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To better protect the welfare of large numbers of workers in rural areas, a new social insurance system targeting employees in small-sized towns will begin this month.

Passed by the municipal People's Congress on Friday, the insurance system will go into effect on October 29.

Known as 24-X, the new system, which will later replace farm insurance to become the basic social insurance system in suburban areas, has two distinctive characteristics: low entrance requirements and a high-degree of flexibility.

Authorities have lowered the compulsory rate for working units to 24 per cent compared to 45.7 per cent demanded by the urban insurance system.

That is to say for the work units which join the small-sized insurance system, compulsory amounts needed are 24 per cent of the last years' average income of local employees. In the urban insurance system, the multiplier is 45.7 per cent.

But that doesn't mean the suburban insurance is a lesser form of insurance, since there is the supplementary part, or the X.

The amount of the X is flexible for work units and individuals. Individuals can adjust the contributions made according to their own situations, so it is possible their treatment under the suburban insurance would reach or even surpass the urban insurance provided.

The small town insurance now includes an endowment, along with insurance for health, unemployment and maternity insurance. And more options may be added in the future.

"The low entrance factor and high flexibility makes it possible for a wider coverage for this insurance system in the suburban areas," said Zhu Junyi, director of Shanghai Labour and Social Security Bureau, in a speech delivered to the congress.

"It can best meet the different demands of various districts, enterprises and individuals."

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