What you should know about insurances in Germany

A guide for expats

Insurance systems vary across countries. In Germany, some insurances are mandatory by law. Not getting these insurances sorted early, can lead to expensive situations. This blog will explain everything you need to know about German insurances.

Necessary insurances

Health insurance

Health insurance, called Krankenversicherung, is mandatory for everyone living in the country. There are 2 types of insurance funds: public and private. Both work differently, and choosing the best option requires understanding how they work:

Public health insurance (gesetzliche Krankenversicherung or GKV):
There are many public health insurers (Krankenkassen). These are non-profit funds, but they are not run by the government.

• Cost — Based on your salary (14.6% of income, capped at €769 / month). If you’re employed, the amount is automatically deducted from your salary every month and the employer pays half of this amount. If you’re unemployed, you can use your spouse or parents’ insurance.
• Coverage — All necessary healthcare is covered (including maternity, income protection during sickness). This includes the cost of visitations, treatments and prescriptions. If a treatment is not covered (eg. tooth cleaning) then the doctor will let you know in advance.
• Advantages:
  — It covers your dependents.
  — Since it’s based on your income, it’s cheaper if you have a low salary.
  — Easier to use. You just show your insurance card at the doctor and you’re done. The doctors do the work of claiming the insurance for the bill.
• Disadvantages:
  — You don’t get good treatment. Doctors make more money with privately insured patients, so they give them quick appointments. With publicly insured patients, several doctors just want to get rid of them as soon as possible (but you won’t have the risk of getting unnecessary treatments).
  - Expensive for young professionals. You’ll have to pay a lot if you’re young, have a high paying job and don’t have dependents.

Private health insurance (privat Krankenversicherung or PKV):

You can only have private insurance if you’re self-employed or earn more than € 58,000 / month.

• Cost —Depends on your age and health. If you’re young and have no medical conditions, it can cost around € 200 / month. This cost goes up dramatically with age, health conditions and dependents.
• Coverage — You can choose among options, adding on dental and special treatments for a fee. Nursing care is not included.
• Advantages:
  — Better treatment. You get quick appointments at a wider range of specialists like dermatologists.
  — Significantly cheaper if you’re young and have a high paying job.
  — Services in English for internationals.
• Disadvantages:
  — You have to claim the insurance on your own. The doctors give you the bill and you do the paperwork of filing a claim with the insurance company.
  — Costs more with age and health problems (can go up to € 1500 / month). Some private health insurances can reject your application if you have an existing condition.
  — Risk of getting unnecessary, expensive treatments. Since the doctors don’t need to explain the cost of treatments to the insurance company, they can add on general check-up for €100 and other such items to the bill.
  — Kids and dependents are not covered. You need to pay extra for it.

You might be wondering by now, can’t I take private insurance when I’m younger and switch to a public one when I’m old? 🤔 This is a one way street, you can’t switch to public insurance once you are privately insured.

So which health insurance to choose? Consider private health insurance if you’re young, earn a lot and rarely visit the doctor.

Work related insurance

These are social security contributions (Sozialversicherungsbeiträge). It’s deducted automatically from your salary and you don’t need to do anything about it. Quick summary of what they are:

• Unemployment insurance (arbeitslosenversicherung) — if you lose your job at some point, you get half of your salary (up to a limit) from the state.
• Statutory pension insurance (rentenversicherung) — State pension.
• Accident insurance (unfallversicherung) — covers treatments costs after work-related accidents. Fully paid for by the employer.

Vehicle insurance

If you have a vehicle, it’s compulsory to have automobile insurance (Kfz versicherung or autoversicherung) in Germany. The insurance is required to register a car in Germany. There are 3 types of car insurances:

• Third-party liability (haftpflicht) — the minimum legal requirement, covering all damage to third parties and other vehicles in the event of an accident. It doesn’t cover damage to your own vehicle if the accident was your fault.
• Partial coverage (teilkasko) — this covers third party liability plus damages to your vehicle caused by things such as theft attempts, fire damage and storm damage.
• Comprehensive coverage (vollkasko) — this covers everything above plus damage to your own vehicle, even in cases where the accident was your fault.

Optional insurances

• Liability insurance (Haftplichtversicherung): Covers damages to other persons or their property. It’s quite cheap (<100 EUR / year) and will save you a lot of trouble.
• Household items insurance (hausratversicherung): Some rental contracts require you to get one. This insurance only makes sense if you have valuable items in the house.

There are several other types of insurances but these are the ones you need to sort out when you’re moving newly to the country.

If you have further questions related to your relocation, Movy can advise and help you on the process. Get in touch with us!