Private Health Insurance in Old Age

Before taking the step into private health insurance, several important questions must be considered. One of the biggest questions that comes to mind for many is: How does private health insurance work in old age? In the following, I will inform you about what disadvantages of private health insurance can be in old age and how you can avoid them, so that you can enjoy all the benefits of private insurance in the long term without having to worry about the future.

Private Health Insurance in Old Age – Expensive?

The myth that private health insurance must always be expensive in old age is still circulating, but where does this actually come from?

Employees, in particular, can face problems when entering retirement because the employer’s contribution to health insurance is no longer available. This doubles the contribution at once, which can lead to a significant financial burden for many. Moreover, the current pension level is only 48% of the average annual income and is expected to fall to about 44.5% by 2030, which of course exacerbates the whole problem. Finally, it is often the case that a tariff with a low deductible was chosen, for which there may not be an alternative with the same benefits but a higher deductible.

But if you think this is a deal-breaker, you’re mistaken!

The solution: The contribution relief tariff. Since 2000, privately insured individuals have had the option of taking out a contribution relief tariff that builds up additional reserves. The best thing about it is that the employer pays half of it (up to the legally regulated maximum employer subsidy) because it is a regular component of your health insurance.

Example:

Your tariff costs 600€ + 90€ nursing care insurance, 80€ daily sickness allowance, and you relieve 500€ in old age for an additional contribution of 150€ per month. Your monthly contribution in this example is 920€, of which half is paid by your employer, so you pay 460€ yourself while you are working.

When you enter retirement, your daily sickness allowance is eliminated and you relieve 500€, so we can already subtract 580€ from your contribution of 920€, leaving your monthly contribution in retirement at only 340€. In addition, you also receive a subsidy of 8.55% of your pension, which offsets part of your contribution. Even if the insurance company increases its contributions by 20% of the health insurance tariff in the meantime, the contribution in retirement would be just 460€, minus the pension subsidy of 8.55%.

The disadvantage of the contribution relief tariff, however, is that the relief cannot be transferred from one company to another. For those who find this too inflexible, or who are self-employed and don’t get half from their employer, the rate of 150€ can also be invested in the form of a basic pension or Rürup pension or another private pension model.

Lack of Flexibility?

It’s no secret that in private health insurance, you should ideally choose your tariff and stay with it. This is because switching to a new tariff can have some disadvantages and later, when you suffer from certain illnesses, may not even be possible anymore. That’s why it’s all the more important to choose a company, but above all a tariff, that you can be happy with in the long term.

Trying to save at all costs in young years is actually not an advantageous approach. When making a choice, you should primarily think about what kind of care you want when you are seriously ill, old, or both. Thus, the lack of flexibility is no longer a problem at all, because you already have a product that suits you well in all life situations. If you are healthy, you can even benefit from a premium refund and additionally deduct your contributions from your taxes.

Apart from that, one must not forget that the statutory health insurance (GKV) is even more inflexible. There are legally prescribed benefits from which the insurance providers cannot deviate. Only a few additional programs and the service distinguish them from one another, which are often just a drop in the ocean. Furthermore, one must not forget that the GKV can adjust its benefits at any time, so that more and more treatments and aids have to be paid for privately. However, those who have private health insurance always get exactly the benefits they signed up for when they joined. The providers cannot subsequently cut subsidies for glasses or similar items, for example.

Additionally, an option tariff can be booked, which offers the possibility to switch to a higher-value insurance coverage later on. However, it is much more advisable to choose the right tariff from the beginning.

Children in Private Health Insurance – a Financial Risk?

If you earn above the annual income threshold, are married, and your partner must remain in the statutory health insurance, then you are obligated to privately insure your children with you. Therefore, the entitlement to free family insurance is no longer applicable.

If your children cannot join the private health insurance for health reasons, there is still the possibility to insure them in the statutory health insurance for a fee. However, if the possibilities for private health insurance for your children are given, this often has great advantages. The contributions are usually between 150 and 250€ (as of 04/2025), with real premium tariffs available at the upper price range.

If you have an employer, they are obligated by § 257 SGB V to subsidize your children’s insurance up to a certain amount. Additionally, you don’t have to struggle to find a pediatrician appointment, because doctors benefit more from private patients due to the medical fee schedule. Of course, the same benefits apply to your children as they do to you, but these are dependent on the tariff. For this, I would advise you to seek comprehensive consultation.

When your children later start an apprenticeship, they typically return to statutory insurance, and students are even allowed to choose whether they want to be privately or statutorily insured at the beginning of their studies. For this, there are so-called student tariffs, which are often cheaper than the statutory health insurance.

You Can Never Go Back to Statutory Health Insurance

This too is a widespread myth. Until the age of 55, there are various possibilities to return to the statutory health insurance if desired. For this, one simply needs to fall below the annual income threshold in one year or be employed below the annual income threshold – and there are almost always possibilities for arrangements.

However, this is usually not desired at all because the advantages of private health insurance far outweigh the disadvantages.

Conclusion on Private Health Insurance in Old Age

As you can see, it is essential to be well-informed when faced with the decision of whether to switch to private health insurance in old age. By knowing what to expect, you can remove all possible pitfalls and ensure long-term satisfaction with your private health insurance.

If you have any further questions about private health insurance in old age or about private health insurance in general, please contact us. We are very happy to assist you in choosing between statutory and private health insurance, as well as in selecting your private health insurance provider. To learn more about private health insurance, please visit our Blog.
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