middle-income countries. Large numbers of them are in vulnerable employment, with no access to basic labour market protections, including social security. Despite the growing body of research on the extension of social insurance to self-employed workers, further research is needed to broaden and deepen the evidence base of country examples. This paper attempts to fill this gap through the presentation of eight distinct country examples of extension of social protection to self-employed workers. One of the key aims of this paper is to collect evidence on the views and experiences of potential and existing beneficiaries of different policies and mechanisms. Highlighting the continuing resilience of social insurance schemes in low-and middle-income countries, the paper examines the specific challenges of adapting social insurance schemes to the needs of self-employed workers in different contexts. The exto collect evidence on the views and experiences of potential and existing beneficiaries of different policies and mechanisms. Highlighting the continuing resilience of social insurance schemes in low-and middle-income countries, the paper examines the specific challenges of adapting social insurance schemes to the needs of self-employed workers in different contexts. The examples featured in this report represent an attempt to develop more permanent solutions for self-employed workers from varied starting points and reveal a wide range of potential strategies. Identifying common threads across these diverse experiences can therefore provide a basis for informing the development of global policy guidance. Foreword The world of work is rapidly being reshaped. Demographic transitions, technological innovation and the growing prominence of new forms of work interact with a range of crises, including climate change, conflicts and geopolitical volatility, to amplify existing vulnerabilities and create new challenges to decent work. In this context, realising comprehensive and adequate social protection for all is more critical and urgent than ever. Yet, despite the important progress made in extending social protection coverage worldwide,1 vast gaps remain. Many self-employed workers find themselves without adequate social protection. Many of them are part of the informal economy, which accounts for 58 per cent of global employment or nearly two billion workers.2 In fact, almost two thirds of workers in the informal economy (64 per cent) globally are self-employed, and the proportion rises to four fifths (79 per cent) in some low-income-countries. This makes it all the more important to enhance access to social security for self-employed workers by adapting the design, financing and implementation of social security schemes to achieve universal social protection, recognizing that social protection is one of the pillars of decent work, while facilitating transitions from the informal economy. This growing necessity for extension of social protection systems in a changing world of work is being increasingly recognised in various international fora. The Second World Summit for Social Development recognized social protection as one of the key enablers for the eradication 1 ILO, World Social Protection Report 2024-26: Universal social protection for climate action and a just transition, 2024.

is being increasingly recognised in various international fora. The Second World Summit for Social Development recognized social protection as one of the key enablers for the eradication 1 ILO, World Social Protection Report 2024-26: Universal social protection for climate action and a just transition, 2024. 2 ILO, Women and men in the informal economy: A statistical update, 2023.02 ILO Working Paper 176 of poverty, the promotion of decent work and full and productive employment, and social inclusion.3 The G20 Call to Action on Universal Social Protection Systems and Floors4 highlights the need to address the equitable distribution of risk and sustainable financing of social protection. The resolution of the International Labour Conference on addressing informality and promoting the transition to formality for decent work5 also emphasises the central role that social protection plays in decent work and therefore, formalization processes. At the national level, many governments have already recognized the importance of extending social security to self-employed workers, and are looking for systematic evidence on what works in practice and pioneering various policies. Demonstrating that social protection systems can adapt to new realities, this paper offers a comprehensive assessment of country practices in extending social security coverage to the self-employed: what policies and promising practices have emerged, and what obstacles and shortcomings remain. It also amplifies the perspectives of self-employed workers themselves, including those in informal employment, through original qualitative research conducted in Thailand and Uruguay. It is important to emphasise that rights-based and effective formalization efforts require social protection systems that provide adequate and comprehensive benefits to all, grounded in rights, governed in an inclusive way and financed sustainably and equitably, based on solidarity between capital and labour, rich and poor, men and women. Reflecting these principles, social insurance schemes constitute a key element of comprehensive social protection systems that can provide adequate benefit levels, contributing to income security and access to healthcare. At the same time, tax-financed schemes play an important role in guaranteeing at least a basic level of protection for all at critical life-stages through universal child benefits, universal old-age pensions,

adequate benefit levels, contributing to income security and access to healthcare. At the same time, tax-financed schemes play an important role in guaranteeing at least a basic level of protection for all at critical life-stages through universal child benefits, universal old-age pensions, or social assistance as well as national health services. Together with accessible, affordable and quality care services, national social protection systems are essential for ensuring that workers in all types of employment, including self-employment, and their families enjoy income security and access to essential healthcare without financial hardship throughout their life course. The report highlights that, across the board, successful efforts in extending social security to self-employed workers are grounded in legal and policy frameworks and take a system-wide perspective in integrating the extension of social protection with other economic and social policies to facilitate formalization. The diverse case studies illustrate that enabling the inclusion of currently informal workers into national schemes, where necessary through temporarily subsidized contributions, provides greater opportunities for supporting decent work and labour mobility compared to more fragmented approaches. Aligning contributory and tax-financed schemes, and coordinating benefits and incentives all help create coherent systems that both extend protection and foster formalization. As self-employed workers are responsible for their own registration, ensuring simplified processes and documentation requirements, as well as leveraging digital solutions and one-stop shops is key. Given their diverse work, care and earnings schedules, offering flexibility with respect to the administrative requirements, the access points for interfacing with social security or tax authorities, the levels and timing of contributions, and the scope and level of benefits provided is 3 UN General Assembly, resolution 80/5, Doha Political Declaration of the “World Social Summit” under the title “the Second World Summit for Social Development”, A/RES/80/5, adopted on 4 November 2025. 4 G20, Development Working Group. Call to Action: Towards inclusive, resilient and sustainable development through Universal Social Protection Systems and Floors. Final Draft, 2025. 5 ILO, Resolution concerning the general discussion on addressing informality and promoting the transition to formality for decent

4 G20, Development Working Group. Call to Action: Towards inclusive, resilient and sustainable development through Universal Social Protection Systems and Floors. Final Draft, 2025. 5 ILO, Resolution concerning the general discussion on addressing informality and promoting the transition to formality for decent work, International Labour Conference, 113th Session, 2025.03 ILO Working Paper 176 critical. Above all, the report showcases that successful efforts to expand coverage are grounded in systematic and trust-based collaboration with workers organizations. By documenting how countries around the world have successfully extended protection to self-employed workers, this paper demonstrates how national social security systems are able to adapt to evolving labour market conditions. These insights are invaluable and point to the need to understand the experiences and preferences of self-employed workers, who too often remain unheard in policy debates. We hope that this report inspires more in-depth research and engagement on these and other critical issues on the extension of social security to all. Shahra Razavi, Director, Labour and Social Protection Department, International Labour Organisation (ILO) Laura Alfers, International Coordinator, Women in Informal Employment: Globalizing and Organizing (WIEGO) About the authors Shea McClanahan is a Senior Officer in Social Security and Social Policies at the International Social Security Association (ISSA), specializing in social security system design, coverage extension, inter-institutional coordination and linkages with broader social and economic policies. Shea was a Senior Social Policy Specialist at Development Pathways at the time of writing. Holly A. Seglah is currently a PhD Candidate at the University of New South Wales, Sydney, Australia. Here, she is a part of an Evacuations Research Hub where she explores international children’s rights and evacuations from disasters. With a background in international development and humanitarian action, she has conducted interdisciplinary research and advocacy on universal social protection, inclusive disaster risk reduction and the role of non-discrimination under international human rights. At the time of writing, she was a Social Policy Officer at Development Pathways. Daisy Sibun is a Social Protection Specialist at the Australian Government-funded Partnerships

on universal social protection, inclusive disaster risk reduction and the role of non-discrimination under international human rights. At the time of writing, she was a Social Policy Officer at Development Pathways. Daisy Sibun is a Social Protection Specialist at the Australian Government-funded Partnerships for Social Protection programme. She is currently working as an advisor to the Fiji Government's Ministry of Women, Children and Social Protection based in Suva, Fiji. Daisy was a Social Policy Specialist at Development Pathways at the time of writing. Anasuya Sengupta is a senior social protection consultant, working on the intersections between gender, informality and access to social security. For over 20 years, she has led studies and assessments in East Africa, the Asia-Pacific and MENA. She specialises in qualitative research methods, and community and participatory approaches. Anasuya holds a Masters’ degree from the Institute of Development Studies, United Kingdom. She was a Senior Social Policy Specialist at Development Pathways at the time of writing.04 ILO Working Paper 176 Abstract 01 Foreword 01 About the authors 03 Acronyms 09 Executive Summary 10 X Introduction 12 X 1 Global overview of access of self-employed workers to social protection systems 14 Broader debates around social insurance 14 Challenges faced by self-employed workers vis-à-vis social insurance schemes 16 Extending coverage to the self-employed – the big questions 21 Key concepts and trends 27 Self-employment – global definition and evolution 27 Informal employment and self-employment 29 Disguised employment and dependent self-employment 32 X 2 Comparative overview of country cases 35 Selection and overview of cases 35 Structure of case studies 44 X 3 Leverage on key policy choices and debates 46 Legal and policy framework 46 Voluntary versus mandatory participation 47 Improving attractiveness through relevant benefits and incentives 48 Appropriate financing mechanisms to tackle affordability challenges 54 Lowering administrative barriers to address access challenges 57 Enhancing awareness and representation by leveraging workers’ organizations 58

Legal and policy framework 46 Voluntary versus mandatory participation 47 Improving attractiveness through relevant benefits and incentives 48 Appropriate financing mechanisms to tackle affordability challenges 54 Lowering administrative barriers to address access challenges 57 Enhancing awareness and representation by leveraging workers’ organizations 58 X 4 Enabling or hindering factors and enduring challenges 61 Enabling or hindering factors 61 Enduring challenges 62 X Conclusion 67 Table of contents05 ILO Working Paper 176 Annex Contribution rates of main statutory schemes in the countries represented in the case studies 69 References 73 Acknowledgements 7806 ILO Working Paper 176 List of Figures Figure 1. Evolution of social security legislation, globally, by branch 15 Figure 2. Depiction of the prevailing bifurcated social security model in many lowand middle-income countries 17 Figure 3. Percentage of EU Member States providing legal coverage for self-employed workers, by social security branch (2018) 18 Figure 4. Proportion of the working population living below various international poverty lines 19 Figure 5. Uncoordinated approach to tax-financed benefits 24 Figure 6. Multi-tiered social security approach to tax-financed benefits 25 Figure 7. Definition of self-employment and vulnerable employment based on ICSE-93 classifications (revised in 2018) 28 Figure 8. Share of self-employment as a percentage of total employment, by country income 29 Figure 9. Definition of informal employment in self-employment based on ICSE-93 classifications (revised in 2018) 30 Figure 10. Informal employment as a share of total employment, by status in employment 31 Figure 11. Distribution of total global informal employment, by status in employment and sex (percentages) 32 Figure 12. Distribution of total employment by status in employment in selected case study countries (latest year available) 42 Figure 13. Rate of informal employment by status in employment in selected cases (percentFigure 11. Distribution of total global informal employment, by status in employment and sex (percentages) 32 Figure 12. Distribution of total employment by status in employment in selected case study countries (latest year available) 42 Figure 13. Rate of informal employment by status in employment in selected cases (percentage, latest year available) 43 Figure 14. Distribution of informal employment by status in employment (latest year available) 44 Figure 15. Summary of benefits provided to self-employed workers under voluntary and mandatory arrangements in a selection of case studies 53 Figure 16. Statutory contribution rates for formally employed workers, by status in employment 5407 ILO Working Paper 176 List of Tables Table 1: The “Five As” of coverage extension – a common framework for exploring challenges and solutions 36 Table 2. Description of eight short cases 38 Table 3. Main enduring challenges 6408 ILO Working Paper 176 List of Boxes Box 1. Experiences with voluntary insurance for self-employed workers in OECD countries 23 Box 2. Designing multi-tiered social security systems that guarantee minimally adequate protection while promoting social insurance 24 Box 3. Innovative financing mechanisms for self-employed workers 26 Box 4. False assumptions about uninsured wage earners and social insurance in Vietnam 32 Box 5: Beneficiary perspectives on measures to extend social security to self-employed workers from the case study countries 49 Box 6. Examples of additional incentives to formalize in order to reduce overall costs in Brazil, Cabo Verde and Uruguay 52 Box 7. At the intersection of affordability and attractiveness – getting the incentives right under special tax/social security regimes in Brazil and Uruguay 56 Box 8. Costa Rica’s collective insurance agreements enhance bargaining power and affordability of coverage of self-employed rural workers 5909 ILO Working Paper 176 Acronyms BPS Banco de Previsión Social CASNOS Caisse Nationale de Sécurité Sociale des Non-Salariés (National Social Security Fund for Non-Wage Earners – Algeria)

bility of coverage of self-employed rural workers 5909 ILO Working Paper 176 Acronyms BPS Banco de Previsión Social CASNOS Caisse Nationale de Sécurité Sociale des Non-Salariés (National Social Security Fund for Non-Wage Earners – Algeria) CCSS Caja Costarricense de Seguridad Social (Costa Rican Social Security Fund) CNSS Caisse Nationale de Sécurité Sociale (National Social Security Fund) – Tunisia ECIS Extension of Coverage to the Informal Sector – Zambia EU European Union GPF Government Pension Fund - Thailand ICSE International Classification by Status in Employment ICT Information and communication technology ILOSTAT International Labour Organization Statistics Department INPS Instituto Nacional de Previdencia Social (National Institute for Social Welfare) – Cabo Verde ISSA International Social Security Association MEI Microemprendedor Individual – Brazil MENA Middle East and North Africa MIDES Ministerio de Desarrollo Social (Ministry of Social Development) – Uruguay MoLESS Ministry of Labour, Employment and Social Security – Algeria MSE Micro and Small Enterprises – Brazil NAPSA National Pension Scheme Authority – Zambia OECD Organization for Economic Co-Operation and Development REMPE Social Micro and Small Business Tax Regime RTFR Régime des travailleurs de faibles revenus (Scheme for Low-income Workers) – Tunisia SPIREWORK Social Protection for Informal and Rural Economy Workers – Zambia SSF Social Security Fund – Thailand10 ILO Working Paper 176 Executive Summary Governments around the world grappling with this challenge are finding their way to extending social protection to self-employed workers. Drawing from ten country case studies, this paper has attempted to shed light on a set of ongoing debates surrounding the design and implementation of solutions to extend social insurance coverage to self-employed workers. The solutions do not readily lend themselves to easy classification, but they speak to some of the key debates identified in the literature: ● Incorporating self-employed workers into the general scheme but devising specific mechanisms to encourage their participation, as in Cabo Verde, Costa Rica, Mongolia and Portugal,

do not readily lend themselves to easy classification, but they speak to some of the key debates identified in the literature: ● Incorporating self-employed workers into the general scheme but devising specific mechanisms to encourage their participation, as in Cabo Verde, Costa Rica, Mongolia and Portugal, versus designing special schemes for self-employed or even defined groups of self-employed, as in Algeria and, broadly speaking, Tunisia. The review showed that the debate between general versus special schemes is more complex than is typically appreciated, largely because some of the featured cases fall somewhere in the middle: Brazil, Uruguay, Thailand, as well as Zambia’s pilots, are administered within the institutional framework of the general scheme, while providing dedicated parameters for self-employed workers. ● Devising simplified and unified tax and social security mechanisms for specific groups of workers, as in Brazil and Uruguay. These monotax mechanisms have shown a high degree of success in addressing affordability and access challenges but, as revealed by the cases, they have struggled in different ways to align the benefit and incentive structure to enable self-employed workers to attain the promise of full coverage and obligations. ● Instituting voluntary participation, as in Mongolia and Thailand, which places a premium on pull factors – subsidies, benefits tailored to the needs of self-employed workers – and communication campaigns, while relieving the state of the need to invest in push factors like compliance enforcement. The review suggested that the experiences with voluntary participation have, by and large, not lived up to the expectations that many had for them, even if they have shown some expansion and provided opportunities for learning and innovation with regards to other dimensions, such as the one-stop shops in Mongolia. ● Mandating participation under compulsory schemes, as in most benefits for self-employed workers in Algeria, Cabo Verde, Costa Rica, Brazil, Tunisia and Uruguay. Very little information was available on enforcement in these schemes, but Costa Rica’s investments were noted as instrumental in increasing coverage and there is evidence from the qualitative research that registrants in Uruguay were responsive to the “negative incentive” of being subjected to inspections. Moreover, the fact that most of the countries selected from the small universe of

was available on enforcement in these schemes, but Costa Rica’s investments were noted as instrumental in increasing coverage and there is evidence from the qualitative research that registrants in Uruguay were responsive to the “negative incentive” of being subjected to inspections. Moreover, the fact that most of the countries selected from the small universe of noteworthy expansion had mandatory schemes suggests that this was likely an important driver of success. ● Offering some degree of flexibility with respect to the administrative requirements, the access points for interfacing with social security or tax authorities, the levels and timing of contributions, and the scope and level of benefits provided. Indeed, some degree of flexibility for self-employed workers was present in all cases examined, highlighting the necessity of devising flexible schemes to respond to the diverse challenges faced by the self-employed. Notably, the studies aimed to fill at least two major gaps in the literature on the extension of social insurance more broadly, as well as specifically to self-employed workers. One key finding from the review was that some of the key gaps that the studies aimed to fill still remain. In particular, there was very little information in the written record from the cases on the perspectives of beneficiaries (or potential beneficiaries) vis-à-vis the mechanisms and strategies employed to11 ILO Working Paper 176 encourage their participation in the schemes. Of the eight cases, only three – Brazil, Mongolia and Zambia – reported evidence on beneficiaries’ perspectives. Similarly, little information was available on the impacts of the schemes on self-employed workers’ incomes or wellbeing. Ultimately, the review suggests that self-employed workers’ decisions regarding whether or not to participate in social insurance are as complex as the schemes designed to reach them. Successfully reaching the self-employed population will require continual innovation. Perhaps the most important message from the review is that the most effective solutions are those that take a system-wide perspective and tend towards greater integration and policy coordination, aligning (a) tax-financed and contributory components of the social protection system, (b) all contributory schemes, (c) tax and social security systems and (d) benefits and incentives to

those that take a system-wide perspective and tend towards greater integration and policy coordination, aligning (a) tax-financed and contributory components of the social protection system, (b) all contributory schemes, (c) tax and social security systems and (d) benefits and incentives to encourage the extension of social insurance and the formalization of employment. Self-employed workers deserve adequate social protection as a core element of decent work.12 ILO Working Paper 176 X Introduction Globally, self-employed workers continue to lack social protection coverage. Historically, they have largely been left out of social insurance schemes and incorporating them poses challenges even for high-income countries. Despite the growing body of research on the extension of social insurance to self-employed workers, further research is needed to broaden and deepen the evidence base of country examples. In particular, very little is known about the impacts on self-employed work