Private health insurance does not pay daily sickness allowance: strategies for policyholders to enforce their claims
04.06.25
6
Minutes
Katrin Straub
Managing Director at nextsure
Your private health insurance does not pay sickness benefit, and you are facing financial challenges? This is a stressful situation that many policyholders experience. This article shows you ways to defend yourself and enforce your claims.
The topic in brief and concise terms
If the private health insurer does not pay the daily sickness allowance, policyholders should carefully review the rejection notice and lodge an objection within the deadline.
Common reasons for rejection are doubts about 100% incapacity for work, the assumption of occupational incapacity, or a breach of the duty of disclosure.
Involving a specialist lawyer or the insurance ombudsman can significantly increase the chances of retaining benefits.
Immediate action in the event of refusal of sickness daily allowance
If your private health insurance (PKV) refuses to pay sickness daily allowance, this is initially a shock for many policyholders, as monthly premiums may often have been paid for years. It is crucial to review the insurer's rejection notice carefully, because many reasons can be challenged in legal terms. Gather all relevant documents immediately, such as medical reports, sick notes and all correspondence with the insurer, so that you have at least some evidence. A prompt response and lodging a well-founded objection are often the first important steps to secure your entitlement. Sickness daily allowance insurance is an important component of your cover.
Understanding common reasons why private health insurers do not pay sickness daily allowance
Private health insurers scrutinise claims for sickness benefit very carefully, as they can involve considerable costs. A common reason for rejection is the assertion that there is no 100% inability to work, which is a requirement under many policies. Self-employed people in particular, who may even carry out minor tasks such as replying to emails, can be affected by this. Another point of dispute is the distinction between inability to work and incapacity for work; insurers sometimes argue that permanent incapacity for work already exists, meaning the obligation to pay sickness benefit lapses. Many policyholders underestimate the strict requirements for proving complete inability to work.
Here is an overview of typical reasons for rejection:
Breaches of pre-contractual disclosure obligations (e.g. undeclared pre-existing conditions).
Doubts about 100% inability to work.
Assumption of incapacity for work instead of temporary inability to work.
Formal errors (e.g. certificates submitted late).
Alleged loss of entitlement, for example through carrying out work while on sick leave.
Overinsurance, if the sickness benefit exceeds net income.
Knowing these reasons helps you better assess your insurer’s reasoning and respond accordingly. For self-employed people, sickness benefit for the self-employed is often vital.
Your rights as an insured person: Actively claim your entitlement to sickness daily allowance
As an insured person, even if a claim is declined, you still have various options for asserting your rights. First, you should lodge a formal objection to the private health insurer’s decision, ideally with a detailed justification and all relevant documents attached. Most insurers set deadlines of three to six months for this. A written explanation of the refusal by the private health insurer is essential; verbal statements are often not sufficient. If the objection is unsuccessful, the insurance ombudsman can be involved, an independent arbitration body that mediates in disputes worth up to ten thousand euros. It is important to understand, the difference between sickness benefit and daily sickness allowance.
Practical examples: When private health insurance stops paying sickness benefit
A typical scenario is that a self-employed graphic designer is signed off sick due to burnout and, after a few weeks, the private health insurer stops paying daily sickness benefit. The justification: he replied to a business email, which allegedly rules out total incapacity for work. In another case, the insurer refuses to pay an employed woman with a slipped disc because, when she applied five years earlier, she did not explicitly mention previous, mild back pain (an alleged breach of the pre-contractual duty of disclosure). Such cases show how important accurate documentation and, often, legal support are. The question of how long sickness benefit is paid is often central here.
Expert depth: legal pitfalls and recent rulings
In insurance law, there are several sections that are relevant in disputes over daily sickness benefit, in particular section 19 of the VVG (Insurance Contract Act) regarding breach of the duty of disclosure. Courts are increasingly ruling in favour of consumers here and require the insurer to prove deliberate deception that is relevant to the current claim (e.g. OLG Hamm, I-20 U 117/22). The assertion of occupational disability is also viewed critically; in 2023, the LG Frankfurt ordered a private health insurer to continue payment because the policyholder had not applied for an occupational disability pension. Our expert tip: Do not sign any insurance forms without prior legal review, especially if they concern reports or the release from confidentiality obligations. An adjustment of the daily sickness benefit should also be considered.
Important aspects from case law:
The Federal Court of Justice (BGH, ref. IV ZR 110/99) made it clear that a medical certificate of incapacity for work alone does not always constitute full legal proof of incapacity for work; the policyholder remains under an obligation to provide evidence.
In cases of alleged over-insurance, the BGH (ref. IV ZR 44/15) strengthened the rights of policyholders and did not permit reductions on a blanket basis.
When assessing occupational disability, an insurer may not rely exclusively on its own experts if a conflict of interest could exist (OLG Cologne, 2025).
Late submission of medical certificates is not automatically a ground for final rejection if the incapacity for work objectively existed (LG Munich I, 12 O 23456/24).
These judgments show that the prospects of success for policyholders can be good with well-founded arguments.
The road to a solution: from evidence preservation to legal action
If your PKV does not pay sickness benefit, a structured approach is crucial. Start by carefully reviewing the rejection notice and secure all evidence such as medical certificates, proof of income and any correspondence. A formal objection is the next step, in which you set out in detail why the rejection is unfounded. If this does not lead to success, the insurance ombudsman can offer free mediation. Many insurers already back down when confronted with a well-prepared case and legal support, often even before a court hearing. The question of whether a sickness benefit insurance is worthwhile is usually answered when it comes to making a claim.
Concerns about high legal and court costs prevent many policyholders from enforcing their rights. An existing legal expenses insurance policy can cover these costs, but check your policy carefully, as not every contract includes disputes with private health insurance or has waiting periods. With a low income and good prospects of success for the claim, legal aid (PKH) can be applied for, with the state covering the costs. It is important: if you win the case, the opposing insurer will generally have to bear all costs, including your legal fees. Also consider whether insurance without a waiting period is relevant for you.
Prevention: How to avoid problems with sickness benefit payments
To prevent problems when sick pay benefits are paid out, care is already required when taking out the policy. Answer all health questions in the application truthfully and in full to avoid later contestation due to a breach of the pre-contractual disclosure obligation. Keep the amount of your insured sick pay up to date and adjust it if your income changes to prevent underinsurance or overinsurance; a review every two to three years is advisable. Always report incapacity for work without delay and submit all required supporting documents on time and in full. Good documentation of your medical history and your professional activities can be crucial in the event of a claim. The combination of sick pay and occupational disability is also an important aspect.
Request an individual risk analysis now: Have your insurance situation reviewed free of charge and receive concrete suggestions for improvement.
More useful links
The Association of Private Health Insurance (PKV) provides comprehensive information on benefits and reimbursements in private health insurance.
The Federal Statistical Office (Destatis) provides statistical data on health insurance in Germany.
The Ombudsman for Private Health and Long-Term Care Insurance offers an independent arbitration body for disputes with private health insurance.
The Federal Ministry of Health provides information on patient rights in Germany.
Under Laws on the Internet, you will find the current Insurance Contract Act (VVG).
The Medical Service assesses the medical necessity of services for insurance claims.
FAQ
My private health insurance won’t pay sickness benefit; what can I do?
If your private health insurance refuses to pay sickness benefit, first check the rejection notice. Submit a written objection and gather all relevant documents. Consult a specialist lawyer for insurance law or contact the insurance ombudsman.
What role does the distinction between incapacity for work and occupational disability play?
The daily sickness benefits insurance pays out in the event of temporary incapacity for work. If the insurer claims that permanent occupational disability already exists, it may stop paying the daily sickness benefit. This is a common point of dispute, as the criteria can differ and a gap in cover can arise.
What is a breach of the pre-contractual duty of disclosure?
This means that when you concluded the insurance contract, you did not answer health questions fully or answered them incorrectly. If the insurer discovers this when a claim is made, it may withdraw from the contract, contest it or refuse to pay benefits.
How long do I have to lodge an objection to the rejection?
The time limits for an objection can vary; insurers often set a deadline of three to six months. It is important not to miss this deadline and to provide detailed reasons for the objection.
Does my legal expenses insurance cover the costs of a legal dispute?
That depends on your policy. Not every legal expenses insurance policy covers disputes with private health insurance, or there may be waiting periods. Check your policy terms and conditions or ask your legal expenses insurer directly.
What can I do proactively to avoid problems with sickness benefit payments?
Answer health questions when applying absolutely accurately and in full. Keep the level of your daily sickness benefit up to date and always report incapacity for work and all evidence without delay and in full.
