Ministry of Labour, Social, Family Affairs and Integration
Bank Account, Insurance & Taxes Social Insurance
German social insurance is a statutory insurance system. It provides financial protection against major life risks and their consequences, such as illness, unemployment, age and long-term care.
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Usually, all employees are subject to compulsory statutory social insurance and therefore protected against the greatest risks.
There are five pillars of social insurance:
- Health Insurance
The health insurance covers the necessary costs in case of illness as well as many costs of health care and rehabilitation measures. Normally, as an employee you are obliged to be insured in statutory health insurance. If you are self-employed, or if your annual income is higher than the compulsory insurance threshold (as of 2017: € 57,600), you can decide whether you wish to insure yourself by public health insurance or private health insurance.
- Long-Term Care Insurance
You will receive the support of the long-term care insurance, if you are unable to take care of yourself due to illness or old age.
- Pension Insurance
The pension insurance pays you a monthly pension when you retire.
- Unemployment Insurance
When you become unemployed, the unemployment insurance system provides financial support for a certain period of time. The prerequisite is that you have been insured in the past two years for at least one year, and that you continue to look for work.
- Accident Insurance
The accident insurance covers all costs in the event of an accident or occupational disease.
Who is insured?
- In principle, all employees are subject to compulsory statutory social insurance.
- For self-employed persons, the insurance obligation does not apply to pension insurance, unemployment insurance and accident insurance. Self-employed persons have to insure themselves in a public or private health and long-term care insurance.
However, not exempt from the obligation of insurance are the following groups: Craftsmen, homeworkers, teachers, midwives, educators and care workers, artists and journalists, self-employed persons with a client, sea pilots, coastal skippers and coastal fishermen. They are subject to compulsory statutory social insurance.
- The social security system is financed by contributions from employers and employees, usually at the same rate. Only the contributions to accident insurance are fully paid by the employer.
- The employee’s contributions are deducted from the gross salary. The employer’s contributions to the social insurance are paid directly by the employer.
The documents available for download below offer more detailed information on the various insurance branches.