Insurance · 2 min read

The Right Time for Private Health Insurance as an Employee

This guide refers to German law and the German tax system. It is a translation of our German original and does not replace individual tax or legal advice.

Private health insurance (PKV) is particularly well known among the self-employed and freelancers. Yet many myths and prejudices surround PKV, which, thanks to its high level of benefits, is just as worthwhile for employees. In this article, we explain from when employees can switch to private health insurance and what to bear in mind when switching.

Neo Capital is your point of contact for insurance and pension products for high-earning employees. We support civil servants, the self-employed, freelancers and high-earning employees on the way to optimal provision and advise you without obligation on your individual situation.

How to switch successfully to private health insurance

Anyone who uses the benefits of statutory health insurance (GKV) via their employer forgoes numerous advantages of private insurers: unrestricted choice of doctor, faster appointments and more specialised treatment methods and medication. In addition to better benefits, a second advantage lies in saved contributions – anyone who switches to PKV with a gross income of more than €69,300 has usually been paying the statutory maximum rate. The difference saved compared with the PKV premium can be invested tax-efficiently and profitably; over the period up to retirement age, the compound interest effect creates private wealth that should not be underestimated. For many employees, switching to PKV is therefore often even cheaper or equally expensive in the long term – with a significantly higher level of benefits.

Entry threshold €69,300 gross (as of 2024)

While the self-employed and freelancers can switch without any financial requirements, employees in Germany need a gross income of more than €69,300 to join PKV (as of 2024, excluding commission and bonuses). Those with a lower income who still want to qualify for admission can use an Anwartschaft (option to switch later) to freeze their current state of health until the time of admission – a later switch on the basis of the historically healthy condition thus remains possible, even if illnesses or stricter health questions arise in the meantime. As around 15% of all those wishing to switch can no longer do so due to pre-existing health conditions, securing your health status in this way is an important instrument. Switching late after reaching the income threshold, on the other hand, brings only disadvantages – up to and including losing the chance to join if new illnesses occur.

Neo Capital: your health optimally insured

To cover all individual risks when selecting a tariff, we support you as independent advisers with years of expertise and point out attractive tax and investment opportunities for the contributions you save. For the self-employed, freelancers and high-earning employees, we filter from around 20,000 possible tariff combinations and also take into account the financial strength of the insurer. To select the best tariff and the free funds for investment, we use modern analysis software to advance your private wealth building through switching to PKV.