Private cover and the self-employed

Private insurance can initially seem an attractive alternative to statutory health insurance. Unlike with statutory insurance, the contributions to private health cover are not dependent on income. With statutory cover the

contributions remain calculable.

Good to know: with private health care, the word premiums is used instead of contributions. Insurees with private cover sign individual contracts with insurance companies. The cost of the premiums depends on things like their age, health , the benefits they want and any deductibles. This means the premiums are based on risk and can vary a lot depending on each person's situation and the plan they choose.

Statutory health insurance	Private health insurance
The contribution rate is income-based and is paid in full. Income is reviewed regularly using the tax assessment. If you are self-employed you can choose between the general and the reduced contribution rate. The reduced rate does not entitle you to sick pay.Statutory health insurance provides security mechanisms to protect you from undue hardship. If your earned income decreases drastically and unexpectedly, your contribution rate can be reduced at short notice.On retirement, contributions are calculated based on your pension income and not on salary.	Private insurance premiums are based on age and health.Private insurance premiums are not based on income. Therefore, unemployment, illness, or other circumstances affecting your earnings will not automatically reduce what you pay. You will continue to pay the same amount regardless of these changes. This can result in serious financial problems in economically difficult times.After the age of 55, it is virtually impossible to return to the statutory system. Private insurees must therefore continue to pay their full contributions. It is also worth remembering that with age we are likely to require more medical care. As such, older insurees tend to opt for more comprehensive and more expensive plans.

Statutory health insurance

Private health insurance

The contribution rate is income-based and is paid in full. Income is reviewed regularly using the tax assessment.

If you are self-employed you can choose between the general and the reduced contribution rate. The reduced rate does not entitle you to sick pay.

Statutory health insurance provides security mechanisms to protect you from undue hardship. If your earned income decreases drastically and unexpectedly, your contribution rate can be reduced at short notice.

On retirement, contributions are calculated based on your pension income and not on salary.

Private insurance premiums are based on age and health.

Private insurance premiums are not based on income. Therefore, unemployment, illness, or other circumstances affecting your earnings will not automatically reduce what you pay. You will continue to pay the same amount regardless of these changes. This can result in serious financial problems in economically difficult times.

After the age of 55, it is virtually impossible to return to the statutory system. Private insurees must therefore continue to pay their full contributions. It is also worth remembering that with age we are likely to require more medical care. As such, older insurees tend to opt for more comprehensive and more expensive plans.