Insurance in Germany: all you need to know!

The overabundance of options and exceptions regarding insurance in Germany make it necessary to get an overview as soon as possible. Some insurance providers offer service in English language which makes life easier!
Or even redundant? Tangled up in manifold options, the insurance services offered in Germany are way too complex to be understood in just a few hours. So when being confronted will all sorts of contracts, rules and regulations, just do not despair. Among the many contracts you are about to sign, insurance contracts in Germany are one of them as some are simply mandatory. Constantly promoted literally anywhere, insurances can cover pretty much any area in your life – from health to holiday, car or dog up to home contents. In case you have absolutely no idea which of the many insurances is compulsory or just nice to have, we will provide you with all the information you need when moving to Germany! We cannot do the tedious paperwork for you but at least give you an overview which is helpful when settling here. There are of course exceptions to be considered, depending on your lifestyle, age and income – however, if you earn more than 450 €, you do have to pay contributions to social security. And this is where it all starts!
Beware of mandatory insurance in Germany
We start with the most important insurance in Germany which is not optional at all, but compulsory. Health insurance is one of the most important ones and as you know now, mandatory. As the entire system might be a bit confusing at first, we shed light on the matter of social security contributions in Germany. You are obliged to pay for a bundle of insurances which constists of the following: health insurance, long-term nursing care insurance, unemployment insurance as well as statutory pension insurance.[quote align=“center“]Do not despair. It takes some time before you really get a deeper understanding of insurance issues in Germany. Plan to take some extra time for this particular topic.[/quote]
Health insurance – Krankenversicherung

Some things about insurance in Germany are best arranged in advance. You won’t be able to enrol in a German university when you do not have any health insurance coverage!
Health insurance in Germany is either statutory health insurance (gesetzliche Krankenversicherung or GKV) or private health insurance (private Krankenversicherung or PKV). Unlike other mandatory insurances, you are allowed to choose your own health insurance from the many providers. When it comes to statutory health insurance, you are also demanded to pay an additional contribution of about 1 % for the health insurance fund (rates differ from year to year). 14.6 % of your gross salary is reserved for your statutory health insurance, and employers in Germany pay half of it. When your annual gross income exceeds a sum of 60.750 Euros (for 2019), you can either stay in statutory health care as a voluntary member or opt for a private health insurance fund. Please keep in mind that once you chose private health care in Germany, there is no turning back – even when you earn less in the future. The complexity of the topic has it that we need to provide more details on that so you can get the bigger picture. For more information about health insurance in Germany, click here. For stays abroad you need an extra travel health insurance which is mostly rather inexepensive und certainly less complicated!
Long-term nursing care insurance – Pflegeversicherung
Sometimes referred to as statutory nursing care insurance (Pflegeversicherung), which is linked to your health insurance. This means you do not have to look out for an insurance company other than your health insurance with this one. The contribution for the statutory nursing care insurance in Germany amounts to 3.05 % of an employee’s income, half of which is paid by the employer. In case you are childless and over 23, you are obliged to pay a surcharge of 0.25 % of your gross salary (§ 55 para. 1 of SGB XI).
Unemployment insurance – Arbeitlosenversicherung

Unemployment insurance in Germany mandatory for employees who earn more than 450 € a month.
Arbeitslosenversicherung is one of the mandatory insurances in Germany you will come across. In case you are an employee or trainee (or person subject to compulsory insurance under employment promotion law), you will receive unemployment benefits if you contribute 2.5% of your gross income (2019). For employees who earn more than 450€ a month, the unemployment insurance is part of the compulsory contribution to social insurances in Germany. Half of the rate is paid by your employer. The insurance institution for this is the Federal Employment Agency in Nuremberg. However, every city has its so-called Jobcenters or regional offices in case you experience unemployment. To receive benefits from the Arbeitsagentur, one year of employment respectively contribution is demanded.
„You have probably seen by now that the contributions to social security in Germany are rather high. You get a lot but you are also obliged to pay a considerable sum of expenses for insurance and institutions.“
Statutory Pension Insurance – Rentenversicherung
German Statutory Pension Insurance (Deutsche Rentenversicherung) is also one main pillar of social security and also mandatory. The monthly contribution depends on your gross income like the other insurances do. There is an upper limit of contribution though, defined by the German Government, and the current rate is 18.7% of your gross income – half of which is paid by the employer. For self-employed citizens and those who are voluntary members (exceptions), the entire contribution to the German statutory pension insurance must be paid. Therefore, the burden of contributions for self-employed persons is quite high in Germany. In order to be entitled to a pension in Germany, you are obliged to be a member for at least five years. The more you pay in over the years and the higher your contributions are, the more you get at the end.
Statutory Accident Insurance – Gesetzliche Unfallversicherung
Statutory accident insurance, known here as gesetzliche Unfallversicherung, is paid by the employer, so employees do not have to worry about this one. It is also part of social security in Germany, and any accident at work or on the way to work (university, school) is covered by the gesetzliche Unfallversicherung.
Private liability insurance – Haftpflichtversicherung

Life has its moments and is sometimes unpredictable. A private liability insurance is nice to have.
Haftplichtversicherung is known as private liability insurance or sometimes referred to as third-party private liability insurance. Maybe you are from a country where a Haftpflichtversicherung is mandatory anyway, so you are already aware that this kind of insurance exists. It is very advisable to sign a contract for private Haftpflichtversicherung, because you are liable when you break things in a shop, at a friend’s house or elsewhere. It not only covers object damage, but also person damage. Private liability insurance for motorbikes and cars however is mandatory! For those of you who for instance enjoy sailing, hunting, horse-riding, a separate private liability insurance is a must.
„Private liability insurance is certainly more than nice to have in Germany, and you will come across this kind of insurance more than once – as a car owner, a dog owner and in many other circumstances.“
Life insurance – Lebensversicherung
Life insurance in Germany is a rather complex thing since many options for this kind of insurance exist.Risiko-Lebensversicherung, term life insurance for example is one of them, it exists to provide financial security for spouses and family members after the death of the policyholder. When you already signed a life insurance in your home country, please make sure it is valid when moving to Germany. Otherwise you either pay double or your relatives / beneficiaries will not receive any compensation. Other kinds of life insurances in Germany merely aim at wealth formation. There are several major differences between the contracts available and make sure you understand them in detail before signing any life insurance contract at all. When it comes to life insurance in Germany, you should choose an insurance provider that offers services in English language.
Car insurance – Kfz-Versicherung

Car liability insurance in Germany is mandatory, otherwise you cannot register your car at all.
Car insurance in Germany is mandatory if you own a car. The same applies to motorbikes, mopeds or tractors. The insurance cover and rates for car insurance in Germany vary significantly depending which insurance company is chosen and which kind of contract you think fits your needs best. Depending on your place of residence in Germany, driving experience, age as well as car type, you will pay a different rate. In case you have an insurance from your home country, it is not sufficient. [quote align=“center“]So many options, so much to read first: motor vehicle liability insurance is not enough. You also need further insurance for your car such as Teilkaskoversicherung or Vollkaskoversicherung.[/quote]There is fully comprehensive insurance for newer cars you will find under the term of Vollkaskoversicherung. Another option for older cars is partial coverage insurance known in Germany as Teilkaskoversicherung. It has not the entire service but costs less depending on what you consider important. Whatever you opt for, there is another very important insurance that every car holder just has to have: Kfz-Haftpflichtversicherung, also known as motor vehicle liability insurance. It is mandatory and without it, you will not be able to register your car without it. A Kfz-Haftpflicht is the kind of insurance which covers potential damage on third party property, cars or people. The damage of your own car is not included in it in case you inflicted the accident.
Home contents insurance – Hausratversicherung
Home contents insurance also known as Hausratversicherung in Germany is one of many insurances that are nice to have. It covers goods in your house or flat such as electronic devices, household goods such as vases and it covers in case of theft. But just like with any other optional insurance: look at the details of the contract of your home contents insurance and decide which coverage level is sufficient for you. Bikes can be included as well, but that again depends on your contract of your German home contents insurance. If this is important to you, you should include your bike as well. Note that a home contents insurance does not cover the following things/items: broken glass from windows or doors for example. These need to be insured via a further insurance called Glasversicherung which translates to glass insurance or glass breakage insurance.
Buildings insurance – Gebäudeversicherung
While home contents insurance covers for what is inside, buildings insurance comes into play when insurance cover is needed for the other parts of a house: pipes, frost, tap water, lightning or fire. [quote align=“center“]When you rent a flat, you won’t have to worry about elementary loss or buildings insurance. Flat or house owners however have to make a decision.[/quote]These damages are covered by buildings insurance in Germany. But here comes just another exception for insurance cover: An additional policy, referred to as elementary (loss) insurance or Elementarschädenverschicherung covers any damage to a building caused for example by landslides, flood, earthquakes or avalanches. The latter ones are not included in buidlings insurance. It is for house owners only or in case you bought the apartment you live in. When you rent a flat, your landlord is in charge of those kinds of insurances and you do not need to worry about it.
Occupational disability insurance – Berufsunfähigkeitsversicherung

Not a real bargain: the rates for occupational disability insurance in Germany are quite high.
For some occupations almost unaffordable is occupational disability insurance in Germany, an optional insurance. And yes, you may by now have an idea of how many compulsory insurances there are in Germany. The most important thing to be aware of is the fact that in case of an accident or injury, the statutory pension only covers bits and pieces of your income: you can claim a statutory reduced earnings capacity pension – what a word. It means Erwerbsminderungsrente and is in most cases just a small sum. Depending on the risks you are exposed to at work and in your spare time, the occupational disability insurance may offer a more extensive coverage should you be unable to work in your job because of e.g. an injury. Needless to say, the rates can be high for certain occupations such as when you are in the roofing trade for instance, and high risk hobbies are also taken into consideration when the insurance calculates your contribution for occupational disability insurance.
Legal expense insurance – Rechtsschutzversicherung
Policies cover several professional or personal risks connected to legal dispute. A legal expense insurance will cover several procedural fees for you, but let’s say several, as there are many exceptions such as disputes regarding housing. The insurances companies that offer legal expense insurance in Germany provide different kinds of services and service quality varies. Some offer free advice from an attorney for e.g. an hour, but the quality of the counselling ranges from very good to insufficient.
Be aware of contract renewal in Germany!

Contract renewal can be a real bother. So before you sign a contract, make sure you are well informed about its particular period of notice!
Please note that contract renewal is something to be aware of! The terms you need to know are Kündigungsfrist for period of notice and Vertragslaufzeit for contract period. It is essential to terminate insurances on time if you intend to leave Germany, otherwise you will pay double or for contracts you do not need anymore. Moreover, some insurance rates are either due on a monthly, a quarterly or a yearly basis, depending on the contract. With some insurances, you have no other option than monthly instalments such as health insurance, but other types of insurances in Germany may need to be paid for once a year with a so-called einmaliger Jahresbeitrag.

Till Tauber ist seit 2013 als freiberuflicher Bewerbungsschreiber tätig und greift hierzu auf sein Wissen als Diplom-Ingenieur mit zusätzlichem MBA-Abschluss zurück. In dieser Zeit hat er mehr als 3.500 Bewerbungen im Kundenauftrag geschrieben – und weiß, worauf es beim Anschreiben sowie beim Lebenslauf ankommt. Auf TT Bewerbungsservice schreibt er zu aktuellen Themen rund um die Bewerbung.