Prepayment discount

What is a prepayment discount?

A prepayment discount is a price reduction for paying quickly or early. In health insurance, it means a reduction on the premium if you do not pay monthly but several months in advance, for example for half a year or a whole year. In Switzerland it is usually called a “Skonto”, a word that comes from the Italian “sconto”, meaning deduction.

In basic health insurance, the prepayment discount is a voluntary benefit offered by the insurer. The law requires the premium to be paid in advance and as a rule monthly. However, it does not oblige the insurer to offer longer payment periods or to reward them. That is why insurers differ: some give a discount for annual payment, some already for half-yearly payment, others none at all.

The prepayment discount should not be confused with other premium discounts. The discount for a higher deductible or for a GP or telemedicine model is precisely regulated by law and is already included in the FOPH’s official monthly premiums. The prepayment discount, on the other hand, only appears on the invoice and is missing from the official premium data.

Prepayment discounts also exist in supplementary insurance. There, the contract determines whether there is one and how high it is.

How it works

You choose a longer payment period with your insurer, for example via a form, the customer portal or by phone. The insurer then invoices you for the premium for the whole period at once and deducts the discount directly. The premium remains payable in advance: the annual invoice must therefore be paid in January, the half-yearly invoices in January and July.

The discount usually comes with a few conditions that each insurer sets itself:

• Payment period: often the discount is only available for annual payment, sometimes also on a sliding scale for half-yearly payment.
• Payment on time: if you pay the advance invoice late, the discount may be lost.
• Scope: some insurers grant the discount only on basic health insurance, others also on supplementary insurance.

If you leave the insurer during the period, for example because you move abroad or switch as of 1 July, you get back the premium for the months after you leave. How the discount is offset in this case is set out in the insurer’s conditions.

You can find more on payment intervals under premium payment.

Legal basis

There is no article on prepayment discounts in health insurance law. The relevant provision is Art. 90 of the Health Insurance Ordinance (KVV): premiums must be paid in advance and as a rule monthly. The wording “as a rule” leaves the insurer room for other payment periods; whether it grants a discount for them is up to the insurer, which sets this out in its rules.

Art. 61 para. 1 of the Federal Health Insurance Act (KVG) requires an insurer to charge its insured persons the same premiums in principle. Two statutory interest rates help to put this into perspective: on late premiums, the insurer may charge default interest of 5% per year (Art. 105a KVV), and on overpaid premiums of more than CHF 3,000 that it does not refund within six months, it owes you remunerative interest of 5% (Art. 90a KVV).

Supplementary insurance is governed by the Insurance Contract Act (ICA). Under Art. 19 ICA, the premium is due in advance for an insurance period of one year if nothing else is agreed. Whether the insurer provides a discount for annual payment or a surcharge for monthly payment is governed by the contract conditions.

Example: what a prepayment discount is worth in francs

Nina, 36, lives in the city of Bern and has a deductible of CHF 2,500. The median monthly premium of all 126 offers for her year of birth is CHF 482.70, making an annual premium of CHF 5,792.40 (2026 premiums, municipality of Bern, region 1, adults, with accident cover; source FOPH). Her insurer tells her its discount rate; the table works through three possible rates to show the order of magnitude:

What this means for you

A prepayment discount pays off when three things come together:

1. Your insurer grants one. Look at your premium invoice or ask. You can find the contact details in the profile under health insurers.
2. You have the money without a squeeze. The annual premium is due in January, possibly together with bills up to your deductible. Plan a reserve for both.
3. You expect to stay for the whole year. If you leave, you get advance payments back, but the discount may be lost pro rata.

If you want to switch as of 1 January, decide on the insurer first and only then on how to pay. Your notice of cancellation must reach your current insurer by 30 November; all dates are listed under deadlines. With your new insurer, you can choose annual payment right when you register.

Common mistakes

• Giving the discount more weight than the premium. A few francs of discount are no substitute for comparing premiums between insurers.
• Paying the advance invoice late. You may then lose the discount and risk a reminder.
• Comparing official premiums with invoice amounts. The FOPH premiums do not include a prepayment discount; work out your invoice without the discount before you compare.
• Paying in advance without a reserve. If you pay the annual premium in January and receive a large doctor’s bill in February, you can quickly fall into arrears.