Calculate your disability income insurance needs in Israel. Enter monthly net income, state disability benefit, and monthly expenses to find your coverage gap and recommended monthly benefit in ILS.
Enter your monthly income, state disability benefit, and living expenses to find your income protection gap and recommended monthly cover amount.
Recommended monthly benefit
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Monthly net income
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State disability benefit
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Monthly coverage gap
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Annual benefit required
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Your breakdown
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Understanding the income protection gap in Israel
Most working Israelis who become disabled through illness or injury face a significant gap between what the state pays and what they need to live on. Bituach Leumi disability payments are means-tested and capped at a relatively low level. For someone earning 15,000 ILS per month with monthly expenses of 11,000 ILS, even receiving the maximum state benefit of around 6,000 ILS still leaves a gap of 5,000 ILS per month. Over a year that is 60,000 ILS of unmet expenses, and over a decade it exceeds 600,000 ILS before any interest or inflation adjustment.
How private income protection policies work in Israel
Private income protection is bought from licensed Israeli insurers and pays a fixed monthly benefit once a waiting period (deductible period) has passed. The waiting period is typically 30, 60, 90, or 180 days after the onset of the disability. A longer waiting period means lower premiums but requires a larger emergency fund to bridge the gap. Most policies pay until age 60 or 67. Premiums are based on your occupation, age, benefit amount, waiting period, and health history. Risky occupations such as construction, security, or agriculture attract higher premiums.
Key decisions when buying income protection in Israel
Three decisions drive most of the value from your policy. First, choose a benefit amount that covers the gap between your monthly expenses and your expected state benefit, but no more than 75 percent of your net income (most insurers apply this cap). Second, pick a waiting period that matches your emergency fund. If you have three months of expenses saved, a 90-day waiting period reduces premiums significantly. Third, confirm the policy definition of disability: own-occupation definitions (unable to do your specific job) provide better protection than any-occupation definitions (unable to do any job). Own-occupation is more expensive but avoids disputes about whether you could theoretically do different work.
Frequently asked questions
What does the Israeli state pay if I become disabled and cannot work?
Bituach Leumi (National Insurance Institute) provides a disability allowance (Kitzba Nechut) to residents assessed as at least 40 percent disabled who meet the income and contribution tests. The full benefit in 2025 is approximately 4,200 to 6,000 ILS per month depending on degree of disability and household composition. This is significantly below the average Israeli salary of around 13,000 to 14,000 ILS per month, creating a substantial gap for most earners.
How does private income protection insurance work in Israel?
Private income protection (Bituach Itzvur Kosher Avoda or Bituach Knesset) pays a monthly benefit if you are unable to work due to illness or injury. You choose a benefit amount (typically up to 75 percent of pre-disability net income), a waiting period (30 to 180 days before payments start), and a benefit period (to age 60 or 65 in most Israeli policies). Premiums are tax-deductible for self-employed individuals. Employees may have group cover through their employer, so check your employment package before buying additional coverage.
Can self-employed people in Israel get income protection?
Yes. Self-employed individuals (Atzmai) are eligible for both Bituach Leumi disability benefit and private income protection policies. For the self-employed, private cover is especially important because their income is more volatile and they have no employer sick-pay scheme. Premiums paid for income protection are deductible against business income for tax purposes, reducing the net cost of the policy. Ensure you declare your business income accurately to Bituach Leumi so your benefit entitlement reflects your actual earnings.
What is the capitalisation method used in this calculator?
The capitalisation method estimates the lump-sum capital required to generate a given monthly income stream. Dividing the annual income gap by a capitalisation rate of 7 percent (0.07) gives the approximate fund needed to sustain that income indefinitely at a real return of 7 percent per year. For example, a monthly gap of 5,000 ILS equals an annual gap of 60,000 ILS, and 60,000 divided by 0.07 equals approximately 857,000 ILS. This is one way to express the total value of the coverage you need, though in practice income protection is purchased as a monthly benefit rather than a lump sum.