Confused by Germany’s two-tier health insurance system? You’re not alone. Private health insurance (PKV – Private Krankenversicherung) offers top-tier services and flexible coverage options, but it isn’t suitable for everyone. For expats navigating the complexities of the German healthcare system, understanding the ins and outs of PKV is crucial. This guide provides an in-depth look at what private health insurance entails, who qualifies, the pros and cons, and how to make the best decision for your needs.
Understanding Private Health Insurance in Germany
What is PKV?
PKV refers to health insurance provided by private companies in Germany. Unlike statutory health insurance (GKV), which is income-based and universal, PKV policies are tailored contracts with individualized benefits. These often include:
- Faster access to specialists and treatment
- Coverage for private hospital rooms
- Comprehensive dental and vision plans
PKV vs GKV Comparison
| Feature | Private Insurance (PKV) | Public Insurance (GKV) |
|---|---|---|
| Basis of Premiums | Age, health, and coverage | Income-based (14.6% + surcharge) |
| Family Coverage | Individual per person | Free for non-working dependents |
| Choice of Doctors | Almost unlimited | More restricted |
| Wait Times for Appointments | Usually shorter | Can be longer |
| International Coverage | Often included | Limited (mostly EU) |
| Switching Flexibility | Hard to return after 55 | Easier to switch to PKV |
Who is Eligible for PKV?
Private health insurance is not available to everyone. Eligibility includes:
| Category | Eligible for PKV? | Notes |
| Employees > €73,800 | ✅ | Must remain above threshold yearly |
| Freelancers/Self-employed | ✅ | No income threshold, but must show stable income |
| Civil Servants (Beamte) | ✅ | Receive subsidies from the state |
| Students | ✅/❌ | Can choose PKV before turning 30 or after 14 semesters |
| Employees < €73,800 | ❌ | Must stay in GKV |
Once enrolled, switching back to GKV becomes difficult, especially after age 55.
Historical and Systemic Background
Origins of the Dual System
Germany’s dual health insurance model has existed since the 19th century, rooted in a mix of solidarity and privatization principles. PKV was introduced to offer more choice and better service to those who could afford it.
PKV’s Role in the Healthcare Ecosystem
Private insurers play a critical role in supplementing the healthcare system:
- Financing innovation and advanced treatments
- Reducing the burden on the public system
- Serving high-income and high-risk individuals with tailored plans
Advantages of Private Health Insurance
Enhanced Services
Private health insurance often grants:
- Immediate specialist appointments
- Elective procedures with top surgeons
- Private or semi-private hospital accommodation
Cost Efficiency for Certain Groups
Younger, healthier individuals might pay less with PKV than with GKV. Choosing:
- High deductibles
- Selective coverage can significantly lower premiums.
Disadvantages and Long-Term Considerations
Increasing Premiums with Age
As you age:
- Premiums typically rise
- Aging reserves (Alterungsrückstellungen) help but don’t fully offset increases
- Planning for retirement is essential
Complexity and Admin Burden
Policyholders must:
- Pay upfront for treatments
- Submit claims for reimbursement
- Navigate complex tariff structures
Choosing the Right Insurer
Key Evaluation Criteria
When selecting a private insurer, compare:
- Financial strength and company reputation
- Coverage options and exclusions
- Claims process and customer service
Typical PKV Tariff Breakdown
| Coverage Area | Included in Basic Tariff | Common Add-ons |
| Outpatient Treatment | ✅ | Specialist access, faster appt. times |
| Inpatient Treatment | ✅ | Private room, senior doctors |
| Dental Care | ❌ | 80–100% reimbursement |
| Vision (Glasses/Contacts) | ❌ | Up to €300/year |
| Alternative Medicine | ❌ | Homeopathy, acupuncture |
The Role of Independent Advisors
Engage with licensed brokers who:
- Are not tied to a single provider
- Help match policies to your personal situation
- Explain contract fine print and future flexibility
Real-Life Examples
Freelancer Success Story
A 29-year-old web developer in Berlin saved over €1,000 annually by choosing PKV with a high deductible and opted for coverage tailored to outpatient care.
Expat Family Planning
An American family with two children chose PKV for faster access to pediatric care and broader maternity coverage. They balanced higher premiums with tax benefits.
PKV Cost Comparison Example
| Profile | GKV Monthly | PKV Monthly | Notes |
| 30-year-old freelancer | €850 | €450 | With €1,000 deductible, basic outpatient |
| 40-year-old employee (>€73,800) | €960 | €620 | Includes dental + inpatient private coverage |
| 35-year-old with 2 kids | €960 (all covered) | €950 (each person insured) | Children must be insured separately in PKV |
Overlooked Aspects of PKV
Switching Back to GKV
Legally restricted, especially for those over 55. Exceptions are rare and often involve:
- Significant life changes (e.g. unemployment)
- Return to a salaried job under the income threshold
Global Coverage
Many PKV policies offer:
- Emergency treatment abroad
- Extended international coverage beyond EU norms
Addressing Common Concerns
Rising Costs
Solutions include:
- Selecting tariffs with capped increases
- Exploring tariff downgrades or switching within the same provider
Pre-existing Conditions
These can lead to:
- Premium surcharges
- Exclusions from certain benefits
- Consideration of the Basic Tariff (Basistarif) with guaranteed acceptance
Administrative Hassle
Digital insurers and brokers now offer:
- Online portals and mobile apps
- Automated claims submission
- Customer support in English
Alternative Approaches
Public Insurance + Supplements
Those who stay in GKV can add:
- Dental insurance
- Private hospital upgrades
- Travel insurance
International Health Insurance
Ideal for:
- Short-term expats
- Digital nomads Ensure policies meet German residency requirements.
Crucial but Little-Known Facts
Tax Deductibility
Freelancers and the self-employed can deduct PKV contributions as business expenses, potentially reducing the net cost significantly.
Gender-Neutral Pricing
Since 2012, all new tariffs are unisex, making premiums fairer but slightly higher for men than in the past.
Challenging Misconceptions
“PKV is Always More Expensive”
Not true for:
- Young professionals
- High earners without dependents
“Everything is Covered”
Some services may be excluded or require co-payments. Always check:
- Coverage limits
- Waiting periods
Under-Discussed Aspects
Mental Health
Coverage varies widely by provider. Ensure:
- Therapy sessions are included
- Pre-approvals are understood
Maternity and Family Care
Check policies for:
- Prenatal and childbirth coverage
- Midwife access
- Fertility treatments
Common Mistakes to Avoid
Choosing Based on Price Alone
This can lead to:
- Inadequate coverage
- Surprising exclusions later
Ignoring Fine Print
Important to review:
- Deductibles
- Tariff change rights
- Lifetime coverage commitments
Conclusion
Summary
Private health insurance in Germany offers premium services and customized care. But it’s a long-term decision with financial and administrative implications.
Actionable Takeaways
- Use a certified, independent advisor
- Compare tariffs thoroughly
- Consider future life changes (family, retirement, health)
