Schenkkring and Broodfonds
A schenkkring and a Broodfonds are both AOV alternatives that are based on mutual trust. Both AOV alternatives contain of a group of self-employed people who create a safety net (insurance), in case one of them becomes unable to work. With both AOV alternatives, you will receive a benefit for a maximum of two years. Even though the schenkkring and broodfonds share many characteristics, they do not overlap in every aspect.
A schenkkring is a small group of self-employed people of which you can become a member and where each member contributes a set amount of money for the shared safety net. The contribution you make to the schenkkring will be put into everyone’s personal savings. If your contribution to the schenkkring was higher than the amount paid out, the remaining money will simply stay in your personal saving.
If the situation occurs that you become unable to work, you will receive a monthly amount consisting of donations from the other members in the schenkkring and from your own personal savings. To join a schenkkring you must meet certain requirements, including a minimum profit of €750 per month. You also need to be working as an entrepreneur for at least a year.
A broodfonds generally consists of a larger group than those within a schenkkring. With the broodfonds, you also create a shared safety net, just like a schenkkring. However, a broodfonds does not work with personal savings. Instead, you make a donation at least once a month, which will then be directly transferred to the incapacitated person. If there are no incapacitated people, then your donation will be placed in the savings buffer.
A broodfonds generally has several groups of which each consists of self-employed people within the same sector, for example a group specifically designed for self-employed people working in agriculture. Although each member transfers a donation each month, the amount you donate is not set and will decide the amount you would receive if you were to become unable to work.
However, the autonomy you have regarding your benefit does have a limit and a maximum. The extent of your benefit will be determined by the broodfonds and the entrepreneurs together.
A maximum amount of benefits that will be paid out is something you will not see within a traditional AOV. When taking out a traditional AOV as a self-employed person, you will have more control over the amount of benefit you will receive if incapacitated.