National Insurance (NI) in the United Kingdom was initially a contributory system of insurance against illness and unemployment, and later also provided retirement pensions and other benefits. It was first introduced by the National Insurance Act 1911, and expanded by the government of Clement Attlee in 1946.
The contributions component of the system consists of mandatory contributions, National Insurance Contributions (NICs), paid by employees and employers on earnings, and by employers on certain benefits-in-kind provided to employees. The self-employed contribute based upon net earnings. Individuals may also make voluntary contributions, in order to to fill a gap in their contributions record.
The benefit component comprises a number of contributory benefits of availability and amount determined by the claimant's contribution record. Weekly income benefits and some lump-sum benefits to participants upon death, retirement, unemployment, maternity and disability are provided.