Private Health Insurance (PKV)

In Germany, there are 39 private health insurance providers, out of which 33 provide comprehensive private health insurance. 8.7 million have private health insurance in Germany, which is roughly 10% of the country’s population. On the other hand, the statutory health insurance system has ~75 million members. Any one who is living in Germany needs to have health insurance as well as long-term care insurance. You sign up for both health and long-term care insurance with the same provider. The statutory health insurance is a solidarity system, where your health insurance contributions depend on your income. The private health insurance, on the other hand, works on the equivalency principle in which the contributions depend on age and the type of cover you choose. Not every one can opt for private health insurance since it has certain eligibility criteria. There are five groups who are eligible for private health insurance:

1. Students
2. Civil servants
3. Employees earning above the annual wage limit (JAEG)
4. Self-employed people
5. Children whose parents are privately insured or the higher-earning parent is privately insured

For civil servants, private health insurance is, in many cases, the better option because of the contribution support that they receive from their employer. For other groups, the decision of statutory vs private health insurance depends on one’s personal circumstances. Private health insurance does offer some benefits over statutory health insurance. Privately insured patients have less waiting time for an appointment with a doctor compared to statutorily insured patients. This was confirmed in a study conducted by Leibniz Institute for Economic Research. The shorter waiting times for privately insured patients might be driven by doctors being able to charge higher amounts for privately insured patients compared to what they can charge for statutorily insured patients for the same treatment. For privately insured patients, they use GoÄ fee schedule for doctors and GoZ for dentists. For statutorily insured patients, they use the EBM schedule.

Also, private health insurance can provide access to top-of-the-line medical care. Depending on your choice of tariff, you can see the chief physician, get treatment at a clinic abroad or choose services that are most important to you. What statutory health insurance offers, is covered by law. Services offered by different statutory health insurance funds are mostly the same, except for differences in certain additional services such as travel vaccinations and preventative health checks.

While private health insurance offers a large number of tariffs with different service levels and allows you to choose a tariff based on your needs, it doesn’t necessarily mean that it is the best option for every one. Here are a few factors that you need to consider before making a switch to private health insurance.

1. Private health insurance premiums are lower when you are young & healthy and increase when you are older & sick. This means that premiums increase as you get older irrespective of your income level. While you pay retirement provisions from the the ages of 21 to 60 to account for higher health costs when you are old, the reality is that healthcare costs are increasing. While the retirement provisions will offset some of your higher medical costs and you will no longer pay the retirement provisions after the age of 60, you still might need to pay higher medical premiums as you get older. You can use the calculator on our website to compare the lifelong PKV costs with the lifelong GKV costs.

2. If you are privately insured and have children, you need to have separate private health insurance for your children. With the statutory health insurance, children are covered for free. Even with private health insurance being cheaper during your younger years, the costs can add up especially if you have two or more children. The employer can subsidise some of the premiums that you need to pay for your child, if there is still room in your subsidy cap. An example case would be that you need to pay 600 euros per month for your private health insurance. Your employer will cover 300 euros of it. You still have 313.22 euros in your subsidy cap (value for 2026) which can be used to cover 50% of the premium for your child’s insurance. Either parent but not both can claim this subsidy from their employer. This can be decided based on which parent has more room in their subsidy cap.

3. Since you are paying retirement provisions from the age of 21 to 60, it also means that once you get private health insurance, you are kind of stuck with a company for the rest of your life. If you switch providers at a later point in time, you can only take part of the retirement provisions with you and might have to pay higher premiums with your new provider to build up retirement provisions there.

4. Once you opt for private health insurance, it is quite difficult to switch back to statutory health insurance. This is generally only possible if you drop below the JAEG wage limit or become unemployed.

If you have decided to go for private health insurance, it is important to choose the right tariff for your needs. You can work with a licensed insurance intermediary who can understand your situation and needs and recommend a tariff accordingly. There are also some independent ratings companies in Germany who rate the available tariffs from different health insurance companies. Once you have shortlisted a few tariffs, you can check the ratings of those tariffs for free on Morgen & Morgen and Franke & Bornberg to help you finalise your tariff option.