At today's date almost 8 million people in Germany either decided or were forced to seek cover with a German Private Health Insurance plan, the official term: "Private Krankenversicherung (PKV)". With just 45 in 2019, the list of providers is managable, however the vast and nontransparent range of different plans, benefits and additional services like online doctors or Cash-Back schemes is comparable to taking a walk though the jungle - without the right tools you will get lost or guided into a pitfall that will come costly!
What does a German health plan include
“Medical” together with “Mandatory Long-Term Care” make up the main construct of German private health insurance, in German is referred to as: “Krankheitskostenvollversicherung”. There is no one-to-one translation for latter terminology, thus just needs to be understood as comprehensive health insurance.
In addition to the above, the policy can be extended with the following optional benefits, which are considered as separate contracts, hence can be added or removed without affecting the main insurance construct.
The insurer pays a fixed amount for every day the insured person is required to go on cure (e.g. asthma patients)
- Hospital "per diem" Allowance
The insurer pays a pre-arranged amount for every night the insured person is admitted to hospital
- Precautionary medical examinations
The insurer pays a fix agreed amount for medical check-ups that correlate with the German statutory ("public") health system
- Premium Stability Scheme
A tariff that can be added allowing the insured-person to save up necessary funds - a puffer - that will help to assure affordable premiums at old-age. Not only are these additional payments tax-deductible but are also not subject to German Settlement Tax (Abgeltungssteuer).
The 2 most common credit forms - constant and dynamic
The insured-person determines a fixed amount by which the premium increases month for month
The insured-person determines the intervals in which the premium should be increased
- Sickness "per diem" Allowance
The insured person can set up a payment scheme in which the insurer will pay a pre-arranged amount for each day of sickness.
Different insurers have different plans but generally the insured person can define an amount to be paid as from the second week and/ or any of the other weeks that follow.
In the following example the insurer would pay 200€ per day should the insured person still be written-off sick after 6 months.
- As of week 6 => 50€ per day
- As of week 13 => 50€ per day
- As of week 26 => 100€ per day
- Worldwide medical insurance
Not all providers offer worldwide coverage as a standard, therefore it is advisable to include such a benefit as the costs are very little.
Tip: Even if a policy includes worldwide cover, adding this tariff is a way to bypass the annual excess.
One other benefit, which the German calls "Optionstarif", allows a switch on renewal to a more comprehensive plan without having to undergo a new medical examination. This is highly recommendable to a person who has been accepted with a more serious pre-existing condition and needs the possibility to switch to better coverage, should future medical enhancements make curing treatment possible.